Which divisions have good investment opportunities?



The DeFi industry is not growing properly after it became so widespread in the summer of 2020 to the first quarter of 2021. Now that investors are trying to assess the downward or downward trend of the current market trend, this is a good opportunity to study the defense situation and to find protocols that may work well in the future.

In this article, based on a report from the Kevin Telegraph website, we will look at the most important parts and protocols of the defense industry and review the strategies of users of these protocols.

Stable coins are the basis of Defy

Stable coin differences protocols are the cornerstone of this ecosystem, and when it comes to stockpiling, curves are still the main protocol.

Top 5 protocols regarding the total value of the concluded capital
Top 5 protocols regarding the total value of the concluded capital.

Data from Defi Llama’s analysis website show that four of the top five locked-in capital (TVL) protocols are dedicated to creating and managing stable coins.

It should be noted, however, that although these protocols are at the top of the table in terms of the total value of concluded capital, the value of most of their own tokens is far from their peak in 2021.

The bottom line is that when investors invest in the defense industry through Yield Farming and equity in stable coins, they also get a stable return. In addition, these investors receive government tokens from these platforms and can use them to offset the loss of value of their other tokens.

Stable coins continue to play an important role in the overall performance of the defense industry. It is worth noting that with the increase in the total value of capital locked in new protocols such as Frax Share and Neutrino, as well as the growing number of interconnected Chinese blockchain networks, the defense industry can continue to grow.

Read also: The most complete defense training; From garlic to onion decentralized platforms

Lending is at the heart of Defay’s business

Lending platforms are another key component, as well as one of the most important parts of the Defy ecosystem that investors can use even in declining markets. The AAVE and Compound protocols are the current leaders in lending, with a total fixed capital ratio of $ 12.09 billion and $ 6.65 billion, respectively.

Like other Stable Queen protocols, the value of Avi and Compound’s own tokens peaked in 2021, and to date, the price trend for both is declining.

AVI / Tetr and Compound / Tetr performance comparison chart in everyday view
Compare the price of AVI (blue chart) and compound (orange chart) in one day view.

The increase in the value of Avi’s total locked-in capital and its price lead over Compound is mainly due to the chain’s cooperation with the Paligan and Olench networks. With the formation of this interconnection, the number of assets supported in this protocol has increased and AVI users no longer have to pay high fees for the Atrium network.

Long-term investors in risk-prone digital currencies can easily lend their tokens and make modest profits.

Comparison of stable interest rates for coins in AVI and combined protocols
Comparison of interest rates on stable loans of Dai and Usain Quinns in AVI and Compound protocols; The union pays more interest to provide liquidity.

Sharing increases against applications

With the growing popularity and application of digital currency sharing protocols, more and more traders are using the defa industry. The Lido Finance protocol, for example, was originally created as a Chinese blockchain solution for networking Atrium, but now also supports Luna, Solana, Kusama and Paligan tokens.

Defai Lama data show that with the increase in the number of new digital currencies maintained in the Lido Protocol, the value of the total locked capital in this protocol has also increased and reached its historic peak of $ 14.96 billion on March 10 (March 19). ).

The value of the total locked capital in the Lido protocol
Graph of the total value of the capital concluded in the Lido protocol.

In the Lido protocol, users can share Atrium and Solana and receive “stETH” and “stSOL” tokens in return. These tokens can be used as collateral in the AVI protocol for borrowing stable coins. In addition, merchants can use or trade these tokens in the profit process. This increases their total return on principal.

Other notable protocols active in the field of shareholding include StakeWise, which also allows its users to share in Atrium 2.0. Stader Labs and pStake are among the relatively successful protocols in this area.

Which divisions have good investment opportunities? appeared first for currency.

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