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Is DeFi Really a Bubble? History will Decide

Many have said it's just a hype and like the 2017 ICO bubble, it will burst. But is DeFi really a bubble? Have a look at the data from Dune Analytics<br>

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Is DeFi Really a Bubble? History will Decide

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  1. Is DeFi Really a Bubble? History will Decide Many have said it's just a hype and like the 2017 ICO bubble, it will burst. But is DeFi really a bubble? Have a look at the data from Dune Analytics Nothing short of a “meteoric rise” is the fitting term to describe the growth of the DeFi sector in 2020. An innovation otherwise called open finance has allowed its users to experiment as well as earn. The gains recorded just within the first half of the year has attracted the institutional eyes and criticisms. Many have said it’s just a hype and like the 2017 ICO bubble, it will burst. But is DeFi really a bubble? This question will elicit different responses depending on your school of thought should you decide to wade into the debate. Famous figures like Bill Gates and Warren Buffet have dismissed Bitcoin and other cryptocurrencies calling it a greater fool’s investment. But beyond the criticisms, we have seen profound advancement in the area of finance with blockchain technology. The figures that matter Data from Dune Analytics shows a total number of DeFi platform users are 275,998. This the total figure when you consider platforms like MakerDAO, Compound, Aave, Synthetix and the rest. Another critical factor is the present capitalization with respect to the overall market cap of the cryptocurrency industry. As at 23rd July, Messari reported a $4.1 billion market cap of the overall DeFi market. Comparing this with cryptocurrency industry overall market cap and you get: Active Ethereum addresses have been growing significantly over the years. And since Ethereum is the number one blockchain fuelling the DeFi growth, it’s safe to assume that part of this uptick in active Ethereum addresses is associated with the DeFi boom. However, a more in-depth look at the chart below from Glassnode shows the metric in consideration is still yet to match the ATH of Jan17, 2018. For those who may not know, this was the glory days of Ethereum during the ICO bubble that climaxed in January of

  2. 2018. The active number of Ethereum addresses reached 700,017 then. And of course, ETH was priced as much as $1,271 per unit. Read More:​​https://cryptodose.co/is-defi-really-a-bubble-history-will-decide/

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