The total estimated value committed in decentralized finance, or DeFi applications, is now purportedly more than $3 billion – garnering over a billion dollars within just two weeks.
As per DeFi Pulse, it took the particular industry more than two years to initially surpass the $1 billion milestone. The success of DeFi was seemingly short-lived back then, as its value crashed to its lowest ($600 million). However, it surprisingly experienced a massive resurgence this year. Just this July 7th, it announced that it has successfully doubled its then-highest-to-date value with $2 billion for the very first time. And now, just a mere two weeks after its massive success, another billion dollars have been committed to the DeFi industry, placing their total value at over $3 billion.
This year has been rough for almost everyone but not to DeFi, as the industry’s current trend is still pointing upwards.
DeFi platforms are benefitting from the explosive growth of the ecosystem
Unsurprisingly, several DeFi platforms are currently basking on the massive surge of interest in DeFi. Notably, Curve, Balancer, Uniswap, and Bancor have since announced that they have already eclipsed their previous month volume figures with a couple of weeks still to come for the current month.
The DeFi startup Balancer, for instance, is already on the verge of doubling its trade volumes from June with $160 million. A 72% uptick from its previous record numbers of $93 million.
The massive success and exponential growth of the DeFi industry seemingly started the same time Compound, one of its most prominent platforms, began offering COMP tokens this last June 15th. The particular governance token has since then surged in price value and managed to attract the eyes of many to DeFi.
COMP’s success can also be pointed out as the reason why the controversial yield farming boomed. Yield Farming is the term currently used that pertains to the practice of exploiting DeFi application rewards (yield) by utilizing high-leverage solutions. Those that engage with the particular method can indeed receive more rewards in exchange for higher risks.
Yield Farming has since caught the interest and ire of many. Many are now asking what will happen if the substantial capital amount brought by these incentives were to collapse all of a sudden? Clearly, particular concerns should be tackled with regard to the controversial scheme. One of Blockchain Capital’s senior associate, Aleks Larsen, believes that the scheme carries a whole lot more risk than the public initially thinks of in his written detailed conversation on DeFi.