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DeFi Targets $1 Billion in Assets Under Management

Ethereum Price: $162.85
Ethereum Price (BTC): 0.018981BTC
ETH Locked in DeFi: 3.13M (2.86% of circulating supply)
Market Cap: $17.81B
ETH Network Dominance*: 67.53%
7 Day Candle**: $142.69 / $179.65 / $142.16 / $162.85

With last week’s rally in the price of ETH, the total value locked in Decentralized Finance jumped dramatically from $660 million to $830 million in the space of 7 days.

Total Value Locked (USD) in DeFi – defipulse.com

The sharp increase wasn’t only a result of a rallying ETH price. The total amount of ETH locked (and leveraged) in Maker has also been steadily increasing, indicating that those closest to Ethereum are expecting further gains.

Total ETH Locked in Maker – defipulse.com

Other developments have also been under way. PoolTogether, a “lossless lottery” application that operates in a similar way to the UK’s NS&I Premium Bonds, is beginning to make headway with total DAI locked doubling from $300K to $600K in just the last week.

A DeFi charity, rTrees, also launched, leveraging rDAI (a DAI derivative) to send interest income directly to Trees for the Future while the donor retains their DAI holdings. You can imagine a future where these donations are rewarded in non-monetary Ethereum NFTs or tagged onto a decentralized ID – providing real value in return for the donation but at zero cost to the non-profit.

Today, RocketNFT announced the first non-ETH/ERC20 collateral based lending system. Users will be able to borrow from the system using their Ethereum non-fungible tokens (NFTs or crypto-collectibles) as collateral, with each NFT valued on a case-by-case basis. This model is certainly a lot harder to manage but as liquidity for NFTs increases, the company could find themselves at the center of a burgeoning marketplace.

Aave Protocol, which launched at the start of January, operates in a similar way to that of another Ethereum protocol, Compound Finance. The key differentiator for Aave however, is in their introduction of “Flash Loans”, a method for borrowing cryptocurrency without the need for collateral: borrowing, using and returning the loan within the same Ethereum transaction.

These new developments in DeFi are but a fraction of what is going on in Ethereum and will no doubt play a major role in the price volatility of ETH over the coming 12 months and in the lead up to ETH 2.0.

Yet it’s incredible to think that DeFi, for all its impressive growth and future potential, is but a tiny subset of the development underway on Ethereum. The eclecticism of applications being demonstrated each week is remarkable, whether it’s the NBA’s Sacramento Kings’ Ethereum memorabilia or the low-level technical developments of StarkWare, there is a wealth of projects to be excited about.

In the next bull cycle, when Bitcoin’s blocks are filled once again to the tune of $20 per transaction, it will become devastatingly clear where the industry’s effort and intellect has been pooling over the last 3 years.

– Nick, Owner EthereumPrice.org

* calculated as: (ETH Market Cap / Ethereum Network Market Cap)
** open / high / low / close