What is DeFi (Decentralized Finance)? Characteristics, Prospects, and 11 Related Virtual Currency Stocks

This site is a great place for me (@mifsee(2) has been working on company and stock analysis while learning privately.

This is only a record of my personal analysis and the contents may contain errors or information that differs from the actual situation. Please understand in advance when viewing this site.

Introduction.

Unlike the traditional Internet, Web3 has broken away from centralized control to create a new digital world that is more open and transparent.

This innovative concept will bring a new growth cycle to the entire virtual currency market, making it accessible to everyone.

So there,DeFi, a decentralized financial system based on blockchain technology, attracting attentionwill take a detailed look at how it works, its features, its future potential, and related virtual currency stocks (altcoins).

What is DeFi?

DeFi stands for "Decentralized Finance.

This is,It refers to a system that provides financial services without a centralized administrator (e.g., a bank or brokerage firm).

Specifically, smart contracts (execution programs based on rules set on the blockchain) built on public blockchains (mainly Ethereum) allow users to directly trade, finance, and manage their assets.

In traditional financial systems, a central administrator acts as an intermediary to manage assets and process transactions, but in DeFi, these roles are automatically performed by program code called smart contracts, allowing users to use financial services directly, transparently, and securely.

in this way, ,DeFi aims to decentralize financial services and create a new financial ecosystem to which everyone has equal access.

Background of DeFi's Creation

DeFi (decentralized finance) emerged as a reaction against the traditional centralized financial system.

In the traditional financial system, a centralized organization such as a bank or financial institution manages assets and intermediates transactions, which has the following problems

• Dependence on centralization:The traditional financial system relies on a central authority, which can result in a lack of transparency in transactions and high fees. In addition, users may be constrained by the operations and sanctions of the central institution.
• Lack of financial inclusion:Many people do not have bank accounts or access to financial services due to geographical constraints, and DeFi aims to provide equal access to financial services to these people.
• Financial crisis and poor risk management:The 2008 financial crisis (Lehman Brothers collapse) exposed the fragility of the centralized financial system. This led to increased demand for a more transparent and risk-managed system.

Technical Background and Evolution

Several important technological developments have contributed to the development of DeFi.

• The advent of Bitcoin:Bitcoin, introduced in 2009, was the first to implement distributed ledger technology (blockchain), enabling the transfer of value without a central controller. This is where the underlying concept of DeFi began.
• Ethereum and Smart Contracts:Ethereum, which was introduced in 2015, provided a platform for smart contracts, automatically executed contracts that can be executed on the blockchain. This enabled the automation of complex financial transactions and the elimination of a central controller.
• Emergence of diverse DeFi protocols:In 2018-2019, various DeFi protocols (systems for the decentralized provision of financial services), such as Uniswap, Compound, and Aave, emerged to provide decentralized exchanges (DEX), lending platforms, liquidity pools, and other services The market is now in a state of flux.
• The yield-farming epidemic:Yield Farming, a new asset management technique using virtual currencies, began in 2020 when Compound began distributing Governance Tokens (COMPs), which attracted a large influx of funds into the DeFi protocol. This led to a rapid expansion of the DeFi ecosystem, which expanded liquidity and earned interest and rewards in return.

DeFi has developed rapidly against the backdrop of these technological developments and dissatisfaction with the traditional financial system. It continues to evolve today and continues to drive the decentralization of financial services.

What is your specific image of DeFi use?

The following is a brief image of the specific use of DeFi (decentralized finance),

Deposit virtual currency instead of savings and earn interest

For example, just as you deposit money in a bank and receive interest, you can deposit virtual currency on the DeFi platform and earn interest on the currency you deposit.
The Aave platform allows users to deposit virtual currencies such as Ethereum (ETH) and USDT (Tether) to earn interest.

Virtual currency exchange (swap)

For example, if you have Bitcoin (BTC) and want to exchange it for Ethereum (ETH), use a decentralized exchange (DEX) such as Uniswap. Here, you can exchange virtual currency directly with other users without a central administrator.

Loans

For example, if you have a sudden need for money, you can borrow using the virtual currency you have as collateral; with Aave, you can borrow USDT using ETH as collateral, and the ETH pledged as collateral is deposited until repayment is completed.

