Even though prices are slumping as of the last few weeks in crypto we are still holding steady at the levels I thought we would of 35k -40k on bitcoin and 2k-2.5k on Ethereum. This is because there's actually a lot of unknowns at the moment as much development that has been going on for the last few months is finally about to lift off.
Must of that development comes in the shape of Ethereum, Polygon, Polkadot and Later in the year Bitcoin. All of these projects revolve around improving and introducing new aspects of DeFi.
All of this is gearing DeFi up for some rather huge growth once it all gets implemented. Polygon is primarily working to just elevate the high fees from Ethereum by providing a layer two blockchain. That means you take your Ethereum, Buy Polygon do all your DeFi stuff on Polygon networks and if you want Ethereum again you transfer out. It's really not anything more than that.
Same goes for Polkadot however instead of just working with Ethereum it has the capabilities of being a layer two on any blockchain and tapping into it. A Heterogeneous multi-chain system. Wouldn't that make Polkadot by default a better blockchain? In a way yes but just like in any business if you try and please EVERYONE you end up pleasing no one. This is why we will most likely see Polygon overtake Polkadot at some point. At the moment Polkadot has 2x the market cap of Polygon but the disadvantage of polygon is that if Ethereum gets upgraded enough to remove the high fees it pretty much makes polygon obsolete and not needed.
If all of this development around DeFi doesn't get you excited for what's about to happen over the next 6-9 months I don't know what will! This time last year DeFi held 1 billion. It now holds 60 billion. The markets are just waiting for these innovations to happen so high fees don't hamper the system yet again. This is what caused the 2017 rally to end. Extremely high fees that drove everything to a screeching halt. We did hit a new high and held it for a while but until advancements happened we saw crypto in a very long bearish trend. I feel like we are in that bearish moment again while development is being worked on to improve these fees and systems. However instead of years we should see it happen within the next 9 months.
