Simplifying DeFi: How we’re powering the free movement of crypto liquidity
When whispers of decentralized finance (DeFi) first started emerging in 2019, there was palpable excitement among crypto natives. With lessons learned from 2017’s breathtaking market surge and subsequent challenges, several projects embarked on the rapid development of applications to invite growth — as reflected by the value of assets locked in smart contracts.
That single metric continues to be the yardstick used to measure DeFi growth, with some $247 million total value locked (TLV) in 2019 growing over 1,400% to this year’s all-time high TLV of roughly $14.4 billion (DeFi Pulse).
It’s the fastest-growing crypto sector, no doubt. Yet, questions linger around its true potential — given that this amount is still shy of 3% of the total value of crypto assets in circulation (around $500 billion, Coinmarketcap).
Blockchain DeFi — the umbrella term denoting a range of apps and protocols that allow for asset management minus traditional financial intermediaries — was supposed to have created easier and wider access to financial services for everyone.
The idea that anyone could access storage, transfers, loans, trading, and investment services that otherwise would be out of reach, or difficult, in the real world was a tantalizing prospect. Yet if access was now made easier with DeFi, why has it yet to fully take hold with the wider crypto community?
DeFi is not (yet) so straightforward
Aside from market characteristics (lower liquidity and limited range of markets, for example), one of DeFi’s major barriers to entry is that using many of the early DApps and protocols isn’t as straightforward for the novice crypto user.
While crypto wallets have taken considerable strides in improving user experiences, most consumer apps now work similarly to regular payment apps. Furthermore, the ease of use for DeFi has primarily been limited to the Ethereum platform. Thus, users on other blockchain networks would have to first exchange their assets for Ether to participate in the most popular DeFi protocols.
To help bring other networks into new bustling DeFi ecosystems, there are new types of wrapped — or tokenized — assets pegged to popular crypto like Bitcoin, ETH, and EOS. These wrapped tokens enable the underlying assets, which are usually siloed to their native blockchains, to become compatible with non-native blockchains.
pNetwork, for example, enables cross-chain connections amongst 5 different blockchains, empowering users to peg-in 25 assets, including LTC, BTC, EOS, ETH, and popular DeFi tokens like YFI, MKR, and LINK. This allows users on Litecoin, Bitcoin, EOS, and Ethereum networks to access DeFi on non-native blockchains.
Powering the free movement of crypto liquidity
At pNetwork, we’ve made it our motto to be “the heartbeat of cross-chain DeFi composability” — we want to be enablers of DeFi for all crypto users, regardless of the blockchain they use.
For this to happen, we understand that crypto users must have the fast and easy access that DeFi promised. This is why pNetwork:
- Builds automated issuance of assets as soon as collateral is supplied — no need to gather and submit documentation.
- Offers best-in-class security with continuous auditing and guaranteed full transparency, along with a growing network of node operators.
- Designs simpler and intuitive user interfaces that average users can easily understand — no need to be tech-savvy to pTokenize your assets.
Savvy with DeFi already? Then you can access even more sophisticated strategies like pNetwork’s liquidity mining incentives on Steroids.finance.
We truly believe in the promise of decentralized finance to democratize and empower people. But we also understand that we need to overcome the walled-garden limitations of each blockchain.
🔗 For any blockchain project looking to integrate pTokens into their infrastructure, we have also built a pTokens JS library.
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