Providing liquidity to generate revenue

For example, as a liquidity provider (LP) at Uniswap, you deposit ETH and USDT into a pool and are rewarded with a portion of the commission for transactions made in that pool. This is called liquidity mining.

Get paid for staking.

For example, by staking the virtual currency you have, you can contribute to the operation of the network and earn additional virtual currency as a reward. Virtual currencies such as Chain Link (LINK) can be staked.

These uses are similar to traditional financial services, but are unique in that they are conducted using blockchain technology without a central administrator.
This allows users to engage in more transparent and free financial activities.

What are the advantages of DeFi?

The benefits of DeFi (decentralized finance) are manifold.
Below are the key benefits.

Full asset management rights

With DeFi, users have complete control over their own assets. In a traditional banking system, deposited assets are managed by the bank and may be operated without the user's knowledge, but this is not the case with DeFi.

Elimination of geographic restrictions

DeFi can be accessed from anywhere with internet access. Anyone, regardless of nationality or place of residence, can use the same financial services, so financial activities are not limited to a specific geographic area.

Censorship resistance and anonymity

No centralized financial institution restricts or censors transactions; because DeFi operates on a decentralized network, no government or bank can stop transactions, and users can conduct transactions anonymously.

Available 24 hours a day, 365 days a year

Instead of being tied to the business hours of traditional financial institutions, DeFi operates 24/7 on the blockchain. Therefore, immediate settlement is possible at any time.

Reduced transaction costs

The DeFi platform does not involve intermediaries, which keeps transaction fees low. For example, in a decentralized exchange (DEX), transactions take place directly between users, thus reducing costs compared to a centralized exchange.

Composability

DeFi will make it easier to build new services by combining multiple smart contracts and protocols. This will provide a greater variety of financial services and save development costs and time.

Expansion of investment opportunities

DeFi offers a variety of financial products and services, allowing users to generate passive income through lending, yield farming, and staking. This provides new investment opportunities not available in the traditional financial system.

These advantages have made DeFi an innovative alternative to the traditional financial system.

What are the disadvantages of DeFi?

DeFi (decentralized finance) offers many advantages, but at the same time there are several disadvantages and risks. Below are the main disadvantages.

• Risk of Self-Responsibility:.DeFi has no centralized administrator, so all transactions and investments are at your own risk. In the unlikely event that you lose your assets due to a hack or a bug in the smart contract, no one will compensate you.
• Virtual Currency Preparation Required:. Virtual currency is required to use DeFi. For example, transaction fees and staking require virtual currency such as Ethereum, which must first be purchased on a virtual currency exchange.
• Regulatory Uncertainty:.DeFi is a rapidly growing field and regulations have not kept pace. In the future, regulations may be introduced in various countries, which may affect the operation and use of DeFi. In particular, there are already moves toward regulation in the United States.
• Technical Risks:.Because of the reliance on smart contracts, bugs and security holes in the code may exist. There is a risk of loss of assets due to these technical flaws.
• Price volatility risk: -1.5The price of virtual currencies is highly volatile and can fluctuate significantly in value over a short period of time. This entails the risk of a sharp decline in the value of invested assets.
• Complicated operation: -Complicated operation: -Complicated operation: -Complicated operation: -Complicated operationDUsing eFi requires a certain level of technical knowledge. Wallet setup, understanding smart contracts, and transaction procedures tend to be difficult for beginners.

Understanding these disadvantages and managing risk appropriately is important when using DeFi.

What possibilities open up with DeFi?

The use of DeFi (decentralized finance) opens up a variety of new possibilities.

Below are the main possibilities.

Improving Financial Inclusion

Because DeFi can be accessed by anyone with an Internet connection,Available to those without bank accounts and in areas with limited financial services.This will promote global financial inclusion.

Cross-chain technology

Cross-chain platforms are emerging that move assets seamlessly between different blockchains, allowing access to a greater variety of assets and protocols.

tokenize

Real assets such as real estate and art can be represented as digital tokens and traded on the blockchainThis will increase the liquidity of assets and allow more people to invest small amounts in expensive assets.

Distributed Autonomous Organization (DAO)

A community-based governance model is developing,Allows users to participate in the decision-making processThe project is designed to be a fair and transparent management of the project.

Increased scalability and efficiency

By adopting Layer 2 solutions (e.g., Optimistic Rollups, zk rollups, and other virtual currency transaction technologies that are fast and low-cost),Transaction speeds will be increased and gas costs (fees in virtual currency transactions) will be significantly reduced.

