Series 1 β€” DeFi is the New Area of Growth For Crypto Investments

Nov 1, 2020 -
4 min read

πŸ“œ DeFi, the newest buzzword in blockchain and crypto. The prominent use case of blockchain technology in this decade is a big event for the entire crypto industry.

πŸ‘€ If you have had even half an eye on the cryptocurrency space in 2020 then you should probably be aware of all the new happenings and emerging projects around DeFi.

πŸ‘‰ Decentralized Finance (DeFi) β€” is an ecosystem of Decentralized financial applications that are backed by Cryptography. Generally, it is built on Smart Contract with Blockchain technology.

βš™οΈ This revolutionary new financial system is on the way to decentralize the traditional financial services such as payment, trading, lending, borrowing, investing, wealth management, insurance, etc. on the blockchain.

🏦 For example, in traditional finance, lending opportunities are often restricted to certain income brackets, credit scores, and geographies. There are also stringent Know-your customer (KYC) and Anti-money laundering (AML) policies to face. But in DeFi, anyone can become a borrower, lender, speculator, or investor using decentralized smart contract protocols.

The DeFi movement is about bridging these gaps and making finance accessible to everyone without any form of censorship.

πŸ”DeFi is a system that operates under the concepts of neutrality, privacy, inclusion, openness, and transparency. Its tools are freely accessible to everyone and it operates under blockchain technology.

πŸ“ˆ The decentralized finance space has grown exponentially over the last few months, with the Total Value Locked (TVL) growing from under $1 billion to $12 billion today. It had a little over $600 million locked in back in October 2019. Since the beginning of 2020, TVL across all DeFi platforms in dollar terms has increased over 1000% and it does not look like slowing down anytime soon!

πŸ€‘ DeFi is certainly an excellent place to look for investment opportunities. Maybe you’ve heard of people getting rich on early investments in Bitcoin and Ethereum. Many of the successful crypto traders see this year’s DeFi boom to pre-2013 Bitcoin and pre-2015 Ethereum which is a once-in-a-lifetime opportunity!

πŸš€ Comparing DeFi to the multi-trillion dollar world of banking and traditional finance shows that it has a lot of room for growth. And even compared to the crypto market as a whole, DeFi is still just a blip with a market cap for the leading 80+ DeFi tokens representing just around $15 billion, or 3–4% of the total market capitalization of all cryptocurrencies.

πŸ’ͺThe crypto world has been taken by DeFi because it represents a bold new departure from the world of centralized finance which is helping to receive +10% interest using DeFi lending protocols!

🌾A new type of crypto functionality in DeFi β€˜Yield Farming’ was introduced by Compound protocol. This is a practice of staking or locking up cryptocurrencies in return for rewards. The general idea is that users are rewarded with tokens by participating in the token economy and providing liquidity to the protocol. Yield farming can also be called liquidity mining.

πŸ“ˆπŸ“ˆ This exponential growth in the last few months appears to be mainly related to a yield farming trend that started when lending protocol Compound began distributing its COMP governance token to users who interacted with the protocol.

πŸ’‘ Yield Farming can be a profitable venture on its own, but the tokens being farmed often see their price surge as well. One of many examples of this is YFI, the governance token of, a site that helps users find the best yields in DeFi protocols. The price of YFI token went from $0 to $43k in 2 months.

πŸ“Š YFI has a fixed supply of 30,000, which led to the price of each individual token surpassing that of Bitcoin.

πŸ’° Aave, Compound, Maker, and other lending & borrowing platforms are providing permissionless, automated, non-custodial, secure, dynamic, and borderless services.

⏳ Now, the decentralized exchanges (DEXs) are operated without a central authority in a decentralized way. Uniswap, Curve Finance, dY/dX, Yearn Finance are powering this bankless journey by introducing Liquidity Pools, Yield Farming, Flash Loans, etc.

πŸ’ŽDeFi is undoubtedly an exciting place to be right now and poses many attractive opportunities for traders and investors. Financial savvy investors should pay attention to DeFi because it’s an exciting new way to interact with and make money out of crypto growth.

β€œIt is actually possible to simultaneously believe that most of the Yield Farming is a zero-sum bubble destined to pop and it is a once in a decade investment opportunity! DeFi is the future of finance.”

🌱 If you want to participate in DeFi and yield farming, you need to know what you’re doing. DeFi is experimental and technically complex. Doing your own research is highly recommended before investing in any crypto asset.

πŸ”— Signup now-

πŸš€πŸš€ Decentralized Finance (DeFi) is the next evolution of cryptocurrency technology. Join the movement and get the most optimized return with DAOventures.

πŸ“˜ Oh, one last thing, if you are a beginner or want to learn more about DeFi, you can download and read this β€˜DeFi 101’ eBook!


Signup for professional insights,
delivered to your inbox

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Signup today to get the latest crypto updates and market insights