The DeFi market at a glance

Current Challenges in DeFi

Decentralized Finance (DeFi) or "open finance" is the automation of the financial sector based on exponential blockchain technology, with a goal to eliminate counterparties and shift risk to technology. As a result, many more individuals may access financial services at lower prices or get better interest rates than those available from traditional financial institutions.

Decentralized Finance (DeFi) was established in 2018 and has since received a lot of interest, with the total value locked reaching $114 Billion in November, 2021. Despite its longevity of over three years, DeFi is still frequently neglected by crypto enthusiasts, investors, and entrepreneurs alike. The DeFi market is evolving and reacting to new developments rapidly, making it tough for novices to enter.

Despite being in its infancy, there are already a large number of participants big and little enough to attract new entrants (such as company owners). The main challenges to entry are indisputably knowledge and an understanding of decentralized finance and blockchain technology in general.

Big banks and institutional investors have been working for years to blend blockchain technology into conventional finance, but they missed the cryptocurrency upswing and profit from decentralized finance. Now that valuations have stretched and yields have declined in traditional markets, they're just eager to join. The effort is to establish a solid foundation for the inflow of old money into new digital assets.

Meanwhile,

CoinGecko⁠

pegs the overall market capitalization of decentralized finance (DeFi) at $152.6 billion, representing the cryptocurrency industry's broad range of lending, trading, and betting activities carried out almost entirely on blockchain networks using tokens as proceeds and collateral. This represents a market share of 5.5% in the overall cryptocurrency market. The top five cryptocurrencies on CoinGecko's list are Terra (LUNA), Chainlink (LINK), Uniswap (UNI), Dai (DAI), and cETH (CETH).

Want to print your doc?
This is not the way.

Try clicking the ⋯ next to your doc name or using a keyboard shortcut (

CtrlP

) instead.