What is DeFi (What is the symbol of DeFi currency)?

What is DeFi currency? In the field of cryptocurrency, what does DeFi refer to? What is decentralized finance (DeFi)?

According to data from the University of California, Berkeley, in 2017, the value locked in the Bitcoin network exceeded $1 billion. This means that people can invest in and trade digital assets through a platform.

DeFi, on the other hand, is a network based on Ethereum, maintained by developers, investors, and others, providing lending services. Therefore, it can be seen as a subset of a new type of economic activity.

Specifically, in DeFi applications, users’ funds are fluid, with their interest coming from protocol fees or the cost of executing smart contracts. If a project wants to achieve high interest rate returns, it needs to pay a certain interest to participate in the lending market. When users want to earn more interest from the protocol, they can choose to deposit ETH or directly borrow digital tokens like USDT. Furthermore, for most ordinary people, investment products without a minimum threshold will not be accepted.

Currently, DeFi applications mainly include three types:

1. Collateral lending (such as Compound), Aave, Synthetix, dYdX, etc.

2. Staking of Dai (such as MakerDAO).

3. Lending of DAI, USDC, PAX, and other assets. (Bitcoinist)

According to statistics, as of December 31, 2018, the total locked value on Ethereum had reached $491 million, with MakerDAO accounting for $689 million and Synthetix approximately $140 million.

The relationship between DeFi and the traditional financial system is actually very simple. Firstly, the development of blockchain has brought about a large number of business opportunities. Secondly, blockchain technology has brought innovation, such as various new concepts and tools on the blockchain.

Lastly, due to the technological characteristics of blockchain, we often see new models, such as Automated Market Makers. This new model allows anyone to initiate orders off-chain to obtain prices without the need for intermediaries. However, to make these orders profitable, the process has become complex.

The main advantage of DeFi is that it can help solve pain points such as credit issues. For example, in some cases, you can provide collateral to borrowers and lenders or use smart contracts to create your own credit scoring system. At the same time, DeFi has various forms of security features, such as automatic liquidation and automatic hedging of risks. There are two mechanisms for asset management in DeFi: secure asset custody mechanism and automated trading strategy.

However, a drawback of DeFi is that it is relatively small and harder to predict. Because DeFi itself does not incentivize all participants’ interests or attract those who participate.

Although the current development of DeFi is slow, its growth rate is still fast.

What is the symbol of DeFi currency

According to CryptoGlobe, D is a new currency symbol and a set of digital units. It represents a whole new currency system (i.e., D) with intrinsic logic: a virtual item that can be considered as a store of value, a network composed of multiple participants, and a system supported by other assets. The protocol aims to make transactions simpler and provide users with more efficient payment methods. According to previous news, the U.S. Securities and Exchange Commission has classified Bitcoin as a non-fungible token (NFT) and considers cryptocurrencies as “investment tools” for regulation.