In the field of cryptocurrencies, a new market segment is rapidly gaining popularity — decentralized Finance. The price of the coins associated with it increases and brings investors multiple profits. We tell you about new assets, where to buy them and why it is extremely risky
A new industry — decentralized Finance (DeFi) - is rapidly gaining popularity in the cryptocurrency market. These are applications, exchanges, services for issuing loans and opening deposits, and much more. The key idea of such platforms is that developers do not have control over users ' funds.
For example, the most popular decentralized platform now is Uniswap. To trade on it and other similar exchanges, the user does not need to create an account and leave funds on it. They are stored in your personal wallet. And Uniswap connects traders, the transaction takes place directly between their wallets.
Many DeFi projects have their own cryptocurrency. Mostly, these are tokens issued on the Ethereum blockchain. Due to the fact that the new sector is gaining popularity and gaining more users, the price of coins for decentralized applications is growing.
For example, over the past 3 days, the exchange rate of the Ring DeFi token of the Darwinia Network project has increased by about 100%, from $0.025 to $0.051, at the moment rising to $0.057. Growth for the month — 1250%. Over the past day, the Unitrade coin shows similar dynamics,
also related to the DeFi sector, it has risen by 200% over this period
Over the past month, DeFi tokens have risen in price by 500-1000%. What is it?
In the field of cryptocurrencies, a new market segment is rapidly gaining popularity — decentralized Finance. The price of the coins associated with it increases and brings investors multiple profits. We tell you about new assets, where to buy them and why it is extremely risky
A new industry — decentralized Finance (DeFi) - is rapidly gaining popularity in the cryptocurrency market. These are applications, exchanges, services for issuing loans and opening deposits, and much more. The key idea of such platforms is that developers do not have control over users ' funds.
For example, the most popular decentralized platform now is Uniswap. To trade on it and other similar exchanges, the user does not need to create an account and leave funds on it. They are stored in your personal wallet. And Uniswap connects traders, the transaction takes place directly between their wallets.
Many DeFi projects have their own cryptocurrency. Mostly, these are tokens issued on the Ethereum blockchain. Due to the fact that the new sector is gaining popularity and gaining more users, the price of coins for decentralized applications is growing.
For example, over the past 3 days, the exchange rate of the Ring DeFi token of the Darwinia Network project has increased by about 100%, from $0.025 to $0.051, at the moment rising to $0.057. Growth for the month — 1250%. Over the past day, a similar dynamics is shown by the Unitrade coin, also belonging to the DeFi sector, during this period it has risen by 200%.
Separately, it is worth highlighting the just token, issued by Tron founder Justin Sun. In early July, the businessman announced the launch of 3 DeFi-products JUST Lend, JUST Swap and JUST BTC. Since that moment, the exchange rate of the just coin, which will become a key link in this ecosystem, has increased by about 750%, the current value is $0.042
There are many similar examples with multiple increases in the cost of DeFi tokens. And this attracts more and more traders to the decentralized Finance market. On the one hand, this is good for the industry, as it provides an influx of capital. It is likely that it will continue to grow, because most of the players in the cryptocurrency market have not yet met the DeFi sector.
On the other hand, as in the case of the ICO boom of 2017, many scammers came to the sphere. They issue tokens on the Ethereum blockchain (this can be done in 20 minutes without having programming skills). Then the coins are added to Uniswap, since the platform is decentralized, there is no strict listing procedure. The main goal of this is to sell inexperienced users a cryptocurrency that does not have a real product behind it.
To do this, scammers use several strategies. For example, they create the illusion of a working product with a ready-made site and a well-developed roadmap. Then they advertise the project via social networks. But this option is quite expensive, so there are simpler ones.
One of them is to create a token with a name that matches another existing and popular asset. For example, the Geeq token currently has at least 7 clones.
Another method of fraud is pump channels in social networks. DeFi tokens often become more expensive immediately. Therefore, traders who have become familiar with the new sphere try to buy such coins as early as possible. In other words, the key factor is information: the earlier you know, the more likely you are to buy cheap.
In pursuit of information, traders look for channels in social networks that are the first to report the listing of a new DeFi token on Uniswap and other exchanges. The creators of such groups can use this demand for their own purposes. For example, you can issue your own token that does not have any product under it, and then inform subscribers about its addition to the platform.
Fraudsters are only part of the risks that a user who is interested in DeFi tokens may face. Their capitalization is small,
in this regard, the exchange rate is extremely volatile. It can grow and fall by tens or even hundreds of percent per day, especially when there is news about the addition of coins to famous exchanges.
The yfi token of the yEarn Finance platform caused the most noise. The startup issued a coin with the clarification that it is completely useless and offered to "stay away from it". Despite this, the exchange rate of the asset from July 18, the day of issue, to July 25, soared by 13,000%, from $35 to $4800. Now YFI is trading at about the same level, although at the end of July the price fell to $2600.
