Decentralized Finance or DeFi in short, is a financial system by which financial products become available through blockchain instead of middlemen, making them open for anyone to use. DeFi makes it possible for buyers, sellers, lenders, and borrowers to interact with each other through open software without having to rely on middlemen.
And this innovation has been groundbreaking!
DeFi has grown substantially in the last few months. With close to $80 billion dollars worth of assets locked in smart contracts, DeFi is slowly becoming a major player in the world of Finance and has the potential to disrupt major financial markets in the coming years.
But DeFi still has a long way to go if it has to establish itself as a major player in the financial world. There are few obstacles that are currently keeping DeFi from unleashing its full potential. Once DeFi finds a way around them, there will be no stopping it.
Problems With DeFi
DeFi apps such as Compound, Aave, Curve, Yearn etc allow users to lock their funds in smart contracts and then lend, borrow or simply let funds accrue value through different financial mechanisms. And this has been a game changer as the current financial institutions cannot compete with the interest rates being provided by DeFi protocols.
But DeFi has been a victim of its own success. The high in-flow of people has increased the network congestion , which in turn has led to the skyrocketing gas fees. This makes it exceedingly difficult for retail investors to access DeFi.
One might argue that Layer 2 (L2 for short) such as Polygon is a solution. But L2 has its own problems, namely lack of composability and fragmented liquidity. Many DeFi applications are dependent on one another, so for them to work on L2 , all the applications need to be on the same network, and that’s easier said than done.
Another major problem of DeFi has been the high learning curve. For users to really use DeFi they need to have an in-depth understanding of wallets, transactions, gas fee, blockchain etc. And this is excluding the new information required for L2 or cross-chain.
Apart from the above mentioned problems, DeFi space is a bit unorganized at the moment. There are myriads of different protocols with really great opportunities but it’s really hard to discover them. And even if they are discovered it’s hard to verify if the project is genuine or not. Moreover, there is a lack of insurance as well as customer support to protect the retail users.
These are major problems which need to be solved before there can be a mass adoption of DeFi. And this is where NeoFi comes in.
NeoFi — The Gateway to DeFi
NeoFi is a CeDeFi bridge on top of the existing DeFi application layer. The CeDeFi layer merges all the transactions of the users on its network and provides users with an unified DeFi experience. All the transactions are settled on the mainnet in one single transaction.
NeoFi drastically reduces the barrier to entry for the retail investors. Additionally, NeoFi allows the support for other chains to be integrated and be part of the DeFi ecosystem.
Through NeoFi,
- Users can swap DEX listed tokens without any gas fee
- Users can interact (stake, lend, provide liquidity etc ) with Defi protocols all from one place and without any gas fee.
- Users can manage and discover new opportunities in the DeFi space.
- A user is insured against potential scam exits and rugpulls.
Market Opportunity
DeFi has grown considerably in the past few months but the number of users in this space is still very less compared with the total number of people who have invested in cryptocurrencies.
According to estimates, there are currently 120+ million investors of cryptocurrency but a mere 1.7 million of them use DeFi. That is the less than 2% market share. NeoFi aspires to unlock DeFi for the rest of the 118.3 million.
NeoFi vs Current Solutions — In Action
Swap
Staking
$NEOFI Token — The Heart Of NeoFi Ecosystem
$NEOFI is the native token of NeoFi. Holding $NEOFI tokens gives users access to platform discounts, platform governance, and access to opportunities in the NeoFi ecosystem. Moreover, all DeFi protocols supported on NeoFi will automatically be pegged to NEOFI tokens.
Note: $NEOFI is a deflationary token. That is a part of the fee paid in $NEOFI is automatically burned.
Conclusion
NeoFI is working to onboard new users to the DeFi space. We believe our efforts will not only revolutionize the world of DeFi, but also level the playing field in the market by bringing more tools aimed at retail investors in the market.
Do you agree with us that NeoFi is needed to make DeFi safer and more accessible to retail? Share your thoughts in the comments.
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