DeFi (fully identified as Decentralized finance) is ebcoming a very popular world in the finance sector and from traditional finance to cryptocurrency, experts are looking out for the best strategy for DeFi. According to Wikipedia, DeFi, still at the experimental phase, is a form of finance that does not rely on central financial intermediaries such as brokerages, exchanges, or banks, and instead utilizes smart contracts on blockchains.source The DeFi applications allow for direct linkages between the parties involves in the transactions.
More beautiful about is the feature that allows participants to pool their funds into something bigger which therefore allows other people to lend or borrow funds from others, speculate on price movements on a range of assets using derivatives, trade cryptocurrencies, insure against risks, and earn interest in savings-like accounts. source
Today, we have many DeFi options one can take advantage. Coinmarketcap shows top DeFi tokens by market capitalization as screenshot below. It is interesting to see that the DeFi crypto market cap is $42.21B (as at February 2, 2021), a 12.54% increase over the last day. That value is threatening to the finances of traditional financial houses and they stand a risk of losing many customers, therefore making DeFi a topic of concern for researches and scrutiny.
DeFi are meant to be run in Decentralized applications (DApps) that perform financial functions on digital ledgers called blockchains, a technology that was first utilized by Bitcoin but has since caught on more broadly. Where a participant is unlucky to engage a DeFi that is not run on a DApp, such participant stands the risk of losing his investments since he doesn't have full control over his funds.
Looking at a blockchain like Hive that has passed the test of decentralization and immutability in transactions, engaging a DeFi option here would be one of the best investment decision one can take. With over 19 decentralized applications and over 20 toolsets, the Hive blockchain has passed the test of scalability as well serving millions of true human users over the last 10 months of its existence.
Anyone who has been a part of the Hive blockchain would have already participated in DeFi in one way or two especially with the several options we have. Staking is a recurring word when it comes to DeFi and this is the feature that authenticates that a participant is ready to lay down his assets in a bid to take the interests that accrue from the lending and other usecases that yields profits to the pool.
Over the last few months, I have engaged several tokens in the Hive blockchain which serve the DeFi example and allows stakeholders to receive tokens (as interests) for staking a particular token. usually they are miners like LEOM, LEOMM, CTPM, HUSTLERM, STEMM and exeptional tokens like LIST. LIST serves as a token for curation and stakeholders also receive staking rewards, thereby compounding the interest obtainable in holding a stake of the token.
I have personally made profits as staking rewards from LIST, LEOM and CTPM stakes. It was surprising to see that they already have reached over $107 so far. Amazingly, I am already taking profits from using the token stake (for LIST) to upvote other contents and earning curation rewards. Today, I also earn COM token for holding a stake of LIST and HUSTLER.
The leoFinance community also promises a big innovation called #LeoFi intended to serve as a typical DeFi operation within the Hive blockchain. The creator of Hive-engine @Aggroed is also seeking to decentralize H-E and also proposing a DeFi feature in Hive's second layer which would cover over 50 tokens that are trading in high volumes so far. Read this post.
@Taskmaster4450le, an informed economist and a crypto investor shares his views about LeoFi in this post and this post and both are worth your reading time. Some exciting things are happening o Hive and it makes the chain a representative of the entire crypto sphere. From Fungible to non-fungible tokens, stable and others, you have the diversity to be served with.
DeFi is on Hive!
