DeFi has Multi-chain, Stocks & Stablecoin focused!

Multi-chain, stock, and stablecoin focused DeFi protocols are showing signs of strength.

The DeFi space is seeing the rise of a new type of protocol that combines multiple blockchain solutions with traditional financial securities. These protocols are targeting investors who want to trade in stocks, stablecoins, and cryptocurrencies from a single interface. In addition to making, it easier for investors to access all their trading options, these protocols are also making it more affordable since there is no need to pay transaction fees on multiple blockchains.

For the past several months, the crypto community has been captivated by the rise and fall of DeFi protocols.

The first wave of protocols like Compound, Maker, and Aave captured a lot of attention in 2019 but were fairly simple in their design. They allowed people to lend out their stablecoins (a digital currency that is pegged to a fiat currency) and earn interest on these loans. This was great for lending institutions like banks because it helped them make more money by loaning out their assets. However, it was not very helpful for consumers who wanted to borrow money and just wanted to pay interest at the lowest possible rate.

In 2020, several new protocols were launched that implemented multi-chain support, allowing users to earn interest on both Ethereum and Binance smart chain assets. Stablecoin focused protocols like Curve Finance and Yield Protocol also introduced a new way of earning interest on your stablecoins called staking or liquidity mining where you could lock up your coins in order to receive rewards instead of just paying interest over time with an annual return rate (APR). These two types of DeFi protocols have gained traction recently as they offer better incentives than traditional lending platforms while still being fairly easy to use.

The most popular protocols in this category include Polygon and Binance Smart Chain. Both offer DeFi services that allow users to trade across a number of different blockchains including Ethereum (ETH), Bitcoin (BTC) and Litecoin (LTC). They also have solutions for trading traditional assets such as stocks or commodities like gold or oil.

These multi-chain solutions provide an alternative to centralized exchanges like Coinbase Pro where there is only one blockchain available for trading activities. By moving trades off-chain into Ethereum’s smart contracts, they remove the need for third party custody providers like Coinbase Custody or Fidelity Digital Assets which could potentially face regulatory issues in certain jurisdictions due to their centralized nature.

DeFi, or decentralized finance, is showing signs of strength on multiple fronts. A new crop of multi-chain and stablecoin focused DeFi protocols have popped up recently to take advantage of the current crypto market situation.

New protocols are emerging to better utilize existing cryptocurrencies and digital assets. These new protocols are leveraging stablecoins as a means to allow for instant liquidity, cross-chain asset transfers, and even cross-chain derivatives trading.

Protocols like Synthetix (SNX), yEarn (YFI), Yearn Finance, Curve Finance (CRV), Terra Virtua Kolect (TVK), and SushiSwap (SUSHI) all have their own unique use cases and differentiators, but they also share many similarities. One similarity they all share is that they are all built on top of the Ethereum blockchain. Even though these protocols are all built on Ethereum, they do not solely operate with Ethereum’s native token Ether (ETH). In fact, most of them operate using a basket of stablecoins like USDC, DAI, TUSD, USDT, and sUSD to provide instant liquidity.

While some of these protocols might not be accessible to mainstreet investors yet because they require advanced knowledge in order to participate in their markets, there is a lot that we can learn from the ideas behind these projects as well as the underlying technology powering them.

Yield farming is the hottest trend in the DeFi (decentralized finance) space right now. But the question is: how long will it last?

There are two types of yield farming protocols in the market: single-chain and multi chain. The single-chain ones, such as Yearn.finance, focus on a specific blockchain to provide their services, such as Ethereum. You can think of them as a “closed shop”.

The multi-chain ones, such as Curve.fi and SushiSwap, work across different blockchains and provide liquidity between them by making use of tokens that have the same value on each chain. These are more like an “open market”, where multiple people come together to offer different products and services.Farming and liquidity incentives for DeFi protocols have been steadily increasing.

The latest trend in the DeFi world has seen a surge of demand for a new type of protocol, which combines aspects of both staking and liquidity provision.

These protocols allow users to provide liquidity by locking up an asset (like ETH) to mint tokens that represent that asset, and then lock those tokens up to stake them in a pool which rewards them with another token. The most popular examples of these types of DeFi protocols are LID (Link Inflation Distribution) and CAB (Chain Asset Backup). These protocols essentially combine staking with lending into one single action – as users are able to lock their assets in order to earn interest without having to sell them or buy anything else.

DeFi protocols that facilitate multiple chains, stablecoin lending and decentralized stock trading are showing promising signs of strength.

We covered Aavegotchi and Acala, two DeFi protocols that have recently gone live on the Ethereum mainnet. Both projects have unique features that set them apart in the space.

Aavegotchi is a digital collectibles platform (NFTs) where users can mint and trade non-fungible tokens (NFTs). These NFTs take the form of “Aavegotchis”, which are playful creatures that are directly linked to an Aave lending pool. The more users deposit into certain pools, the faster the Aavegotchis evolve. This could lead to new features being unlocked like breeding and battling.

Acala is a decentralized finance hub for Polkadot that offers both a stablecoin pegged to the US dollar, as well as a decentralized exchange for trading stocks. It also has a lending protocol that allows anyone to earn interest by depositing stablecoins into its liquidity pools.

Recent developments in the DeFi space have been mainly focused on a few protocols that are less affected by the Ethereum network congestion. DeFi protocols that operate on multiple chains have gained a lot of popularity in recent weeks, with many users moving to them from Ethereum-based DeFi platforms.

Protocols like Synthetix and BancorX, which operate on both the Ethereum chain and Binance Smart Chain (BSC), have seen their 24-hour transaction volumes jump by more than 150% since last week.

DeFi protocols focused on stablecoins, like Curve and Aave, also saw huge gains this week after the stablecoin-focused lending platform Compound added support for Uniswap’s UNI token. The UNI token is currently being used as collateral to borrow DAI from Compound, leading to an increase in transaction volume for both Curve and Aave.

Stocks tokens also seem to be attracting a lot of interest from cryptocurrency traders lately. FTX’s new line of stock tokens has already experienced a great deal of trading volume since its launch, and rival exchange Binance is preparing to launch its own line of stock tokens soon as well.

DeFi protocols that focus on multi-chain support, stock tokens, and stablecoins are seeing signs of strength in terms of user activity.

According to the report from the cryptocurrency analytics firm CryptoPioneer, decentralized finance (DeFi) protocols that focus on multi-chain support, stock tokens, and stablecoins are showing signs of strength in terms of user activity.

Protocols like Bancor, Synthetix and Compound have enjoyed significant growth over recent months. The report stated:

“These [protocols] allow users to pool funds together to provide liquidity for many different types of assets including stocks and bonds, commodities, ERC-20s, cross-chain assets like BTC or ETH on Ethereum as well as cross-chain assets between other chains.