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DeFi, means “Decentralized Finance” or “Distributed Finance”.
The goal is to create a multi-faceted financial system based on blockchain technology and cryptocurrency to recreate and improve the existing financial system. Defi is the potential financial marketplace that can also form a relatively complete closed-loop ecosystem.
DEFI is an ecosystem instead of just a coin. It is more active within the Ethereum ecosystem. After two or three years of exploration, the DEFI ecosystem can be broadly divided into several categories. Namely; assets, lending, exchange, synthetic assets, and aggregated finance.
Gamefi obviously has a more specific meaning than Metaverse. Gamefi refers to the decentralized financial products within the sort of games, gamification of Defi rules, and NFT of game prop derivatives. It is not a newly created concept, and its most significant feature is that the user’s assets become equipment or tools in the DEFI game, and in turn, the user can gain revenue or rewards during participation in the game.
Most of the current DeFi gameplay mainly includes role-playing, virtual space, nurturing combat, and multiplayer construction. Compared to the previous liquidity mining model, GameFi projects are more interactive, experiential, and immersive with users, and have a higher level of fun, for example, many games use NFT pets to reproduce, they use NFT equipment to enhance skills, pledge NFT’s to gain revenue, or introduce PK versus battle mode to participate in battles and complete tasks, allowing users to make money while playing games P2E is the current GameFi project.
P2E is the biggest highlight of the GameFi project, which is to earn while playing. Compared to the traditional game “deposit to play” or “free to play”, this difference is revolutionary. Players can raise and hatch, upgrade and fight monsters in the game. Not only can they get the pleasure of playing the game, but they can also sell the tokens, equipment, props and other NFTs they get in the trading market to gain revenue. Currently, Gamefi is maturing day by day and solving a problem, which is “unsustainable”
Even if you haven’t heard of Gamefi, you must have heard of Axie Infinity.
In Axie Infinity, players can breed and multiply Axies and engage them in battles, with the winner receiving Axie Infinity’s native token, Smooth Love Potion (SLP). Like gold coins in traditional games, but SLP can be sold directly, and players can exchange it for other cryptocurrencies, or fiat currency.
Eg: MakerDAO, widely regarded as “the project that started the DeFi movement.
The first emerge was MakerDAO, which went live in December 2017, It is the ‘decentralized bank’ on Ethereum, issuing the stable coin DAI and the managed token MKR. Where DAI, the cornerstone of the entire DeFi ecosystem, utilises an automated over-collateralization + target rate feedback mechanism and is the largest and most tried and tested stable coin collateral solution on Ethereum.
eg; Compound called ‘a window into the DeFi space’ founded in September 2018, Compound is currently the dominant collateralized lending platform in the DeFi lending market. In 2020, Compound went live with the platform’s governance token, COMP, and the price shot up from $20 all the way to $320. The lending-is-mining mechanism made Compound an overnight success, with traffic skyrocketing, creating yet another cryptocurrency myth.
DEX, the decentralized exchange, is undoubtedly the “cornerstone that drives DeFi’s development. DEX is relative to centralized cryptocurrency trading platforms, and decentralized exchanges based on DEX have exploded with amazing development, such as the Kyber, dYdX, DDEX, Uniswap, etc. The total trading volume of DEX in the first six months of 2020 exceeded $3 billion, and the trading volume of single Uniswap once surpassed Coinbase and other centralized exchanges.
In 2019, Synthetix, an up-and-coming synthetic asset platform, is not only able to synthesize digital assets on its own, but also to purchase financial derivatives such as fiat currencies, commodities, stocks, and indices through virtual currencies, and its issued token, SNX, has soared nearly 800% in just six months, with SNX rising nearly thirty times in 2019.
Yearn, the fire can start a fire, “the fuse that ignites the world of DEFI
YFI full name Yearn. Finance, issue date July 18, 2020. The initial price of the issue is only $34. The whole project has no pre-mining, pre-selling, no team allocation, no institutional financing.