What can be the reasons for this exponential growth of #DeFi?

[anu1908]

the product is there but it is obviously over hyped. one projects got a lot of user base and their token rise like crazy. other projects try to do the same thing and traders are using this to keep hyping it so they got more money from retail traders. it's definitely 2017.

[1715041777]

1715041777

[bbc.reporter]

Despite a lot of skepticism about DeFi projects, I see them as a good prospect, as they offer real financial services to participants in this market. The emergence of various civil transactions on blockchain technology and using smart contracts solves issues that were previously in the hands of banks. Now DeFi began to really compete with banks, because loan, credit, and deposit agreements have ceased to be the privilege of banks.

The Defi concept, similar to ICOs, is not a scam, however its implemenation with the backing of speculative assets that are very volatile in nature might cause it to implode during bear markets. You know how the cryptospace bear markets are hehehe. It is a dump of more than 10% on the first day and continues to lose up to 90% of value in most cases.

[Kunnu]

These days DeFi projects are on full peak and as we know some defi coins/tokens have been very profitable in the past few weeks that's why mostly people are getting involve in defi projects and the numbers are increasing day by day so I think the mass inclusion of people can be the main reason of this exponential growth of defi.

[wack slacker]

Projects are overblown, I know that many different DEFI projects existed before. LEND has dropped about 12 times as its capitalization returns to around $ 8 million recently LEND's capitalization has increased by 100 times. New DEFI cryptocurrencies have responded to the bullish wave and FOMO is here.

[Kotone]

the product is there but it is obviously over hyped. one projects got a lot of user base and their token rise like crazy. other projects try to do the same thing and traders are using this to keep hyping it so they got more money from retail traders. it's definitely 2017.

This is true. Sometime some project renounced as defi could get more than 3x than their base price. Still the market are interested totally huge hype for a none product projects. Same things with the ICO of 2017, maybe more people will get complained later on.

[jrrsparkles]

Story of ICOs in 2017 is repeating again with the new ideal called defi, it is getting overhyped initially by the news media now every investors are running towards it even by selling the ethereum and bitcoin to invest on such a shit again,I don't know how many lessons they want to learn to stop falling for such kind of hype traps.

[amishmanish]

ICOs were enabled by Ethereum's ERC-20 taken standard as well as the ability to implement contracts for depositing and paying back tokens. They gathered money in the name of shiny ideas, of which the majority turned out to be over-promised. Most devs were not able to implement anything remotely useful and this just led to easy exit scams.
DeFi has the same nature but a much more focussed but obscure one. Earlier, you could just get to the gist of the idea by reading up a little. DeFi projects take this complexity to another level. The entry level is also pretty high. DeFi already has a lot of projects underway and it needs big money for significant profits. DeFi essentially lets you offer your holdings to the platform which can then use it as liquidity for lending to others. Traders borrow this and the liquidity providers get part of profits. Its easy to say that the higher amount of "funds" you have to lock up, better chances you have to earn.

DeFi will also end up being as good as its devs. High quality devs means genuine products (what they are in DeFi would be a book in itself). Yet, the profits will have already been made. Normies don't really have much of a chance till the scam ICO devs turn their attention to these and the next cycle of hyper-speculative tokens starts.

[albon]

In my opinion, this is a new financing system, and this system has succeeded in stablecoins, loans, and the main elements and has great privacy advantages. Therefore, this attracts early investors in abundance, like what happened in any new financing or investment system that was established before and whenever an idea or system develops, this system grows in its early years, collects huge investments and gives great returns to investors, and then it comes back naturally after the hype ends.

[Sebas.tian]

Exactly it's "hype". Well, I'd say we are on the brink of being crowded on the defi space and sooner or later we'll see scams involving defi. Scammers are looking now into this industry just like what happen way back 2017 with the crowded ICO on place. Just my opinion but my hunch tells me it will be the same as to this defi.

Scams had already infiltrated the #defi ecosystems and it will be an extension of what happened back in 2017. At this junction, investors should be more careful than before because the game changer's has entered into the market. We saw what happened to YAM token, this should be recognize as an example of what's to come into the system in future. Am very much careful not to get into the hype to that extent I loss my sense of belonging. #defi is an over hype ecosystem and care must be taken not to loss one assets to them.

[tycsols]

It is just a new trend, personally i do not find anything special in defi till now. Yes, it can be good but only when masses will be able to access them and also defi projects would be able to offer all banking facilities just like real, physical banks offer, till then defi is just a new attractive selling point and nothing else.

[JungleOnion]

The reason is that they are the new kid on the block meaning lots of speculation and hype can be generated around this concept so that naturally will interest traders that want to profit from volatility. Until there are exact usage and real world value, expect them to pump and dump as much as people are willing to pay for them. DeFi meme coins are the plague this year.

[bitgolden]

It is probably the fact that some of them make a ton of money and the numbers are close to 2 billion dollars right now, so a lot of them got super amount of attention just because of the buzzword defi since few of them got people rich, the other ones looked like they might as well. However people are forgetting that just because one was good doesn't mean all others are good neither.

Look at bitcoin, it is the biggest coin out there right? There is absolutely no other coin that is bigger, yet there are crypto coins who are proof of work and have similar stuff right? Yet they are very low. People will forget about all these defi as well when they realize it is not all defi that is great, it is just some of them are good and most of them are horrible and the hype dies after that.

[arufox]

Short answers because "Hype" same case with ICO 2017, Doge Pump TikTok and many more. The positive side hype also can bring a lot of profits but the negative site is too risky, popular example is YAM project. But for me, I will stay away from any hype situation. But we can't say that all defi have increased due to hype, many projects based on defi are good

[semobo]

Have a look at the Digital Asset Market Performance of last week.  What can be the reasons for this exponential growth of #DeFi?




👍 https://www.bitcurate.com is the best place to analyze, research, understand, and forecast your #cryptocurrency investments.

New idea so definitely got hyped when chain-link entered into the market which resulted into lot of projects with the same decentralized platform idea.But the growth is overhype for sure so at some time it will get hit too hard so investors are making this quick opportunity to make quick profits.

[dimonstration]

Other than hype, we know that DeFi is somehow good and useful that makes people notice it first. Unlike in ICO some DeFi projects were improved and really doing their best to be noticed and serves its purpose like Chainlink who's been performing well even before these hype. The purpose of DeFi is to make a better financial system and many projects there are fresh in ideas, only due to its popularity this time that some projects appears with no real usage and just riding the hype like Yam.

[Westfiled]

Every Defi projects are getting a serious hype that is huge. The hype around Defi projects is attracting a lot of attention towards Defi. So many people are investing in Defi projects now and that has led to the exponential growth that we are experiencing right now.

The hype should be the main reason. Even the non-defi projects have already started to release their defi to the market to get the hype. People were also investing in the defi caused by when they were getting the right project and they can get a very huge profit too from there. it's all about the hype

[chikator]

I would say it was the hype. A lot of people on every platform is DeFi this and Defi that. Cant be helped that a lot of people would be drawn to check it out.