From on-chain data, the popularity of DeFi leveraged trading is clearly waning. Especially for leading lending protocols like Aave, the lending volume has decreased by about 70% since August.

The underlying logic is quite straightforward—the market experiences a rally, investors' risk appetite shrinks accordingly. When the price of a coin is in a downtrend, who dares to borrow money to leverage? Instead, a capital preservation mindset becomes more prevalent. The sharp decline in lending demand precisely reflects the psychological shift in the market from aggressive to conservative during this adjustment. This phenomenon has also occurred frequently in history, as leverage and risk appetite tend to move in the same direction.