Enhanced Privacy Technology

Privacy protection technologies such as zero-knowledge proof and zk-SNARK will be implemented to protect user information and maintain transparency.

Diversified Insurance

Automated insurance protocols using smart contracts are emerging, offering new insurance products that protect users against smart contract vulnerabilities and platform failures.

Integration with centralized finance (CeFi)

The boundaries between DeFi and CeFi are blurring, with centralized exchanges collaborating with DeFi projects to offer new financial products and services. This will lead to greater integration between the traditional financial system and DeFi.

With these possibilities, DeFi is expected to significantly transform the modern financial system, providing a more accessible, efficient, and inclusive financial environment.

What is the key to choosing DeFi stocks?

When choosing stocks related to DeFi (decentralized finance), there are a few important points to keep in mind.

• Project White Paper Contents:A white paper is a document that describes in detail the project's objectives, business model, and technical workings. If the content is sufficiently detailed, it can serve as a basis for judging the credibility and potential of the project.
• Type of underlying blockchain:.Many DeFi projects are built on Ethereum, but others include Solana and the Binance Smart Chain. Understanding the characteristics of these blockchains and the reasons for their adoption can help evaluate the stability and scalability of a project.
• SNS buzz:.It is also important to check how much people are talking about it on social networking sites such as Twitter and Discord. If it is a hot topic, it is likely to be noticed by many users and has a high liquidity. However, it is important to do your own research and not be swayed by others' opinions.
• Project Use Cases and Utility:.Need to see how the project is actually used and what problems it solves. For example, Uniswap is widely used as a decentralized exchange (DEX) and is useful for real transactions.
• Reliability of the development team:It is also important to find out if the project's development team is reliable and to examine their past performance and experience with other projects. Projects with many partnerships are also rated as more reliable and promising.
• Market reaction and evaluation:.Check how the stock is valued in the market in terms of market capitalization, trading volume, and price fluctuations. Stocks with high market capitalization and trading volume can be said to be more liquid and stable.
• Identify regulatory and legal risks:.DeFi is a relatively new field and is often subject to regulation. It is important to consider future regulatory risks and to choose projects that are legally stable.

By comprehensively considering these points, you can reduce the risk involved in selecting DeFi stocks and make safer and more promising investments.

What products are hot at DeFi?

The following are DeFi products that are noted for their innovative technology and practicality.

Uniswap (UNI)

• Overview: (in Japanese only)Uniswap is a widely used decentralized exchange (DEX) platform that allows users to exchange virtual currencies directly without a central administrator.
• Points of Interest:.The efforts to strike a balance between maintaining user anonymity and regulatory compliance have been well-received.

Curve Finance (CRV)

• Overview: (in Japanese only)Curve Finance is a decentralized exchange specializing in stable coin-to-coin swaps. It is used by many DeFi users because of its low slippage and low fees.
• Points of Interest:.Particularly attractive platform for liquidity providers to generate stable revenues.

Aave (AAVE)

• Overview: (in Japanese only)Aave is a lending platform that allows users to deposit virtual currency to earn interest or provide collateral to borrow virtual currency. It supports a wide variety of virtual currencies, allowing for flexible operations.
• Points of Interest:.The company is popular in the DeFi market because of its extensive features for security and user convenience.

Chainlink (LINK)

• Overview: (in Japanese only)Chainlink is a distributed oracle network that provides external data to smart contracts. This allows smart contracts on the blockchain to access reliable data.
• Points of Interest:.It provides essential infrastructure for DeFi projects and is used in many projects.

Polygon (MATIC)

• Overview: (in Japanese only)Polygon is a platform that provides a Layer 2 solution for scalability and transaction speed. Various DeFi projects are deployed on Polygon.
• Points of Interest:.It is favored by many DeFi users for its lower transaction fees and fast transaction processing.

Each of these products has unique features and strengths and is expected to play a major role in the DeFi market.

Featured Virtual Currency Stocks Related to DeFi

Below are DeFi-related virtual currency stocks of interest.

Ethereum (Ethereum, ETH)

Ethereum is an open source blockchain platform with smart contract capabilities. It uses its own currency, Ether (ETH), to perform transactions and smart contracts.
A unique feature of Ethereum is the ability to place programs (smart contracts) on the blockchain that are automatically executed when conditions are met.

