Ethereum Defi: The New Price Fuel?

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Summary

They don’t go back to fiat because fiat interest rates are 0%. All these fluctuations create some barrier to entry, but the ICO tokens were also bought by bots mainly. It’s not clear however why all this should necessarily reflect on the price of ethereum itself. However, if we look at this more holistically, defi like icos can lead to both an increase in demand and a practical contraction in supply. Defi is different because you’re not giving eth for these tokens.

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As tokens once more rise seemingly out of nothing to gain a billion dollars market cap in days, the potential resemblance to the ICO boom hasn’t escaped many.

Not least because these are in some ways public offerings of ownership of public code, but this time it is code that has actually been built and it has users.

That limits the number of potential participants as you need a product first to then sell the rights to participate over how to run the code business.

That acts as a sort of quality scanner, but there are still plenty of low hanging fruits in the decentralized finance space to build new products as well as to develop on the synergy of dapps that have already been built.

It’s not clear however why all this should necessarily reflect on the price of ethereum itself. Positively that is, or even negatively.

ETH And DEFI, The New ICOs?

The 2017 boom has been attributed to Initial Coin Offerings (ICOs) by many, with the argument...

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