The growing popularity of Decentralized finance or DeFi This could backfire in the future and harm the industry, said Sasha Ivanov, founder and CEO of the crypto platform waves, in a recent interview with Cointelegraph.
Ivanov compared the DeFi with the fashion of the ICO (Initial Coin Offering) in a Tweetand said, “Please don’t make a new ICO bubble with #DeFI.”
When asked about her testimony by Waves CEO, he found that she firmly believes in DeFi, however worried about the hype about them::
“DeFi is the future, but now there will be a bubble in the cycle that could hinder its long-term development.”
In Ivanov’s opinion, the DeFi network tokens are “clearly useful and have a mechanism that gives them value”. However, he noted: “The price can sometimes be inappropriate, which will lead to bladder situations. “
Although DeFi appears less attractive than ICOs to inexperienced investors due to its complex structure, You are likely to experience volatility and sudden price dropsIvanov continued:
“DeFi products are inherently more sophisticated than simple ICO tokens, which will likely limit the influx of unskilled investors. However, volatility and inevitable future price declines can seriously undermine DeFi’s prospect of mass launch, which would be very negative.”
The popularity of DeFi has increased recently. As reported by Cointelegraph, more than 1,000 new DeFi assets were added in May. almost ten times more than in the same period last year.
The total number of DeFi users is now approaching the 600,000 mark.
As a result, many DeFi-based tokens increased in 2020, with some growing over 60% in the past week.