Ethereum is widely used for the development and operation of distributed applications (dApps), including

• Decentralized Finance (DeFi):. Lending, trading, staking and other financial services.
• NFT (Non-Flattenable Token):.Tokenize ownership of digital art and collectibles.
• DAO (Distributed Autonomous Organization):. Organizational management for transparent and efficient governance.
• Smart Contracts:.A program of contracts or transactions that are executed automatically.

Features include

• Smart Contracts:.A contracting function that automatically executes when conditions are met increases transparency and efficiency.
• Extensive ecosystemNumerous dApps exist, offering a wealth of tools and resources.
• Security and decentralization:.Blockchain technology makes tampering and fraud difficult.
• EIP-1559:.Fee models that improve the predictability of transaction fees.
• Ethereum 2.0:.By moving to Proof of Stake (PoS), the company aims to increase transaction speed and reduce gas costs.

Ethereum is the centerpiece of the DeFi ecosystem, offering a wide range of applications and high reliability.

Real-time stock price chart for Ethereum (ETH)/USD

Uniswap (UNI)

Uniswap is a decentralized exchange (DEX) that runs on the Ethereum blockchain. Serving as a platform that allows users to exchange virtual currencies without a central administrator, Uniswap employs an "Automatic Market Maker (AMM)" model that uses liquidity pools to enable the automatic exchange of tokens.

Uniswap is widely used in the following applications

• Token exchange: (1)Users can exchange tokens directly between wallets without a central administrator.
• Liquidity Provider:.Users deposit tokens into the pool and earn fees as liquidity providers.
• Working with the DeFi Ecosystem:.Work with other DeFi protocols to provide complex financial services.

It has the following features

• AMM Model:.Automate token exchange using liquidity pools instead of traditional order books.
• Governance Token (UNI):. Users can use UNI tokens to propose and vote on protocol upgrades and improvements.
• Open Access:.Anyone, from anywhere, can use the wallet simply by connecting it.
• Low cost and high speedRelatively low transaction fees and high transaction speeds.

Uniswap makes virtual currency trading simpler and more efficient through its innovative AMM model and integration with the broader DeFi ecosystem.

Uniswap (UNI)/USD real-time stock price chart

Aave (AAVE, AAVE)

Aave is a decentralized lending platform that runs on the Ethereum blockchain Founded by Stani Kulechov in 2017, Aave allows users to deposit virtual currency and earn interest or provide collateral to borrow virtual currency Aave's unique features include, flash loans and collateral swaps.

Arbe is widely used for the following applications.

• Virtual Currency Lending and Borrowing:.Users can deposit virtual currency to earn interest or provide collateral to borrow virtual currency.
• Flash Loans:.A special loan feature that allows the borrower to borrow instantly without collateral and repay within the same transaction.
• Collateral Swap: (1)The user can exchange the collateral asset for another asset during the borrowing process.

It has the following features

• Flash Loans:.The ability to borrow immediately without collateral and repay within the same transaction allows for efficient arbitrage transactions and asset redeployment.
• Governance Token (AAVE):. AAVE token holders can participate in voting on protocol proposals and improvements.
• Diversified collateral assets:.Many virtual currencies can be used as collateral, providing users with flexible options.
• Liquidity provider compensation:.Liquidity providers can earn interest on deposited assets.

Arbe is a highly popular lending platform in the DeFi market due to its innovative features such as flash loans and diverse collateral options.

Aave (AAVE)/USD real-time stock price chart

Maker, MKR

Maker is a decentralized stablecoin issuance platform running on the Ethereum blockchain, founded by Rune Christensen in 2015 and operated through its flagship project, MakerDAO. Maker's protocol provides a mechanism to generate DAI, a price-stable coin, by providing collateral assets; MKR tokens are used for governance and risk management; and Maker's protocol is used for the issuance of DAI, a stablecoin with a stable price.

Makers are widely used for the following applications.

• Stable Coin Issuance:.Users pledge ETH or other virtual currency as collateral to generate DAI, which is pegged to 1 U.S. dollar and characterized by price stability.
• Lending and Borrowing:. DAIs are used throughout the DeFi ecosystem and users can borrow or lend DAIs to earn interest.
• Governance: TheMKR token holders may participate in voting on changes to the Maker protocol operations and risk parameters.

