Reasons, why DeFi is outperforming Bitcoin


DeFi sector, which is evolving from a sector of cryptocurrencies, is being compared to its ancestors quite often. This, of course makes sense, since for huge number of DeFi supporters, cryptocurrencies are the stepping stone of the financial revolution, which should be lead by the DeFi projects. Therefore, it is very common to see comparisons of recent successes of DeFi projects with cryptocurrencies such as Bitcoin. This article will have a look at some of the main reasons, why DeFi tokens are at this moment in time doing incredibly well as compared to the biggest cryptocurrency.

Expecting Ethereum 2.0

One of the main reasons why DeFi projects are rising so much right now might be the expectation of the switch of Ethereum to a new Ethereum 2.0 protocol. This change is expected to have significant impact on the DeFi sector and is considered to be very bullish news as majority of the DeFi activity occurs on the blockchain of second biggest cryptocurrency. According to Jon Jordan, communications director at DappRadar, Defi sector could be heavily changed with the arrival of ETH 2.0.

“Two of the main obstacles to making dapps on Ethereum easier to understand and use are gas fees and slow block times. Ethereum 2.0 will fundamentally solve these, making Ethereum dapps feel much more like using the standard web and mobile apps we are all used to.”

Whether this is the reason on why the investors are so bullish right now about DeFi or not, the fact is that Ethereum 2.0 should have significant impact on the sector. Only time will show, if the impact is positive or negative, but as Jon Jordan said, the DeFi is likely to benefit greatly from the coming update of Ethereum.

It is all about the network

The rise of the DeFi network and its users can be regarded to almost as exponential. Gas usage is at its all time high, so is the number of newly created projects or interaction with Ethereum network through simple transactions or smart contracts. These are just few stats from the sector that point to one direction that the whole DeFi sector is currently heading to — UP. This can be also visible on the graph below, which shows total value of locked USD in the DeFi sector, which saw sharp increase in recent weeks.

Source: DeFi Pulse

All of these facts combined could be seen as a mix of reasons why the DeFi projects and tokens are outperforming Bitcoin quite vastly. As pointed out by Delphi Digital, 90 day performance of projects such as Aave, Loopring or Kyber Network heavily exceed performance of Bitcoin, which was able to increase by almost 80% in value (still significant rise) in the last three months. However, Aave was able to more than triple its value (360%), Loopring by 237% and Kyber Network increased by 165% in the same period of time.

DeFi on rise

Numbers do not lie and in this sense, almost anything that is even remotely connected to DeFi sector is on its ATH. That is one of the main reasons why you should join this sector as well no matter what your experience with cryptocurrencies or decentralized finance is. If you do not know where to start, try looking at DEPCO project. It offers possibilities and options for anyone and everyone who would like to get educated and directly involved in the DeFi sector.

Moreover, through the Keeper system and Explorer system, DEPCO offers possibilities on how to directly financially benefit from the imperfections in ever-growing DeFi sector even if you do not have any knowledge and experience in DeFi sector or cryptocurrency industry. Therefore, DEPCO is a place to go when you want to get direct experience in this market.


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