Decentralized finance (DeFi) is a game-changer in the world of blockchain technology. It allows people to access financial services without middlemen. In this article, we’ll explore how DeFi intersects with traditional finance in two key areas:DeFi derivatives and blockchain gaming monetization.
First, let’s look at DeFi derivatives. These are financial products that allow investors to speculate on the price of an underlying asset without actually owning it. The DeFi derivatives market is still small compared to traditional finance, but it’s growing fast. Some of the biggest players in the DeFi derivatives market are Maker, Uniswap, and Wrapped Bitcoin (WBTC). WBTC is an Ethereum-based derivative of Bitcoin that has seen a massive increase in supply. Tranche lending is also gaining popularity in the DeFi world, offering a new way to fund risky loans.
Now, let’s move on to blockchain gaming. The gaming industry is huge, with billions of gamers worldwide spending hundreds of billions of dollars each year. DeFi is exploring ways to monetize this industry by enabling players to earn tokens by completing certain in-game tasks. This requires DeFi protocols to facilitate in-game transferability, and game-based cryptocurrency owners are looking for ways to earn returns on their assets. BitSport has already announced plans to allow crypto owners to sponsor pro gamers and stake tournaments, while Ubisoft’s HashCraft was the first blockchain video game, with more titles expected to follow.
As DeFi continues to evolve and expand, we can expect to see more innovative ways of bridging the gap between traditional finance and blockchain technology.