Waves’ founder and CEO is concerned that the recent Glowing DeFi projects are similar to the ICO balloon seen in 2017 and 2018.
Sasha Ivanov, founder and CEO of Waves, warned of a possible “ICO balloon” in the area of decentralized finance (DeFi).
Ivanov compared the current interest in DeFi projects to the sudden flow of capital to ICO projects seen in 2017. As is known, ICOs eventually had a devastating effect and many investors around the world lost big sums of money.
Waves CEO told Cointelegraph that he was deeply concerned about the growing enthusiasm while believing in DeFi, and this could damage DeFi’s long-term development.
“DeFi products have a more complex structure than simple ICO tokens, possibly limiting unqualified investors to invest in these products. However, the inevitable price volatility and crashes in the future can seriously damage the mass adoption of DeFi. ” spoke in the form.
The growth of the DeFi industry, which has continued step by step since 2018, is progressing with a stronger momentum in 2020.
DeFi can be defined as the ecosystem of financial applications running on Blockchain. DeFi, which provides advantages to the financial world such as the elimination of intermediaries and central system risks, as well as the great reduction of costs, is the most popular use area on borrowing and lending.
Borrowing and lending in DeFi has advantages such as instant credit opportunity, instant transaction termination, easy borrowing, easy lending, minimizing the need for trust, lack of credit control and virtually zero transaction costs compared to the traditional banking system. .
Many DeFi tokens, especially Compound (COMP) and Aaeve (LEND), have come to the fore in recent days.