‘No, DeFi Is Not Dead,’ Says Ex-Founder Of Yield Finance

Dalmas Ngetich

2 years ago

3 mins read

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Andre Cronje, the co-founder of Fantom Foundation and the ex-creator of Yield Finance, a DeFi protocol, disagrees with people who say DeFi is dead and the period of high yields is gone.

DeFi Is Not Dead

In a Medium post on February 1, Andre agrees that the crypto bear market of the past year impacted activity and forced users to preserve assets, swinging to stablecoins. Even with this, at spot rates, he argues, on-chain metrics and yield readings from various DeFi protocols, including in Yield Finance, point to a possibly undervalued DeFi market.

He compares the current yields of various coins and stablecoins, including USDT, USDC, and DAI, an algorithmic stablecoin issued by MakerDAO, with those of early 2020 as offered by Yield Finance.

Daily APR https://t.co/BAcrlUTqrQ $DAI 8.75% dominated by @bzxHQ. Static since they introduced 9% fixed rate, they own it.@USDC ~4% @compoundfinance and @dydxprotocol fighting over dominance.$USDT comfy at 20.75% at @AaveAave (insane)@CurveFinance $DAI strong at 9.11% pic.twitter.com/dtadzP8Wx2

— yearn (@yearnfi) February 5, 2020

Then, DeFi was gaining traction, and the total value locked (TVL) had crossed the $1 billion mark. At present, DeFi TVL exceeds $47 billion and, at one point, stood at over $170 billion at the peak of the last rally. By late November 2021, BTC was trading at over $69,000.

Early 2020 marked the early stages of a protracted bull market that lasted two years to the end of 2021.

Bitcoin Price on February 1| Source: BTCUSDT on Binance, TradingView

Presently, the ETH, USDT, DAI, and USDC real yields are relatively higher than in 2020. Andre notes that this is amid an inactive market following the losses of last year. Generally, real yields offered by DeFi protocols are from the lending market and trading fees.

At the moment, Andre assesses that everyone who had shorted had sold their coins but appear not confident to exit, which is why he is confident the current yields are “really low” despite being relatively higher than in early 2020.

Considering this development, he disagrees with people who think DeFi is dead and periods of high yields are long gone. He argues that this assertion is based on comparing the “current market with an unsustainable and highly delusional market peak, and not its progression.”

He explained:

If you plot a growth chart on TVL, yield, and trade volume, and you flatten the curve to avoid oscillating, it is a clear linear growth chart.

Andre maintains that DeFi works as designed and doesn’t need a new narrative or a “shiny toy”.

Taking Charge

DeFi provides an alternative to users who would otherwise not participate in traditional finance. The ecosystem comprises decentralized exchanges, insurance protocols, investment platforms, and more.

Because they depend on smart contracts, DeFi protocols devolve control to the end user, unlike centralized platforms like BlockFi or FTX, whose collapse saw clients lose billions in crypto assets that were under the custody of the exchange.

Feature image from Canva, Chart from TradingView

Dalmas Ngetich

Dalmas, a seasoned crypto reporter, brings a unique perspective to the industry. His specialization in NFTs, blockchain, DeFi, and blockchain news for NewsBTC, combined with a background in mechanical engineering and over a decade of experience in journalism, has allowed him to craft over 10,000 news and feature articles over the past eight years. His diverse range of topics, including technology, Forex, and finance, reflects his comprehensive understanding of the crypto landscape.

His technical expertise and analytical skills have been recognized and featured by leading news outlets such as Investing.com, CoinTelegraph, Entrepreneur, Forbes, and other authority sites. Notably, he broke key news, including the Ripple and MoneyGram partnership, cementing his position as a thought leader in crypto.
The news exploded. Over 100,000 people devoured this meticulously crafted report, from seasoned investors to curious newcomers. His analysis wasn't just dry facts and figures; it crackled with insight, dissecting the implications of the partnership and its potential impact on the future of finance.

His deep understanding of the financial markets, technological advancements, and blockchain developments has made him a respected voice in the industry.

Dalmas is also the founder of BTC-Pulse, a crypto news site, further demonstrating his commitment to the field. He firmly believes that DeFi and NFTs are here to stay and will continue to drive financial inclusion.

Coming from Nairobi, Kenya, it is easy to see the source of his inspiration: Across Africa, millions lack access to traditional banks. Remote villages, limited documentation, and high minimum balances create insurmountable barriers.

DeFi, not just Maker or Aave, for example, but think of Bitcoin and USDT, cuts out the middleman. Forget banks with their limitations.
Even so, DeFi isn't a magic solution. The continent still struggles with reliable internet access, and educational campaigns highlighting the benefits of this wonderful solution are insufficient. Moreover, even for those interested, understanding DeFi can look like learning a new language.

Dalmas is here to help make the tech easy to understand and digestible, even for beginners.
The story of DeFi in Africa is still being written. Challenges abound, but the promise of a more inclusive financial future is a powerful motivator. With innovation and collaboration, Dalmas firmly believes that DeFi could become the key to unlocking Africa's full economic potential.
This possibility and its immense value motivate Dalmas to continue breaking key DeFi innovations and more across the globe. His engineering background further enhances his ability to deliver well-thought-out pieces that blend technical insight with clear, impactful reporting.

Beyond his professional achievements, Dalmas is deeply passionate about technology and politics. Policies drive adoption, and being at the forefront and keeping up with how they evolve is crucial for the sphere to mature.

When Dalmas is not closely monitoring the latest crypto events, he can be found in nature, exploring the picturesque countryside, and traveling with his family and friends. His love for adventure and discovery perfectly complements his investigative and reporting skills.
You can connect with Dalmas on X: @Dalmas_Ngetich, or contact him on Telegram @Dalmas_Ngetich.

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