The total value of locked capital in decentralized funding protocols increased by 271% more than $ 7 billion for the first time in less than two months DeFi Pulse.
If the current rate of growth continues, DeFi will be valued at more than $ 27 billion by the end of 2020.
Aave is currently the largest DeFi projectlocked with $ 1.51 billion, followed by MakerDAO with $ 1.42 billion Curve financing at $ 1.15 billion Yarn financing with $ 845 million synthetic with $ 851 million and connection that’s equivalent to $ 797 million.
Aave recently became DeFi’s flagship project after being licensed to operate an e-money institution by the UK Financial Conduct Authority.indicating the growing legitimacy of the sector.
While DeFi’s aggressive growth has been fueled by the recent surge in lending protocols disrupting Maker’s long dominance in space, Only six protocols account for more than 90% of the capital blocked in this sectoraccording to DeFi Pulse.
While numerous projects in the DeFi bubble 2020 quickly caught the imagination of the crypto community, only a few were able to establish themselves as long-term market leaders in the industry.
The recent dramatic rise and fall of Yam Finance offers a cautionary story that highlights the potential severity of contract risk. with more than $ 750,000 in cryptocurrencies lost along with the collapse of the protocol. DForce also suffered a multi-million dollar hack in April;; However, the stolen funds were returned by the hacker and returned to the investors.
Industry leaders warn of the exuberance of the DeFi sector and compound founders Robert Leshner, recently posted a tweet:
If https://t.co/9Kn1cUvYq8 has $ 500 million less than 36 hours from launch, the industry will have to self-regulate and stop launching these meme farming games. https://t.co/IyJSw9zS43
– 🤖 Leshner (@rleshner) August 18, 2020
Earlier this month, the co-creator of Ethereum, Vitalik Buterin, also wrote:: “You don’t have to attend ‘latest in defi’ to be on Ethereum. In fact, unless you * really * understand what’s going on, it’s probably best to sit or sit only participate with very small amounts“.