As 2020 draws to a close, this is a good time to reflect on the biggest cryptocurrency developments and the frantic ride this sector has given investors.
Bitcoin (BTC) is hovering above $ 7,000 at the start of the year, and with half of the block reward approaching, this groundbreaking digital asset is starting to gain traction. This was followed by the Coronavirus pandemic and a sharp correction in global stock markets that led to the collapse of the famous Bitcoin Black Thursday, which sent the Bitcoin price down to $ 3,782 on March 12th.
While things looked bleak for Bitcoin and the larger global economic system, the decentralized financial sector was just starting to heat up.
The emerging wave of previously DeFi protocols has taken a dizzying and difficult to navigate decentralized apps and exchanges like EtherDelta and have transformed them into massive high-yield monocytes that regularly bring high returns to investors. In terms of total closed value (value of assets linked to the protocol), transaction volume and market value, many DeFi platforms and related tokens are now competing with the best central exchanges.
In 2020, the spirit of decentralization of cryptocurrencies has already taken hold, and decentralized peer-to-peer trading in smart contracts has reached the point where any investor with MetaMask can easily access a new ecosystem with unique projects that generate passive income. A wallet and a few dollars in BTC, Ether (ETH) or Tether (USDT).
In addition to achieving high returns from DeFi tokens, investors have also been able to participate in a new form of effort that includes offering assets as collateral to startups for cryptocurrencies and blockchains in exchange for the return of newly issued tokens. Typically, tokens instantly gain great value and generate profits for stakeholders or farmers. The phenomenon of “selective use” started with the launch of Compounds COMP in June.
The cropping trend symbolizes the root nature of the DeFi room. Obviously, some projects were aimed at financing creators’ portfolios through the use of FOMO and the gullibility that characterizes many new investors in emerging markets such as cryptocurrencies. For example, the standard cultivation mechanism requires users to purchase multiple existing tokens before receiving profits. Due to the massive inflationary pressures early on, movements in the price of tokens are often dominated by breeder farmers and they are themselves the source of profit they seek.
Nevertheless, a number of DeFi’s high-profile projects have come to light and gain notoriety through its multiple uses. To this day, they continue to expand their communities and propose new revolutionary economic concepts that can transform cryptocurrency and traditional finance.
Uniswap: One DEX to manage all
Arguably, among all the projects announced in 2020, Uniswap has been one of the major players in helping to break the DeFi barrier. The platform introduced a new ecosystem in which anyone could create a token and place it on the Ethereum blockchain without having to pay a listing fee or participate in an exchange incubation program.
While Uniswap was launched in 2018 and has shown steady lifetime growth, in 2020 it has reached levels that little could be expected. The daily volume of the protocol in the first half of the year was under $ 1 million, and in the summer of DeFi, the protocol accumulated billions of cash and peaked at nearly $ 1 billion. While tensions over DeFi have since eased, Uniswap’s volume numbers consistently cast doubt on some of the more established central exchanges.
Looking back at the ICO Days in 2017, Uniswap introduced the UNI token for governance on September 16 and sent 400 UNI tokens to every wallet that interacted with the protocol. The “DeFi Incentive Test” – named because it was originally priced at around $ 1,200 – sparked a new battle of excitement and excitement around the project, pushing UNI’s price briefly to $ 8.39, the equivalent of the air price. It cost more than $ 3,300.
Badly wanted. Treasurers provide agriculture
With the chance of profit from cryptocurrencies multiplied by DeFi, pooling services are becoming increasingly necessary for regular users to optimize profits.
Yearn.finance and its corporate governance token YFI became the gold standard in the room as the team combined the best features of smart contracts and traditional financial systems to create a unique ecosystem of services that investors need.