The centralized finance (CeFi) lending market experienced a 6% quarter-on-quarter contraction in Q1 2026, marking the first industry-wide shrinkage since Q3 2024, according to CryptoQuant data. The total loan volume decreased to $23.3 billion as crypto users reduced leverage amid a bear market. Tether remains the largest lender with $15.8 billion in loans, holding a 68% market share, followed by Maple Finance with $2.1 billion (9%) and Nexo with $1.8 billion (8%). Market share is shifting towards Maple, Nexo, and Coinbase, which saw increases of 1.0, 0.5, and 0.7 percentage points respectively. Both Coinbase and Maple reported approximately 6% growth in loan volumes, while Nexo saw nearly a 1% increase, making them the only major lenders to record growth. In contrast, other institutions like Galaxy Digital and Ledn saw significant declines of 21% and 19% respectively, with Tether's loan volume also dropping by 7%.