In the cryptocurrency world things are starting to feel eerily similar to 2017 again, but this time there’s a new kid on the block – Decentralized Finance (DeFi).
DeFi is seemingly leading the charge of the reborn cryptocurrency hype and hysteria, and it doesn’t take a genius to see why. The capabilities of DeFi, at least on paper, are astounding. Using DeFi, anyone has the opportunity to essentially become their own bank and start using financial services like lending, borrowing, trading and more with no middlemen, reasonable fees or even no identity verification. It gives people freedom to interact with financial services, but more importantly DeFi opens up the opportunity for the unbanked to access financial services, something that previously wasn’t possible.
Those that have really got the knack of DeFi are utilizing numerous services and promotions at once to achieve the highest interest rates possible. It’s not unheard of to break 100% APR – a previously unthinkable interest rate. This process is referred to as yield farming.
Numbers don’t lie. The amount of value locked in DeFi has increased by more than 400% since the beginning of 2020. With the rate at which it’s increasing it seems like if you blink you’ll miss a multi-million dollar increase.
But here comes reality. DeFi is admittedly great as a concept or an idea, but it’s impossible to deny that as a whole DeFi is incredibly nacest and as a result is actually pretty rudimentary and annoying to use. There are loads of useful DeFi protocols, but they all exist separately. It’s challenging, or at the very least annoying, to jump from one to another as nothing is properly interconnected. Liquidity is largely siloed, which diminishes the useability of some products too.
The concept is there, but DeFi most likely needs some further innovation to really move to the next level and provide real value, outside of satisfying the need crypto speculators have to front-run the next big thing.
Tooled with a challenging problem that urgently needs addressing, the DeFiPie team are creating a new product aiming to transform the DeFi landscape to make it better and more accessible for all.
DeFiPie is a decentralized finance project that’s aiming to create a DeFi super app that will facilitate connection between previously disjointed DeFi protocols, allowing information and data to flow and ultimately vastly increasing the usability of DeFi.
With DeFiPie users can access numerous DeFi services all in one easy to use interface. The PIE token is the native asset and is used to reward users and also incentivize holding. Let’s take a look at the PIE token and then the services that are available in the DeFiPie ecosystem.
The PIE token is designed to drive early adoption of DeFi pie with finite rewards and token holder benefits. Advanced features are exclusive to those that use PIE tokens and holders will receive better rates throughout the ecosystem.
PIE will be required for the following activities:
- Starting and participating in custom lending and liquidity pools Participating in P2P lending.
- PIE is needed to manually create and accept loan offers.
- Starting a staking pool.
The biggest DeFi lending protocols are automated, which means users don’t have control over their loan offers. With DeFiPie lenders and borrowers can choose between fully automated, semi-automated and manual services to fit their needs.
If a user selects fully automated DeFiPie will automatically secure loans at an algorithmically determined interest rate. It’s nice and easy to use, but probably won’t give you the best interest rate possible. Automated lending also restricts the available collateral. On the other hand, manual mode gives the lender complete control, allowing them to choose the desired interest rate, loan length, loan-to-collateral-value ratio and much more.
Using DeFiPie, PIE token holders with a large enough holding can create a staking pool where other users can combine their coins to stake, increasing their reward and network influence together. DeFiPie says this service will offer some of the lowest fees for staking services on the market and that the service is non-custodial, so stakers have complete control over their funds. Furthermore, if you choose to receive staking rewards in PIE tokens you’ll earn bigger rewards.
Investors can deposit their cryptocurrency into a liquidity pool and earn rewards based on the amount of capital they have provided. The liquidity will be used throughout the ecosystem, for things such as loans, swaps, staking and preventing illiquidity events. When a user places assets into a DeFiPie liquidity pool they receive a corresponding amount of P-tokens, which symbolizes the value they have stored in the pool.
Custom lending pools
If you hold enough PIE tokens you will be able to create your own decentralized lending pool where members have control over the mechanics of the pool. Traditionally in DeFi these things are controlled by algorithms that study supply and demand, but DeFiPie is putting the power into the users hands to give them freedom to choose.
Pool members can control lending rates, the accepted collateral, the PIE holding required to have admin rights, PIE token utility rates and much more.
Active users in the DeFiPie ecosystem are incentivized by receiving a small amount of PIE each day they are active. Actions within the ecosystem are also rewarded with PIE. This model is said to be designed to create a balanced supply and demand dynamic for DeFiPie, which aims to attract a strong user base on both sides of the lending operation.
DeFiPie is aiming to become a DeFi super app that contains all the popular DeFi services in one ecosystem that are all interconnected. By joining these together it will be easier for users to interact with the services and it will also improve the service level each one provides. PIE is the native token and provides holders numerous benefits within the ecosystem.
*This article has been sponsored. The Daily Chain encourages you to carry out your own research before you make any form of investment and educate yourself about how to stay safe in the crypto space.