Raising Global Investment in DeFi Space– Growth and Analysis
After the 2008 financial crisis that greatly shook the strongholds of the global market, one of the greatest economic downturns since “Black Tuesday,” there was no need for any other notification or follow-up letter to inform traders and investors that they needed a new locus of financial transactions. More than the urge to bypass traditional and centralized financial institutions that continue to pose strict regulatory procedures and are sometimes a dutiful habringer of excessive risk-taking opportunities, there were also no longer a fair amount of trust and reliability on the system. It was undoubtedly a failing that had needed no saving; besides, to be sincere enough, no one would want to hide a tote bag of gold on top of a lectern where everything ugly could stretch a hand and retrieve it with ease.
Not too long, in 2009, Bitcoin came as the awaited miracle, through the hands of Satoshi Nakamoto, enabling an unmistakable turn-around of things in the world of finance. “It was just like someone had unleashed a fire no one could extinguish,” an acclaimed crypto-enthusiast had said on national television in a bid to explain the magic of that era of digital economy. And no one could have imagined it better. Because, more than ever imagined, the price of Bitcoin would hike from $1000 to $13,000 between April 2016 and December 2017, and then, in six months, topple the chart with a whopping increase to $53,000–an undeniably astonishing data that consequently illustrates its storm-rippling number of users. Many years later, Bitcoin would ride unhindered on the great wings of 2x trading volume more than any other cryptocurrency in the world. But this isn’t a review of what Bitcoin grew up to become, the path it took to arrive to its zenith. Rather it’s a revisitation of how that era of Bitcoin, perhaps, was the springboard of what would later be known as DeFi (decentralized finance)–an operating system that allows people to send payments to anyone living anywhere in the world without having to face the disturbing trends of government agencies, KYC terminologies, and high-rise exchange rates.
Notwithstanding, it was undoubtedly a step-by-step phenomenon; a quick tumble of innovations that happened in the act of satisfying the needs of the digital finance: borrowing, lending, and funding; from centralized protocols to decentralized applications; from the limiting technologies of Bitcoin to the endless possibilities of the smart-contract-platform known as Ethereum, weighed upon by its efficient Turing programming language and solidity and other advanced blockchain technologies; from centralized exchanges (CEX) to decentralized exchanges (DEX) that went ahead to cancel out the stereotypes of what business transactions should be.
New technologies, as well as users and providers, are still springing up in explosive manners on a daily basis, with only two concrete purposes–efficiency and sufficiency. For instance, who could have thought that the blockchain technology market, as nascent as it is, within the stretch of two years, would multiply from $1.2 billion to $3 billion, and, however imaginably unrealizable it might sound, is predicted to reach $67.4 billion in 2026. As of March 2022, there are 80 million blockchain wallet users, and the number keeps skyrocketing. This is solid proof that the future of DeFi is amazingly great, both in its usability and applications. And to ascertain this, statistically: between July and December 2020, the estimated aggregate value locked in decentralized finance peaked from $9.1 billion to $25.2 billion, and now tagged at a value of $80 million, according to crypto.com.
However, we’d be venturing into decentralized financial exchange which, in unobjectionable ways, took the idea of DeFi to its full, if not fullest, glory.
A brief overview of decentralized exchanges and its significance in the crypto economy
Without transaction, the world of finance becomes a small, wrecking ball. That’s to say, decentralized exchanges remain inarguably the fulchrum of the DeFi ecosystem. It came at a time when centralized exchanges were disturbingly frustrating traders and clients with their rigid, overbearing KYC requirements, and, to worsen the whole situation, also taking custodial ownership of their users’ trading accounts, which in turn attracted massive hack and scam experiences and bulky transaction charges. What other miracle was needed at that time than a secure, non-custodial platform where traders can engage in swapping of assets without going through such heart-wrecking experiences? DEX was, and is still, the answer, and even more.
Over the years, many viable decentralized financial exchange applications have been brought to the fore such as Maker, PancakeSwap, Sushiswap, and Uniswap. And they have gone ahead to add ground-breaking credibility to the giant future of the blockchain industry, and crypto industry at large. Take for example, Uniswap, the largest and foremost DEX trading platform built upon the Ethereum blockchain to solve liquidity issues, with its monthly volume that rocketed from $169M to $15B within the space of five months in 2020–a whooping hike of 100x; or Sushiswap, another AMM-based DEX that provides a market ground for trading of tokens through the help of smart contracts, merging with Uniswap to create high trading volumes in decentralized exchanges; or even PancakeSwap, another DEX that uses automated market marker to swap BEP20 tokens in Binance Smart Chain tugging at the belt of the crypto economy; or the many others. The list lingers and lingers, as each new second seems to be a door opening itself to another puzzling question and another new DEX application as a nearly complete answer.
Each decentralized exchange application has its own role to play in the world of decentralized finance, its own degree of utilization, its own way of trying to become better and sufficient to their users. And no one cannot predict its next call of action. Who could have thought about the amazing invectives of another DEX platform like CrossFi, a cross-chain Filecoin-built platform that strive towards building a linkage between investors and clients with their efficient, top-level technologies, who has made and is still carving twinkling wonders out of the blockchain industry, leaving giant imprints as a lending and liquidity sharing platform, and other new features, toppled up with its layered transaction speed? And who even knows what other features the CrossFi application might provide, or even what the world might wake up to, in years to come? It’s a thrillingly delightful watch: the growing miracles of decentralized exchange. Not to even talk about its trading volume monthly rise of $162.8 billion in May 2021, or an additional 137.3% gain in January of the same year, according to 2022 Digital Asset Outlook reports, which surpassed $1 trillion in 2021–another evidence that more users, more providers and clients are tapping into the miracle.
What other wonders. . .
No one can really predict where the future of decentralized finance is heading to. No one can even try. But what every crypto enthusiast seems to be sure of, however, is that the world of DeFi is so incredibly broad that we can’t possibly see the end. As for its growth, they are quite sure that there are many seas yet to be crossed, many doors yet to be opened, many innovative stamps yet to be struck upon its face.
CrossFi is a cross-chain protocol that provides liquidity to you for Filecoin staking and rewards.
CrossFi Official Website: https://crossfimain.com
CrossFi DApp Address: dapp.crossfimain.com
CrossFi Official Twitter Account: https://twitter.com/globalcrossfi
CrossFi Official Discord Group: https://discord.gg/UKGSX3VBY3
CrossFi Official Global Telegram Group: https://t.me/crossfimain_en
