DEFI NEW NORMAL: NEAR FINANCE PROTOCOL

DEFI NEW NORMAL: NEAR FINANCE PROTOCOL

If you have been following our page for a while, you should be familiar with DeFi by now. However, for the benefit of first-timers, we will talk briefly about what DeFi is.

Understanding Decentralized Finance

Decentralized finance aims to create a financial system that is completely different from the traditional finance system. It is a financial system that is open to anyone from anywhere in the world.

DeFi is an umbrella term used for financial services built on a blockchain. These services include but are not limited to payment, loans, and interest. DeFi does everything the traditional finance system does and more. However, what distinguishes it from the traditional finance system is that all services are done from the comfort of your home, office or anywhere you are in the world.

The Origin

DeFi is built on a blockchain network called Ethereum. Ethereum was created by Vitalik Buterin and Gavin Wood in 2013. At that time, Bitcoin was a popular blockchain network. However, Bitcoin only has a single function. Hence, the need for multiple blockchain network with a wide range of functionalities.

Ethereum birthed a decentralized network that allows anyone to build on it. Aside from being used as digital currency, it also processes other financial transactions, stores data and executes smart contracts. One of its major successes is the DeFi ecosystem.

DeFi is built on a permissionless and trustless ecosystem. However, contrary to what many people believe, the DeFi ecosystem is not fully decentralized. Does it make the DeFi ecosystem a scam?

DeFi, a scam or work in progress?

We have been made to believe that the DeFi ecosystem is fully decentralized. Whereas, in reality, it is far from the truth. One of the core features of DeFi is to cut out middlemen from our everyday financial needs.

It is unfortunate that many DeFi projects still haven’t cut out middlemen. Take, for example, the staking protocol. Locking tokens in a DeFi protocol requires a third party (middlemen). The Proof of Stake network allows users to stake a share or all their tokens.

The downside is that some stakable assets don’t pay rewards daily and mostly come with a lockup duration where stakers cannot access their assets. For example, if the price drops during the lockup period of staking, users will eventually incur a loss. What this means is that you have no control over your staking assets. This proves that the trustless and permissionless ecosystem is flawed.

Volatility

Volatility is another biggest bottleneck in the DeFi ecosystem. Undoubtedly, the major reason why people stake is that it enables holders to earn substantially higher APYs than other investment services. The staking market is a volatile one. If for example, you earn 20% APY on a staking asset and it drops in value over the year, holders will eventually incur a loss. So what is the way forward? The answer is...

The 100% DeFi Ecosystem

The only way to mitigate these risks and achieve a flawless ecosystem is to create a fully decentralized finance ecosystem.

Near Finance Protocol is paving the way and is set to lay a foundation for a truly decentralized finance system. Near Finance Protocol is the saviour the DeFi industry has been yearning for - a DeFi Protocol company that has everything the DeFi industry has been lacking.

Near Finance Staking Protocol: You don't need to lock up your assets to get rewarded. Near Finance Protocol is built on a non-staking reward system. It enables holders to hold, earn, govern and have full control over their assets.

Near Finance Protocol Reward System: To mitigate the effect of long reward duration, Near Finance Protocol enables holders to earn daily rewards. You can withdraw anytime and get your reward instantly.

Near Finance Protocol APY: To mitigate the effect and risk that accompanies the volatile market, Near Finance Protocol gives a standard and stable APY of 13.3% regardless of the market nature.

This is what a DeFi ecosystem should look like and we are glad to be part of this revolution.

All it takes to be part of the Near Finance Protocol ecosystem is to follow our pages and join our waitlist so you don't miss any important information.

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