As with most technical fields, the crypto industry is evolving in waves. The first wave was about building Layer 1 solutions and infrastructure such as Bitcoin (BTC) and Ether (ETH). The second wave is the ICO boom. As this draws to a close, there has been much speculation as to what the next cryptographic wave will be.

Some expected offers of security tokens and initial exchanges to be the next big thing, but it did not happen. Others believe in Layer 2 expansion solutions such as Plasma and Lightning Network, which have recently proved to be important decisions due to network congestion, with Ethereum gas charges hitting a whole new high every day. Unfortunately, these solutions are still far away.

On the other hand, we also have zero-level solutions such as Cosmos and Polkadot, which fall into roughly the same category: they are forward-looking in the sense that they provide a free flow of smoothness between networks, and also solve congestion problems.

We also have decentralized financing. This was just in time to bridge the gap between the general disappointment (let’s be honest) of the first coin offers (over 80% fake, and most of the remaining projects provide no station value) and purely technical L0 and L2 solutions. in many years.

DeFi offers a unique solution: synthetic products that enable conservative investors to earn interest on stack coins and allow crypto-optimistic traders and optimists to capitalize on their existing positions. However, the real brilliance of DeFi is the issuance of control set marks. These tokens really hit the screw, enabling a really big return on investment while radically democratizing protocol management and promoting true decentralization. This enabled DeFi to become the purest form of autonomous decentralized organization we currently have.

DeFi originally came in two flavors: secured / synthetic lending (eg Composite) and infrastructure to support the former (eg Oracles, decentralized exchanges, correlation curve contracts and automated market makers such as Balancer).

Compound is one of the most popular names in DeFi. The loan solution was one of the first (along with MakerDAO, although there are notable differences) to introduce corporate governance codes for users. Since the company began distributing COMP tokens to lenders and borrowers in early June, the platform has exploded, increased liquidity six times and become the largest DeFi app – only recently surpassed by Aave and Maker.

Meanwhile, the COMP token has grown from $ 66 in early June to almost $ 220 in mid-August. Compound distributes 2890 COMP tokens daily to all users who provide liquidity or borrow money over the protocol. The exact spread conditions are determined by the interest of the individual currency pairs. The governance token model has already proved useful for decentralization as business owners have influenced protocol policy.

RELATED: The COMP symbol for the boat takes DeFi by storm and should now be in the center

Then there is Balancer (BAL), although BAL tokens have not yet been minted and distributed, and after some hesitation due to early price, the BAL token has grown from around $ 8 in mid-July to over $ 34 by the end of August. .

Interestingly, the control symbol was not present in the original Balancer design, but was introduced later, following this trend in digital assets. It paid off anyway. It is worth noting that this is despite the fact that the Balancer team kept most of the codes to themselves.

These projects have two things in common: they provide high returns through interest or commissions, and they can generate exponential profits through their corporate governance codes.

For the second phase of the development of DeFi, we have a different approach – what I would call meta-DeFi solutions. These are projects and protocols that provide game-changing possibilities such as improved robot farming (such as or blockchain interactions (such as Equilibrium) that allow both to benefit from Ethereum’s larger pool method. as well as solving congestion problems. is a case where, although the developers stated that the underlying management token is largely useless, the value jumped from $ 700 to $ 15,000 in less than a month. It was the story of the fastest growing DeFi in the short history of cryptocurrencies.

Although the symbol only gives voting rights to its holders, the developers behind it decided to spread all YFIs to the community, leaving nothing for themselves, ie.

Source: CoinTelegraph