From: Shazeb
What is Defi & Defi Token?
DeFi, which stands for “decentralised finance,” is an umbrella term for financial services on public blockchains, most notably Ethereum. It is a new financial technology that uses secure distributed ledgers like those used by cryptocurrencies. By using smart contracts on a blockchain, it can offer financial instruments that don’t depend on middlemen like brokerages, exchanges, or banks. In DeFi, the software takes the place of the middlemen. Furthermore, blockchain-based “smart contracts” make markets, settle trades, and ensure that the entire process is fair and trustworthy for everyone involved.
The Defi tokens are required to invest in DeFi. To explain further, several bank-like services, such as lending and insurance, can be accessed through Decentralized Finance Tokens (DFTs). Several archaic problems in the global financial services landscape are being addressed by DeFi. However, tokens issued by DeFi are considered high-risk investments because of their potential for large price swings.
The tokens issued by DeFi have the same ease of use and transparency as cryptocurrencies. The Uniswap (UNI), SushiSwap (SUSHI), PancakeSwap (CAKE), and Wrapped Bitcoin (WBTC) are all examples of DeFi tokens in use today. A large number of DeFi tokens are linked to DeFi protocols that, in some cases, are governed almost entirely by their user community. To participate in the decision-making for these protocols, you need to buy the token offered by that protocol. This type of Defi token is known as a governance token as it is used for the governance of the protocol.
As of 9th August 2022, the total market cap for DeFi tokens is $52.082 billion with a total locked value of $68.586 billion. Lido Staked Ether is leading the market cap with $7.324 billion followed by DAI and Chainlink with a market cap of $7.043 billion and $4.061 billion respectively.
What is the current trend in Defi Token?
The Defi tokens have been popular since their inception because they have higher utility. Thus, the tokens have been gaining popularity ever since. Even though the volatility of the cryptocurrency market is reflected in Defi tokens, they have still maintained a decent position in terms of price stability than the other cryptocurrency types.
Last 90 days
Looking at the past 90 days of the Defi token market cap i.e., 8th May to 8th August 2022, it is evident that the Defi tokens market cap faced a downward movement until the 20th of June. Subsequently, the demand-supply equation adjusted positively and the market cap steadily maintained an ascend. However, after the first week of July 2022, the market cap increased drastically and the momentum has continued to date.
Comparing the market cap of Defi tokens to bitcoin, we find a great difference between the two. In the last 30 days (9th July to 8th August 2022) and 1 year, bitcoin has market cap increased by 10.4% and the Defi market cap increased by approximately 27.5%. Thus, the Defi tokens outperformed Bitcoin by 17.1% which is humongous.
Last 7 days
The last seven days have been very happening for the Defi tokens. The market cap increased from $48.9 billion to $51.28 billion.
Furthermore, the Defi Tokens Dopex (DPX), Ribbon Finance (RBN), and REN (REN) have gained the maximum this week which is 68.7%, 37.6% and 35.8% respectively. These coins are further followed by Seedify.fund (SFUND), Bounce (AUCTION), Perpetual Protocol (PERP), and Liquity (LQTY) in terms of returns for the week.
Furthermore, the Defi Tokens Dopex (DPX), Ribbon Finance (RBN), and REN (REN) have gained the maximum this week which is 68.7%, 37.6% and 35.8% respectively. These coins are further followed by Seedify.fund (SFUND), Bounce (AUCTION), Perpetual Protocol (PERP), and Liquity (LQTY) in terms of returns for the week.
