The decentralized wing of the crypto-verse has taken over the community. Despite the increase in the scammy projects, DeFi has continued lounging under the crypto-spotlight. While several pointed out that the DeFi boom was nothing but a bubble in formation, the space garnered funds in large numbers. Appearing in a recent interview, the Chief Executive Officer of Galaxy Investment Partners LLC, Mike Novogratz elaborated on the fervor around DeFi.
“It’s Kind Of Gamifying Money”
It isn’t news that the latest DeFi boom was compared to the 2017 ICO bubble. Several of the DeFi platforms and DeFi tokens were seen as a means of becoming rich as soon as possible. Novogratz continued to stress the comparison between ICOs and DeFi and suggested that ICOs had previously given a bad reputation to the cryptocurrency industry and that Ponzi-like coins were seen pouring into the market.He added,
“It’s kind of gamifying money. There are still lessons we are going to get out of that, but it’s not great for the ecosystem.”
Yield farming became a huge hit amongst investors looking to acquire increased returns. At present, the entire DeFi market has more than $10 billion locked in it. While several have started noticing a surge in fraudulent projects, a few others continue to invest in them. However, Novogratz believes that DeFi could give banks a run for their money and he suggested that DeFi “is not a fraud, not something that’s going to come and go.” Most of the DeFi platforms offer lending and borrowing services. With transparency and decentralization as its main motive, DeFi has evidently lured in an increased number of people.
During the time of writing, a total of $10.95 billion was locked in the DeFi space. Prominent decentralized exchange, Uniswap had recently surpassed $2 billion and was touted as the first DeFi platform to do so. Maker was seen right behind Uniswap at $1.92 billion. The former looked like it was soon joining Uniswap in the $2 billion club. As the zeal around these projects continue, Novogratz added,
“It was a frenzy, people got a little bit silly,”
Additionally, Novogratz revealed that 5% of his capital was invested in DeFi through ParaFi Capital, where Galaxy is a minority shareholder.