What’s New In DeFi, December 21–31, closing chapter of 2019

January 08, 2020
What’s New In DeFi, December 21–31, closing chapter of 2019

Here’s what you need to know about the latest news & developments in the world of decentralized finance.

2019 Set the Stage for DeFi to Go Mainstream

The last three years have seen a lot of progress. Scaling is being addressed with various technologies including Plasma and Rollup showing great promise. We are seeing an increasing number of viable fiat on-ramps for both institutional investors (e.g. Bakkt) and consumers (e.g. Wyre). We’re starting to see standards set in foundational technologies like zero-knowledge proofs (via ZKProof.org). So the main element we need to solve, for now, is creating a product that people want. That people need. And there are two simple reasons why I believe that DeFi is poised to create that mainstream product in 2020…read more

Some Economists Really Do Get It

It is important to ask, “what problems are the new fintech platforms purporting to solve, specifically regarding payments?” Too many observers have false confidence in their belief that status-quo payment systems work well, ignoring two problems posed by traditional payment systems: (1) the high but hidden cost of payment latency, and (2) counterparty risk posed by traditional depository institutions. Those who ignore these problems are at risk of being blindsided by the trend that users will increasingly turn to these new payment systems precisely because they solve these two specific problems…read more

Why 2019 Was Actually A Secret Success For Blockchain In Financial Services

Now, as most of the 2020 blockchain predictions have settled in and the year is near its end, let’s review the highlights in the enterprise blockchain and digital assets space, especially in the financial services vertical. Measured by the quality of the projects in 2019, the companies originating them, and the projects’ complexity and advancements to date, it is safe to say that enterprise blockchain in financial services has a bright future and is prime for bigger adoption in 2020…read more

A Beginner’s Guide to DeFi

Decentralized finance, also referred to as “DeFi” or open finance, aims to recreate traditional financial systems (such as lending, borrowing, derivatives, and exchange) with automation in place of middlemen. Once fully automated, the financial building blocks of DeFi can be composed to produce more complex capabilities. Today, the primary venue for decentralized finance is Ethereum, but in principle, these ideas can be implemented on any smart contract platform. In this beginner’s guide to decentralized finance (“DeFi”) we review the following…read more

Pantera Partner Paul Veradittakit’s Crypto Predictions for 2020

2019 has been an incredible year for the blockchain and cryptocurrency space — we’ve been through immense market fluctuations, regulatory battles and financial scandals, Senate hearings, and the launches of several key abstractions that enable some really interesting applications. We’ve got some high hopes for 2020 — the innovations we’ve seen in the last year enable a diversity of awesome use cases for crypto, highlight some critical areas for improvement, and represent a huge advancement in the technicality and complexity of the industry…read more

Stablecoin Predictions & Trends for 2020

Let’s start in order of historical importance. Tether was one of crypto’s early killer apps because it emerged as the reserve currency of crypto to crypto trading and inter-exchange global liquidity. It rose to prominence in an era when most exchanges struggled to maintain banking relationships and process deposits and withdrawals in local currencies. Tether fits my mental model of technically illegal, but not necessarily unethical innovations, and its management has been an exercise in survival via obfuscation…read more

DeFi Trends for 2020

Maker: No longer the end-all-be-all for DeFi. The incredible progress of DeFi in 2019 can largely be traced back to MakerDAO, the industry’s most systemically important protocol. Maker’s Dai underpins the majority of the DeFi ecosystem and remains the largest and most battle-tested collateralized stablecoin solution. However, it’s no longer the only important DeFi protocol, and will likely face steep new competition on the lending and stablecoin fronts. MakerDAO led much of the growth in value locked in DeFi through the first half of the year, doubling from ~$250 million in January to ~$500 million in July. That’s when the rise of new DeFi protocols began in earnest. Maker now locks ~$330 million of ETH in DeFi, while protocols like Synthetix and Compound have locked $260 million combined. Maker “dominance” dropped from 90% at the beginning of the year to just below 50% today…read more

Thank You For Another Incredible Year

Today, to be a financial services company you no longer need a network of expensive physical branches, or a hoard of expensive salespeople to build your distribution network. Thanks to increased connectivity, the nature of being a financial services company and the relationship with its users is changing. For example, if Facebook acquired a banking license, it would have the largest distribution network of any financial services player in the world. Facebook has zero branches. Its best salespeople are the users of the social network itself…read more

Nike receives patent to tokenize shoes on Ethereum

Nike stated that it intends to generate unique IDs and create ERC 721 tokens for some shoes. People can “unlock” these tokens by purchasing physical shoes and these tokens can then be linked with unique owner IDs to signify ownership. Besides representing a digital shoe, the token can also record the so-call genotype information of a digital shoe, including specific attributes, colors, styles, backgrounds…read more

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