The development of DeFi still has no killer applications

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2 years ago

Recently, the prices of projects in the DeFi field have risen, and many projects have continued to soar. COMP, AAVE, YFI, and UNI have both broken through new highs. Everyone feels that DeFi is back in the arena.

In fact, the meaning of DeFi is decentralized finance. Conceptual products have been around for 2 years, but in the second half of last year, the currency price of related conceptual projects became more known to more people, so there are more borrowing and liquid mining. , Insurance, financial derivatives and other applications.

It has changed the usage habits of more people from off-chain to on-chain. This is a change we can see, but the main form of DeFi is liquid mining, which encourages people to lock up their coins to obtain new tokens. , And whether the new tokens are worth, whether the old project tokens will go down, this is the component of the gambling.

Everyone sees that there are many popular applications where project tokens are very valuable. In fact, most people don’t make money. First of all, the purpose of capturing this popular application is to keep trial and error, just like no matter how powerful an investor can guarantee Every target project will become a unicorn. This requires a long process, but this process has been infinitely shortened in the application of DeFi, so that in less than half a year we can already evaluate some of the leaders in the DeFi field. Sheep, what we saw in September last year were those dragon heads, but in January this year we still saw them.

In the continuous upgrade and iteration, the DeFi project gradually optimized the user experience, and still did not solve the two core problems: long-term benefits and operational thresholds.

Many DeFi projects have the function of liquid mining, but the longer the mining time, the less the profit, and even some projects release most of the project tokens 10 days after going online, so that the long-term retention of users cannot be guaranteed. Moving to the next pool to mine again, consuming GAS fees back and forth, which is also the root cause of congestion on the chain.

Since the popularity of DeFi, there have been hundreds of applications on the chain, but the user's threshold for operation is still very high. There is no project application that allows most users to operate foolishly. This is also currently unable to attract more external users. main reason.

Bill Gates used Microsoft to lower the operating threshold of computers, Steve Jobs used Apple to lower the operating threshold of mobile phones, and Elon Musk used Space X to lower the operating threshold of lunar exploration. What about DeFi?

Some people say it is AC. I don't think so. He just used the scalability of the blockchain to create more high-quality projects, but did not achieve the goal of lowering the threshold. On the contrary, the NFT application of NBA Top Shot has driven some fans to understand and use cryptocurrency. It uses NBA players’ action packs as card collections. Its value is anchored to NBA players, so it can gain such a huge influence and make more circles. NBA fans inside use this app (including me of course).

Therefore, DeFi is still in an early stage. Even now, we are still using mainstream applications that have been hot last year. The new applications do not have any big moves. If you think GRT, INJ, and LRC are rising fast, then you must take a look. They did not appear when they were launched last year. During this period, a lot of testing, preparation time, and the high quality of the project itself gained a lot of attention after going online, and they only provide more scalability on top of the existing system. It is not working hard on the barriers of entry, so the mission of facing global users is a long way to go.

All in all, from the current situation and trend of DeFi, a killer application is needed to import more ordinary users and funds, not just a game with funds in the circle.

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