Decentralised Finance (DeFi) continues to show a positive trend. Never before has so much capital been deposited in the various DeFi protocols. According to the DeFi Pulse site, there are now already over 11 billion USD in the major protocols. The decentralised stock exchange Uniswap is the winner of the last weeks.
DeFi reaches all-time high in deposited capital
Decentralised Finance is the latest trend in cryptospace. At the end of 2019, the first decentralised applications have already started and the first decentralised applications have experienced an incredible momentum. Especially the open source project Aave has emerged as one of the most popular protocols.
Aave was able to achieve a return of over 11,000% within one year and is still in third place on DeFi Pulse. Before that comes MakerDAO with the decentralised Stablecoin DAI and now in first place is Uniswap with a deposited capital of over 2 billion USD.
Uniswap is at the top
The increasing capital deposited in the DeFi protocols is evidence of a certain confidence of investors in the most important projects. These are really decentralised applications that have pioneered the DeFi Space. Many are trying to imitate the success of these projects with simple copies. Usually such projects do not survive for more than one or two weeks.
The winner is currently Uniswap, which is probably the most important application in DeFi Space. Here, anyone can exchange a token for another one in a decentralised way, without KYC or any registration. The platform offers everyone unlimited access. So everybody can list any token there. Uniswap is the current catalyst for DeFi, so to speak.
DeFi still dependent on the Bitcoin course
Nevertheless, the DeFi room also involves enormous risks. Regardless of the protocols, some of which have not enjoyed an audit, there is still a strong dependence on the overall market. In this sense, the Bitcoin Superstar price still plays a decisive role.
When Bitcoin makes a strong move up or down, capital is usually withdrawn from DeFi to either take the positive trend in BTC with it or to protect against losses. The high dependency on Bitcoin causes a strong downward movement of the Altcoins in case of a sale. There is therefore still a lot of speculative capital deposited in DeFi.
Nevertheless, the interest in DeFi is increasing and there is no end in sight at present. The high yields, some of which can be seen in the minutes, will continue to attract many speculators. Nevertheless, DeFi is currently still only accessible to experienced crypto investors. Dealing with a wallet and the DeFi protocols still poses certain hurdles, which are gradually being removed.
With the advent of Uniswap V3 and Ethereum 2.0, the DeFi space should get even more movement. Which project will gain the upper hand is currently not foreseeable. However, it can be assumed that the most popular protocols will continue to be in vogue.
We are curious how it will continue in the future and will keep you informed as always.