It has the following features

• Stable Coin (DAI):.DAI reduces the risk to the volatility of virtual currencies because of its price stability.
• Decentralized Governance:.MKR token holders will be able to participate in key decisions of the protocol, ensuring transparency and democracy in governance.
• Risk ManagementDesigned to maintain the value of the DAI at $1.00 at all times through an oversupply of collateral. The type and percentage of collateral can be adjusted in response to market fluctuations.
• Security and Transparency:.Using smart contracts, all transactions and collateral management are published on the blockchain, ensuring transparency.

Maker is recognized as a project with high transparency in governance and risk management, serving as a foundation for the entire DeFi ecosystem by providing price-stable stabled coins.

Maker (MKR)/USD real-time stock price chart

Compound (COMP)

Compound, a decentralized lending platform running on the Ethereum blockchain, was founded in 2018 by Robert Leshner and Geoffrey Hayes to allow users to lend (lending) or borrow virtual currency ( borrowing). The Compound uses smart contracts to automate these transactions, increasing transparency and efficiency. The governor token, COMP, plays an important role in the operation of the protocol.

Compounds are widely used in the following applications

• LENDING:.Users can deposit virtual currency on the platform and earn interest.
• Borrowing: Borrowing: BorrowingUsers can borrow other virtual currencies as collateral.
• Liquidity Provider:. By depositing virtual currency into the pool, you receive interest as a liquidity provider.
• Governance: TheCOMP token holders may participate in proposals and voting on protocol changes and upgrades.

It has the following features

• Automated Smart Contracts:. The Compound will use smart contracts to automate the lending and borrowing process. This improves the transparency and efficiency of transactions.
• Governance token (COMP):.COMP tokens are used in the governance of the protocol and allow holders to participate in key decisions.
• Immediate earning of interest:.When users deposit assets, they earn interest immediately, allowing for effective use of assets.
• Market-based interest rates: (1) Interest is determined on a market basis based on supply and demand and is adjusted in real time.
• Diversity of collateral:.Flexibility to use various virtual currencies as collateral.

Compound is a platform that plays an important role in the DeFi market due to its automated lending and borrowing process, ability to participate in governance, and flexible collateral options.

Compound (COMP)/USD real-time stock price chart

Chainlink (Chainlink, LINK)

Chainlink, a decentralized oracle network for providing external data to smart contracts, was founded in 2017 by Sergey Nazarov and Steve Ellis to enable smart contracts on the blockchain to access external real-world data access to external real-world data. In this way, Chainlink significantly improves the utility of blockchain technology.

Chain links are widely used in the following applications.

• Price Feed:.Provides accurate asset pricing information in DeFi applications. For example, it is used for pricing on decentralized exchanges (DEX) and lending platforms.
• Forecast MarketProvide data for smart contracts to operate based on external event data such as sporting events or election results.
• Policies: InsuranceAssist in the execution of automated insurance policies based on weather data and other real-time information.
• Games and NFT:.Provide a data feed to determine the rarity of random events and NFTs in the game.

It has the following features

• Distributed Oracle Network:.Chain links improve data reliability and security by using multiple independent oracle nodes to retrieve data and eliminating single points of failure.
• Smart Contract Scalability:.Enable complex applications that operate based on real world events by allowing smart contracts to access external data.
• Cross-chain interoperabilitySupport the movement of data between different blockchains to improve interoperability across the blockchain ecosystem.
• LINK Token: LINKLINK tokens are used within the network to pay for Oracle services and also serve as a reward for Oracle node operators.
• Security and Transparency:.The Oracle of Chain Link has the ability to track the source of data and the performance of providers, ensuring transparency and trust).

Chain links play an important role in expanding the range of applications of blockchain technology by providing a reliable infrastructure for smart contracts to access external data.

Chainlink (LINK)/USD real-time stock price chart

Polkadot (Polkadot, DOT)

Polkadot is a next-generation blockchain protocol aimed at achieving interoperability between different blockchains; it was proposed by Gavin Wood (co-founder of Ethereum) in 2016 and is supported by the Web3 Foundation. Polkadot is designed to allow multiple parachains (individual blockchains) to run in parallel and allow them to exchange data with each other.

