Despite the meteoric rise in decentralized finance (DeFi), retail investors have shown little interest in this area since the ICO boom 3 years ago.
This is the conclusion reached by Coindesk experts after analyzing the statistics of Google Trends. If you look at the graph of the number of requests for the keywords “ICO” and “DeFi”, you can see that investors are not showing an increased interest in DeFi, as was the case in the “golden days” of ICOs in late 2017 – early 2018.
However, many members of the cryptocurrency community compare the development of DeFi with the bursting of the ICO bubble, after which millions of investors were left with tokens that have lost most of their economic value.
According to DeFi Pulse, at the end of August, the total value of assets blocked in DeFi protocols exceeded $ 7 billion, and in September this figure exceeded $ 9 billion.Coindesk experts claim that this value exceeds the amount collected on ICOs in 2017 (about $ 5.4 billion) , by 66%. In addition, the current DeFi figure is double the volume of assets collected during the ICO in the first quarter of 2018, before the onset of the “crypto winter”, when the value of cryptocurrencies began to plummet.
If we talk about trading volumes, large decentralized exchanges are already seriously competing with centralized platforms. For example, on August 30, the daily trading volume on the Uniswap decentralized exchange exceeded $ 500 million, while on the Coinbase Pro exchange on the same day this figure was $ 394.9 million. It is worth mentioning the Aave LEND token, whose rate has grown 40 times.
Despite this apparent growth in DeFi turnover, retail investor interest in the industry remains relatively low. Coindesk researchers explain this by the fact that decentralized finance is attractive to more experienced and selective investors, while even beginners took part in the ICO.
“The DeFi industry is growing at a growing pace, but unlike ICOs, it has a steady trend,” said Su Zhu, co-founder and CEO of Singapore-based hedge fund Three Arrows Capital.
However, Ethereum co-founder Vitalik Buterin recently compared the decentralized finance industry to the “printing press” of the US Federal Reserve System (FRS), urging not to succumb to the hype around DeFi.