Coinbase recently announced that they are currently reviewing a new batch of digital assets. Among them are several DeFi tokens including Bancor, Compound, and Synthetix. It appears that all of these platforms are built on Ethereum. Whether that is a coincidence or not, Ethereum 2.0 will play a crucial role in the future development of most DeFi systems.
The digital asset exchange is one of the most regulatory compliant crypto platforms in the space. As such, each project requires serious compliance review and may be subject to government approval in some jurisdictions.
Coinbase also heavily screen projects based on their objective, tech, team, security, governance scheme, scalability, as well as other criteria.
Among the the digital assets under review, five are DeFi projects. These tokens may likely be listed soon, but it’s not a guarantee as of yet.
DeFi Projects To Be Listed
Bancor is a DeFi protocol built on Ethereum. It functions as a decentralized exchange for digital assets, which means it doesn’t require order books nor does it have any middlemen involved.
Compound is an Ethereum-based algorithmic money market platform that enables users to lend or borrow assets against a collateral.
Synthetix is a crypto-backed decentralized synthetic asset issuance protocol that is also built on Ethereum. This platform enables the creation of what is called synthetic assets or “Synths”, which track the value of real-world assets.
Ren is an open-source system that provides access to inter-blockchain liquidity for all decentralized applications.
Aave is an Ethereum-based non-custodial system built for decentralized lending and borrowing.
DeFi Assets at an Exponential Upsurge
Since 2019, the DeFi landscape was already growing steadily. But it wasn’t until last May that the space has seen unprecedented growth.
More than a thousand new assets have been added in DeFi platforms as the total number of users has reached 550,000. This means that DeFi assets have grown nearly tenfold in a year’s time.
Similar to what [the] Internet did to content, DeFi is doing to finance,
Evgeny Yurtaev
Decentralized Finance holds a very important place in the Ethereum ecosystem. In fact, it accounts for 60% of the total value of Dapps in May, nearly three times more than exchanges.
Moreover, DeFi is partly responsible why Ether’s price performance trumps Bitcoin’s this year, according to Peter Chan, a trader for OneBit Quant, a Hong Kong-based crypto trading firm.
This explains why we see bigger pumps on Ether than Bitcoin when the market moves upwards. Ethereum is evolving much faster than Bitcoin with the rapid growth in DeFi.
Peter Chan
On the flipside, DeFi also relies heavily on Ethereum, especially, in its planned upgrade. Ethereum, as it is now, is limited to 50 TPS at best (15 TPS on average).
This scalability issue may become or might already be a bottleneck for DeFi systems. For this reason, the success of DeFi is intertwined with the success of Ethereum 2.0, which will bring implementation improvements like sharding that would allow Ethereum to run at the same capacity as Visa.