How To Boost Your Business Using 5 DeFi Solutions

boost business defi solutions decentralized finance dex exchange

● DeFi lending 
● Wealth management 
● Decentralized exchanges (DEXs) 
● DeFi insurance products 
● Financial information 

It is clear by now that blockchain technology is radical. A decade ago when the anonymous Satoshi Nakamoto inaugurated blockchain tech and bitcoin to the world, he disclosed a revolutionary DeFi (Decentralized Finance) system. If you have been actively or passively engaging in the blockchain sector, then you have probably heard about DeFi; the first system to introduce online peer-to-peer transactions in the absence of an intermediary. 

Without any doubts, blockchain tech and bitcoin have been revolutionary and will certainly change the world. However, they are yet to supersede the current centralized financial framework (CeFi). Alternatively, digital currencies and the blockchain technology underpinning them have assisted in advancing the traditional finance framework for the last decade. 


Decentralized Finance involves cryptocurrencies, smart contracts, protocols, and Dapps built over the blockchain. The adaptability and magnitude of development on the Ethereum Network make it an ideal choice for the implementation of DeFi. However, that doesn’t mean it is the one and only blockchain platform with DeFi capabilities. 


The DeFi industry is currently in a frenzy, with the total value locked in DeFi estimated to be worth more than $4 billion in assets. Notably, the DeFi space is developing at a rate of almost half a billion USD each week as investors and entrepreneurs alike seek asylum from a decentralized financial structure unattached to any authority or organization. 

More interestingly, institutional investors and fiat-based finance professionals are finding their way into DeFi, as an escape plan from what is frequently described as an unfashionable and illiberal financial system. The DeFi ecosystem is presently driven by Ethereum, whose interoperability assists businesses to range products by simply utilizing different innovations in the industry. 

Additional funds will be injected to create more DeFi solutions as the sector develops. There are a couple of mind-blowing projects that have either been or are set to be released, that have the DeFi community in turmoil. Justifiably, the community is at the heart of DeFi, one of the reasons it edges traditional finance. 

Entrepreneurs and interested parties should keep watch of the sector as it grows and keeps drawing substantial financial outlays. To better understand how to boost your business using DeFi solutions, here are some fintech sectors that decentralized finance is disrupting: 

Solution 1 - Lending 

DeFi lending solution is underpinned to the strengths of the Ethereum blockchain. The network makes possible guileless and safe protocols to procure and obtain funds that are incentivized through a range of cryptocurrency rewards. DeFi has brought about non-collateralized loans, higher compounding interest compared to traditional financial institutions, and peer-to-peer lending without the need for third-party intermediaries. 

Lending in the DeFi space is experiencing exponential growth with businesses making the most out of the composable architecture that enables applications to incorporate and develop on top of one another forming an extensive network. This permissionless procedure drives innovation at the same time promoting a fair competition, an ingredient that the traditional financial system lacks. 


Solution 2 - Wealth Management 

The DeFi space offers some crucial benefits when in regards to portfolio management. Some of the advantages enjoyed as per DeFiRate include: 

● Non-custodial ownership of the underlying assets 
● Accessibility: Can be accessed from anywhere in the world 
● Automated wealth management 
● Composability 
● Privacy and anonymity 

The only potential disadvantage is that the users are entirely in charge of their assets, and there are no security measures to protect or recover lost assets from the wallets. Regardless, DeFi solutions are becoming increasingly interactive and easier to use aiding users to better manage their assets. 

Solution 3 - Financial Information 

In the traditional financial markets, financial data and information such as pricing and information dissemination are governed by a few individuals. For instance, in the United States alone, the financial data providers industry is worth approximately $15 billion but just a few stakeholders govern it. DeFi solutions will aid in democratizing how information is obtained, pricing, how info is presented, and form a rewards structure that galvanizes the players in the market. 


Solution 4 - Decentralized Exchanges (DEXs) 

Decentralized exchanges (DEXs) allows the users to have absolute power over their funds held in separate wallets. This mitigates the risk associated with storing assets in centralized exchanges, which are subject to hacking resulting in the loss of funds. 

Decentralized exchanges are gradually gaining traction, having transacted more than $790 million over the past 30 days. This indicates that DEXs are gradually eating away the market share of the decentralized exchanges. As more and more fiat and assets find their way into the digital space, they will possibly end up being traded in decentralized exchanges in the long run. 

Typically, regulatory bodies are likely to slow down this procedure, but connoisseurs in the field reckon the power of decentralized finance considering how we manage our wealth. 

Solution 5 - DeFi Insurance 

Insurance policies are fairly recent in the cryptocurrency sector. Centralized exchange platforms only recently started ensuring client funds to reinforce the security of customer funds. Whether it is in the traditional finance sector or the erupting DeFi industry, insurance is ubiquitous, and that is where DeFi insurance comes into play. 

As stated earlier on, there are no safety measures in play to safeguard users against mistakes. DeFi solutions through insurance products can help curtail the risk of loss associated with such mistakes in business. The insurance can be implemented on liquidity pools, wallet addresses, and the smart contracts used in DeFi lending and staking. 

There are several DeFi insurance solutions providers currently who aid in developing a transparent and convenient ecosystem. The main aim of such DeFi solutions is to annihilate traditional providers who have dominated various industries by making insurance more cost- effective and supple to all users. 

Bottomline 

DeFi has been the erupting trend in 2020 within the blockchain and finance sector. Generally, it appears that decentralized finance is thriving and will definitely last. Many people across the globe are now largely enlightened on the flaws of the centralized solutions in business and investment products. For instance, centralized exchanges have frequently reported losing client funds through cyberattacks

Even though the sector is in its infancy, there is a wide variety of thrilling projects and, noteworthy, in DEXs and the money market zones where users can take part such as Uniswap, Yearn Finance, SushiSwap among others.

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