In its short history DeFi – decentralised finance – has created billions of dollars of wealth, writes Maxim Bederov, serial entrepreneur, venture capitalist and blockchain technology expert.
This niche portion of cryptocurrency seeks to take traditional financial products like lending and payments, and plug them into a crypto-denominated system. It used smart contracts to auto-execute most of its functions, and Ethereum is the underlying platform on which most smart contracts are based.
In order for smart contracts to properly execute, Ethereum’s internal transaction pricing mechanism, called gas, must be spent.
And we heard last month that Ethereum had smashed all historic transaction fee records as DeFi has ballooned.
But the DeFi tide may now be turning. Read more in my recent article.