DeFi week selection 丨 How to play DeFi in 2020? Top investment institutions and project parties give you answers

DeFi content this week includes:

  1. DeFi data for one week
  2. Dragonfly Capital: Three major priorities for DeFi in 2020
  3. Messari Founder: DeFi Trends in 2020
  4. Placeholder: DeFi Déjà Vu
  5. Xie Yanjian: Risks in DeFi Smart Contracts
  6. Weekly DeFi event review
  7. to sum up

According to the data provided by Defipulse, the DeFi market has remained relatively stable in the past week. As of press time, the total market lock-in value was about 666 million US dollars, of which the number one Maker market share was about 49.69%, and Synthetix was about 26.1%, Compound is about 13.7%.


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Dragonfly Capital: Three major priorities for DeFi in 2020

DeFi is actually Internet finance in the true sense. Next, there are still many areas where DeFi needs to be improved. In a new article published by Dragonfly Capital managing partner Haseeb Qureshi, three major priorities for DeFi are proposed in 2020:

  1. The first is to improve the efficiency of the system by reducing the excess mortgage rate : most consumer mortgages have a down payment of 5-20%, which makes the total loan mortgage rate of 105-120%, while the 150% excess mortgage rate in the DeFi market is generally The financial sector is unheard of (the reason for such a high mortgage rate is mainly the volatility and latency issues of crypto assets).
  2. After driving down the mortgage rate, DeFi's second priority is more diversification of synthetic assets : Maker and UMA are two agreements pursuing this goal, and we expect to see a series of comprehensive financial assets soon. In the future, anyone with a mobile phone can buy any financial asset they want from anywhere in the world.
  3. Finally, DeFi also needs to treat users differently : the agreement does not treat every user as a blank piece of paper, but should consider past history. If your address performs well on other DeFi platforms, then you should be eligible for lower interest rates and better credit. This requires building a bridge with the real world, while introducing identity, it also needs to address privacy issues.

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Placeholder: DeFi Déjà Vu

In the historical development of finance, there are some important models, the most notable of which are systemic crises related to the collapse of asset prices or income streams and the recurring interaction between financial innovation and regulation. In his latest article, The DeFi Déjà Vu , written by Placeholder researcher Mario Laul, he highlights some historical precedents related to open finance and considers the potential long-term impact of DeFi's latest wave of financial innovation. It concluded that:

"Financial services provided using open source protocols and decentralized networks will continue to exist. In the past, concerns about consumer protection, market integrity and economic stability played a decisive role in determining the basis of financial regulation and institutions (and every time (Both represent a crisis). Cryptofinancial technology offers unique opportunities to achieve financial democratization and improve the efficiency and transparency of the economic system. However, it also has the potential to generate new forms of systemic risk, especially as crypto assets and The role of DeFi applications in coordinating real economic activities is growing. As the complexity of the DeFi system increases, the ability of humans to understand and directly control or dominate it may decline. And time will tell us whether this is worth looking forward to Characteristics."

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Xie Yanjian: Risks in DeFi Smart Contracts

Nervos Chief Architect and CEO of Mystery Technology Jan Xie explained in his latest article " The Smart Contract Risk in DeFi " that attackers may affect all users by attacking the Ethereum token contract, which makes it The risk of ERC token is greater than ETH. He also mentioned some data of the decentralized insurance project Nexus Mutual in the Ethereum ecosystem, and based on these data, it is estimated that the current annual risk cost of smart contracts is about 2%.

The design idea of ​​Nervos UDT, compared with ERC token, will have better decentralized attributes, but it will still be lower than native tokens. In addition, Xie Yijian also introduced the implementation characteristics of Nervos DAO.

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Messari founder: 10 trends in DeFi in 2020

Ryan Selkis, the founder and CEO of blockchain analysis company Messari, gave 10 trend predictions about DeFi in his year-end summary. Here are 5 of the more interesting points:

  1. DeFi is still relatively centralized. Many DeFi protocols claim to be open, non-licensed, anti-censorship, etc., but it is too early to believe this ambitious proposition;
  2. If 2019 is the DeFi loan year, then 2020 will be the DeFi derivative year;
  3. The success of MolochDAO, MetaCartel, and MarketingDAO in 2019 proves that DAO can effectively coordinate human financial actions, and in 2020, "for-profit purposes" DAO may also reappear in order to realize the vision that The DAO did not realize in the year ;
  4. Centralized exchanges will start testing DeFi;
  5. DeFi wallets will burst, and InstadApp, Zerion, Linen and Argent may get more financing in 2020;

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Weekly DeFi event review

  1. MakerDAO Foundation completes $ 27.5 million in financing : Venture capital funds Dragonfly Capital Partners and Paradigm purchased 5.5% of the total MKR from the MakerDAO Foundation at a cost of $ 27.5 million. These two investment institutions will actively participate in the decentralized governance of the MakerDAO agreement.
  2. Kyber announced plans for protocol upgrades and token model changes ;
  3. Release of real-time salary payment agreement Sablier ;
  4. The emergence of a profitable DAO MetaCartel Ventures focusing on DApps ;
  5. OKEx integrates Dai deposit rates ;

to sum up:

For DeFi in 2020, major investment institutions and project parties have high hopes. Some have proposed improvements, such as reducing the pledge rate and introducing credit ratings. Some have proposed the security risks and solutions of the existing agreements. , We can also see that new DeFi applications (such as profitable DAO, real-time salary payment applications) are constantly being born, and centralized exchanges are starting to try DeFi … and all this seems to be a signal of another year next It's a bumper year for DeFi.