DeFi Ecological Evolution: Ethereum Original, Tron, EOS Copycat Imitation?
DeFi (decentralized finance) has developed to the present, and there are extremely obvious differences in attitudes towards it inside and outside the circle: some people think that the current DeFi is obviously overheated, and it is not far from a collapse, while others have completely different views. Instead, think the wave is just getting started.
In my opinion, there are indeed some coins in DeFi now, both in terms of increase and price, which are already quite astonishing. We need to be highly vigilant in this situation.
Someone has done a quantitative analysis of the current market and concluded that although DeFi is very hot, the number of retail investors who actually participate is still far less than in 2017. This article was translated by Babbitt, and the title is "A large number of retail investors entering the market? Data show that the current number of market participants is far less than in 2017".
Today I will share with you the main points of this article.
The article analyzes transaction volume, Google search index and other aspects.
First of all, from the perspective of transaction volume, "the current transaction volume of Bitcoin on centralized exchanges has dropped by more than three times compared to the peak period in 2017", and "the same is true for Ethereum".
At present, centralized exchanges are still the main place to directly purchase bitcoins. Although users can buy various packaged coins of bitcoins on decentralized exchanges, if users want to withdraw real bitcoins to their wallets, it is still ultimately It needs to be traded on a centralized exchange.
Therefore, to measure the extensive participation of users from the volume of Bitcoin transactions, I think this scale is still very credible.
Bitcoin is undoubtedly the most recognized among all digital currencies, and every bull market of digital currencies as a whole must be inseparable from the rise in the price of Bitcoin and extensive participation in trading. Therefore, the lack of participation in Bitcoin can at least show that there are still not many people trading on the market.
From the Google search index, "Google's search volume for 'Bitcoin' peaked in the week of December 17, 2017. In 2020, the average search volume of people is nearly 7 times less than the peak week in December 2017. The most recent The search volume didn’t even surpass the slightly elevated index caused by the halving.”
The low search index for Bitcoin shows that the majority of users do not pay enough attention to Bitcoin. In my opinion, this may mean that for most non-expert players and new users, they seem to be unaware of the recent hot DeFi in the market, so in their impression, the first object of attention is still Bitcoin, The recent flat trend of Bitcoin will naturally not arouse their attention and interest.
If we regard Compound’s launch of COMP tokens on June 17 as the starting point of this round of DeFi tide, as of now, in less than three months, although DeFi has developed extremely hot in the eyes of followers, Wan Double coins appear, hundred times coins emerge, ten times coins can be found everywhere,But this enthusiasm did not radiate to Bitcoin, nor did it radiate to Ethereum, the main battlefield of DeFi.
Although the prices of Bitcoin and Ethereum have increased to a certain extent during this period, this increase is nothing compared to DeFi.
The above data and phenomena show that the popularity of DeFi is limited to small-scale capital flow and user participation. It has not "out of the circle", let alone entered the public.
why? I think that the operating threshold is too high and the gas fee is too expensive. I am afraid that the two major obstacles.
The so-called threshold is too high. It is not only complicated steps to operate various DeFi on Ethereum, but also cumbersome process. For novice users who are not familiar with Ethereum, it is not an easy task to complete a set of procedures.
Although the high threshold is a big obstacle, many users will still try their best to cross this threshold under the attraction of the riches effect, but the gas fee is too high, which affects the actual income, which may be the key to affecting the participation of ordinary users.
If we speculate in this way, I think it is possible that the main DeFi battlefield where ordinary retail investors participate will become a platform with much lower fees such as TRON or EOS.
Because the wealth effect of DeFi has now begun to ferment and attract more and more people’s attention, and the recent fire of several projects in Tron has attracted many new users to participate.
These participating users generally report that Tron does not have the exaggerated handling fees of Ethereum and the experience is smooth. Therefore, it is very likely that TRON’s DeFi feast has just begun. Although many dishes in these feasts are imitations rather than originals, ordinary users will not care so much, and only care about whether they can get benefits from it.
Therefore, the next DeFi ecology may evolve into: Ethereum original, wave field and EOS cottage. Experienced users play Ethereum, while novice users play TRON and EOS.