Polkadots are widely used in the following applications

• InteroperabilityEnable the exchange of data and value between different blockchains, improving interoperability across the ecosystem.
• Para Chain:.Developers can create their own blockchain (para-chain) optimized for a specific use and connect it to the Polkadot network.
• Governance: TheDOT tokens can be used to participate in proposals and voting on network operations and upgrades.
• Security Pools:.Multiple chains share a single security pool, eliminating the need for each chain to be individually secured.

It has the following features

• Relay Chains: Relay ChainsPolkadot's central blockchain, which mediates communications between all para-chains and maintains security for the entire network.
• Para Chain:.Individual blockchains optimized for specific applications will be connected to the Polkadot network to provide scalability and flexibility.
• Governance: TheDOT token holders can participate in proposals and voting on network upgrades and operations, allowing for decentralized decision-making.
• Security: SecurityPolkadot's design ensures that the para-chain shares a common security and is highly secure.
• Scalability: TheThe relay and para-chain structure allows for high transaction throughput and improves the scalability of the overall network.

Polkadot has become a key protocol for the next generation blockchain ecosystem due to its highly interoperable and scalable design.

Real-time stock price chart for Polkadot (DOT)/USD

Binance Smart Chain (Binance Smart Chain, BNB)

Binance Smart Chain (BSC) is a blockchain designed to provide smart contract functionality. introduced by Binance in 2020, it runs in parallel with the Binance Chain. the BSC is compatible with the Ethereum Virtual Machine (EVM), allowing existing Ethereum-based DApps and tools to be easily migrated.

BSC is widely used in the following applications

• Decentralized Finance (DeFi):. DeFi applications, such as PancakeSwap, exchange virtual currency, provide liquidity, and yield farming.
• Smart Contracts:.Developers can deploy smart contracts on the BSC to execute complex transactions and automated processes.
• Cross-chain communication:. BSC supports cross-chain communication with the Binance chain, allowing tokens to be moved between different blockchains.

It has the following features

• High Speed Trading:.The BSC uses a consensus mechanism called Proof of Staked Authority (PoSA) to generate a block approximately every three seconds for high-speed transactions.
• Low costTransaction fees (gas costs) on the BSC are very low and economical.
• EVM CompatibilityBSC is Ethereum compatible and existing Ethereum tools and DApps can be easily migrated.
• Governance: TheBNB token holders can participate in proposals and voting on network operations and upgrades.

BNB (Binance Coin) functions as the BSC's native token and is used for gas payments, staking, and cross-chain operations. In addition, quarterly token burns reduce the supply and stabilize the value of the tokens.

Binance Smart Chain (BNB)/USD real-time stock price chart

Solana (Sol, SOL)

Solana, a fast and scalable blockchain platform, was founded by Anatoly Yakovenko in 2017 with a mainnet launch in 2020. Solana's unique feature is its use of a consensus mechanism based on a combination of Proof of History (PoH) and Delegated Proof of Stake (DPoS). This design allows Solana to achieve very high transaction throughput and low transaction fees.

Solana is widely used in the following applications

• Decentralized Finance (DeFi):.Solana's high throughput and low cost make trading on DeFi platforms and decentralized exchanges (DEX) fast and inexpensive; platforms such as Raydium and Jupiter are representative.
• NFT: NFTLow transaction fees make it an attractive platform for artists and collectors, with NFT marketplaces such as Magic Eden and Solanart.
• Games and Entertainment:.High-speed transaction processing also makes it suitable for Web3 games and metaverse applications.
• Settlement: (1)A quick and low-cost payment system can be established using the Solana Pay protocol.

It has the following features

• Proof of History (PoH):.A mechanism that digitally records the passage of time and verifies the order of transactions. This enables fast and reliable transaction processing.
• Low costVery low average transaction fees of $0.00025, making it economical for a wide range of users.
• High throughputIt can process thousands of transactions per second and provides scalability to meet application needs.
• Staking: Staking By staking SOL tokens, you can contribute to maintaining the security of the network and earn rewards.
• Energy efficiencyLow energy consumption and environmentally friendly blockchain through a combination of PoH and DPoS.

Solana is a fast and efficient blockchain platform that is being touted for its innovative technology and extensive ecosystem.

