Why DeFi Can’t Be Wrong
You know what people are saying.
Voters vote with paper and pen. The market votes with money, and therefore, the market always wins.
Decentralized finance (DeFi), as the blockchain local finance service, has been witnessing an explosion in market interest and capital since March 2020, with TVL (Total Value Locked) growing more than 30x.
DeFi continues to boom as Ethereum prepares to test the ATH price level repeatedly. This coincides with significant growth in some of the top DeFi platforms. With DeFi tokens breaking their all-time high prices, more people are flocking to alternative financial systems with better borrowing and lending rates.
Although transaction fees on Ethereum were at record levels, DeFi platform usage continued to rise. DeFi crypto market cap is $83.84 billion, down 20.70% from the last day.
From the peephole, we can see that the authority is surprisingly willing to implement the new regulation that would block withdrawals from regulated crypto wallets to unknown addresses and essentially require an allow list of remittance recipients, disposable personal addresses, unverified merchants, and smart contracts. This will appropriately replicate the accessibility problems of modern banking and create a two-tier system of crypto financial services.
If you’re a crypto lover, your disgust is obvious. 😠
If you are a crypto lover, your taste is shared because the reaction indicates how devastating and ideal it is. 😁
Decentralized finance (DeFi) represents the crypto community’s most important asset as a blockchain-specific financial service. It should remain open, decentralized, permissionless, unattended, and pseudonymous.
We want to say that the whole idea of DeFi is based on an evident and watery philosophy that is immediately outdated and alienates any regulation and clampingimposed on this industry.
DeFi is new, fresh, different, and creative destruction. If capitalism is about disrupting the status quo with creativity and innovation, then it should embrace DeFi.
And now imagine a bankless future, a completely new financial system from the ground up: payments, lending, insurance, asset issuance, barter, data generation, and monitoring.
The list could go on and on.
Any rational mind will be overwhelmed by the workload. You must go through a long and tedious process of rigidly FDIC-insured financial system and e-commerce accounts and eventually land on a crypto equivalent.
Yet over the past two years, the crypto space has produced the building blocks to do just that.
“A parallel financial system first requires a synthetic dollar; the creation and management of this asset require basic credit facilities and reference data infrastructure to maintain the asset’s fixed value; obtaining and scaling competitive rates and spreads with centralized solutions requires large incentives for capital providers; If you understand how these markets can work, you will have to deal with the lack of circuit breakers and chargebacks; you will need to protect deposits from “bank runs” and hacks; You will need knowledgeable risk managers who set protocol defaults, defenses to prevent application-consuming attacks, and low-cost insurance against technical failures.”
Decentralized finance, Maker (crypto dollars), Uniswap (automatic market-making), Compound (liquidity mining), Balancer (dynamic liquidity pool rebalancing), YFI (intelligent asset management), Aave (flash loans), ChainLink (data) oracles ), SushiSwap (defense measures), CVP (proxy collection), and bZx (decentralized error reward protocol), we have examples of the building blocks needed to power a fully decentralized and algorithmic financial system.
However, we believe DeFi is right.
Despite these impressive developments, the DeFi sector still accounts for around 5% of the total cryptocurrency market capitalization, which currently stands at 1.70 tons.
Despite representing only a tiny percentage of the total crypto market, DeFi’s rapid growth indicates that the industry is poised for explosive growth as cryptocurrency becomes more mainstream.
It would be wrong if we did not participate in constructing the DeFi world of the future.
Posschain will provide cross-chain end-to-end payment privacy for the entire DeFi stack. One of the most critical components of Posschain products is the Hidden DeFi Bridge, where users can hide their transaction history, as it is compatible with all Posschain DeFi products. It can be fully compatible with the DeFi ecosystem thriving in Uniswap, AAVE, Compound, and Polkadot.
Posschain is a Substrate-based cross-chain privacy protocol. It is built as a native privacy layer that can provide end-to-end anonymity for the entire DeFi stack. The Posschain applies zkSNARKs to the Zether framework to construct a second-layer decentralized anonymous module. It will then be imported as a substrate-based smart contract. The objective of Posschain is to enable cross-chain privacy-preserving payment and trading systems while protecting the transparency of your assets and behaviors from surveillance.