The total value of DeFi hedging exceeds US $ 1 billion, and the rise in ETH price is not the only reason

As Cointelegraph reported on February 8, as Ethereum broke the $ 200 mark yesterday, the value of cryptocurrencies now locked in the DeFi (decentralized financial) market reached $ 1 billion.

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Total value locked in the DeFi market, February 7. Source: Defipulse.com

As of February 7, the price of Ethereum was close to $ 220, up 4.5% on the day, and nearly 22% this week.

DeFi is short for Decentralized Finance, which refers to the use of blockchain, digital assets and smart contracts in financial services such as credit.

According to data from analysis site difipulse.com, the USD 1 billion locked in the Defi market, that is, smart contracts, protocols and decentralized applications (Dapps) built on Ethereum, almost 60% are stable currency DAI owned by MakerDAO .

Difipulse's data shows that today, a year ago, the value of DeFi lock-in was about a quarter, or $ 276 million.

While celebrating this milestone, relevant parties in the Ethereum community pointed out the role of the Bitcoin Lightning Network, which accounts for 1.7% ($ 8.5 million) of the total value of the Ethereum Defi, which is ten times for DeFi contracts and applications. One of the big digital assets:

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DeFi Total Value, Top Ten Digital Assets, February 7. Source: Defipulse.com

The website calculates the total value of DeFi by calculating the total balance of Ethereum and ERC-20 tokens in the DeFi smart contract and multiplying these balances by their US dollar spot price to calculate the total value every hour.

The total value of DeFi hedging is related to the price of Ethereum

Cointelegraph reported last fall that although the dollar value chart of digital assets locked in DeFi shows some correlation with the price of Ethereum, it does not depend entirely on the price of Ethereum.

After the price of Ethereum dropped in July 2019, the value of the assets locked by the DeFi application resumed growth despite the continued decline in the price of altcoins. In the short term, the correlation between the total value of DeFi hedging and the price of Ethereum will be closer.

Copyright Notice:

Original: https://cointelegraph.com/news/value-locked-in-crypto-defi-markets-hits-1-billion-milestone

Author: Marie Hulliet

Compilation: Captain Hiro

Source (translated): Babbitt Information (http://www.8btc.com/553251)