Solana (SOL)/USD real-time stock price chart

What is the virtual currency Solana (SOL)? Current Price, Future Prospects, and Future Outlook

Among the many virtual currencies, including Bitcoin and Ethereum, Solana (SOL) has been attracting attention in the market for its high-speed transaction processing capability and low cost of operation. This article delves into Solana's unique features, competitive advantages over other virtual currencies, and market size, and looks at its promising future and outlook...

mifsee.com

Tezos (Tezos, XTZ)

Tezos is an open source blockchain platform supporting smart contracts and distributed applications (dApps). founded in 2014 by Arthur Breitman and Kathleen Founded by Arthur Breitman and Kathleen Breitman in 2014, the platform had a major fundraising in 2017 raising approximately $232 million; the mainnet went live in 2018, with, among other things, self-amendment capabilities (self-amendment) and on-chain governance that allow for no hard fork and Network upgrades are possible.

Tezos is widely used in the following applications

• Smart Contracts and dApps:.Tezos provides a platform for developers to create and run smart contracts and distributed applications, using a proprietary programming language called Michelson to make smart contracts more secure.
• Governance: TheTezos' on-chain governance model allows proposals for network changes and upgrades to be voted on. This allows for continuous improvement with community consensus.
• Staking: Staking Tezos employs a consensus mechanism called Liquid Proof of Stake (LPoS), which allows users to contribute to the security of the network and earn rewards by staking XTZ.

It has the following features

• Self-Amendment function: The user can adjust the number of the Network upgrades can be made without hard forking, which provides stability and sustainability.
• On-Chain Governance:.All network changes are voted on by the community, ensuring transparency and participatory governance.
• Energy efficiencyConsensus mechanism based on Proof of Stake, low energy consumption and environmentally friendly.
• Formal Validation:.Smart contract code is mathematically verified to improve security and reliability.

Tezos is widely supported as an evolving blockchain platform due to its flexible upgrade capabilities and strong governance model.

Real-time stock price chart for Tezos (XTZ)/USD

Sui, SUI

SUI is a native token used on the Sui network, a Layer 1 blockchain developed by the former team of Meta's (formerly Facebook's) Diem project to provide extremely fast and scalable transaction processing. The mainnet went live in 2022. and has built up a large DeFi ecosystem in a short period of time.

SUI is widely used in the following applications

• Staking: Staking SUI tokens are used for staking to secure the network and earn staking rewards.
• Governance: TheSUI token holders can participate in the governance of the network by voting on protocol updates and proposed improvements.
• Transaction fees paid:.SUI tokens are used to pay transaction fees on the network.

It has the following features

• High-speed transactionsSui offers high transaction throughput and can process thousands of transactions per second.
• Low cost Very low transaction fees and low cost of using the DeFi application.
• InteroperabilityIt is interoperable with other blockchains and supports cross-chain transactions.
• Developer Friendly Sui's ecosystem is designed to make it easy for developers to build dApps and uses the Move programming language.

SUI is rapidly gaining traction within the DeFi ecosystem due to its high scalability and low transaction fees. This makes it an attractive platform for developers and users.

Real-time stock price chart for SUI/USD

These issues are important projects that support the DeFi ecosystem, each with its own unique features and strengths.

Where can I buy virtual currency related to DeFi?

There are many virtual currencies (altcoins) related to DeFi that can be purchased on domestic exchanges.
Others must be purchased on foreign exchanges.

Below are the DeFi related virtual currencies that can be purchased in Japan.

DeFi-related virtual currencies available in Japan

Other altcoins must be purchased on foreign exchanges.
I don't use many exchanges myself, but I basically use ByBit.

summary

Focusing on DeFi (decentralized finance), we delved into the details of how DeFi works, its features, its potential, and related virtual currency stocks.

Many DeFi-related virtual currencies are relatively well-known and reliable, making it easy for beginners to trade with confidence. Many DeFi-related stocks are also handled on major Japanese exchanges, making them suitable for first-time virtual currency investors.

One brand of personal note is Sui (SUI).
Sui is a Layer 1 blockchain with fast and scalable transactions; Sui is used in many DeFi projects, including decentralized exchanges (DEX), staking services, and lending and borrowing protocols.

I myself have been keeping an eye on Sui and have been steadily purchasing SUI tokens through staking and watching its growth.
The Sui ecosystem is expanding rapidly and we are very excited about its future development.

I believe that DeFi will continue to see more and more new investment opportunities as a field that has the potential to significantly change the future of finance.