The decentralized finance (De Fi) arena is growing rapidly despite the recent falls of cryptocurrencies.
De Fi: The Future of Money?
As digital currency assets are dropping in price thanks to the coronavirus pandemic, the industry of decentralized finance is experiencing positive results. The arena centers on users providing and receiving digital currency payments to garner goods and services without the necessity of third parties or regulatory steps.
Bobby Ong – the co-founder of Coin Gecko, a site that analyzes crypto assets – says that this can best be measured through what’s known as TVL, or total value locked. He says that the total value of cryptocurrencies locked within the De Fi industry during early 2019 was somewhere around $275 million.
By contrast, this number exceeded $1.2 billion by the time February 2020 rang in. In a recent statement, Ong explains:
The TVL has seen a growth of 15 times in the past two years, according to De Fi Pulse – a website that provides analytics and rankings of De Fi applications. The suppressed price movements of the cryptocurrency market do not seem to be slowing the De Fi movement. Developers are still excited to explore the potential of De Fi as it has not reached its full potential.
Among the largest decentralized finance applications, according to Ong, is Maker, a smart contract platform that runs on the ETH network. He continues his statement by explaining:
What the platform does is allow cryptocurrency users to lock in ether or several other coins [in smart contracts] and receive a decentralized stable coin called DAI. The value of DAI is pegged to the U.S. dollar. This stable coin allows users to have a stable asset without the need to go through a centralized authority.
To assist in the development of decentralized finance and help people better understand it, Coin Gecko has released a new e-book that users can look forward to. Written by seven people – including Ong and his Coin Gecko co-founder T.M. Lee – the book is designed to give people a comprehensive view of how De Fi applications work.
The book is written in verbiage designed for beginners or those with little De Fi experience to ensure they can understand the applications and figure thing out quickly. The book will be free until April 30, after which users must pay for the information it holds.
We Wrote This for a Reason
It is a steep learning curve for many trying to understand De Fi. It took us some time to understand all the different applications. Even after you understand these, using the applications may not be easy, so we created step-by-step guides to help users get started easily without the need to read the many blog posts all over the internet. We worked hard to compile this information.