The total number of Bitcoins (BTC) locked in decentralized finance (DeFi) protocols reached an all-time high as the DeFi market became popular.
Defi Pulse analytics platform DeFi Pulse revealed that bitcoin owners converted $ 1.5 billion worth of 141,683 BTC into ERC-20 tokens to gain entry into the emerging decentralized finance space.
Due to the mismatch between Bitcoin and Ethereum blockchain, BTC users are required to convert their assets into Ethereum-based tokens to take advantage of the features of the DeFi platform. The most popular choice among bitcoin owners is WBTC, where they can convert their BTC in a 1: 1 ratio. With WBTC, bitcoin owners can benefit from Defi on lending platforms such as Compound (COMP) and aave (LEND).
At the time of writing, there are approximately 95,700 wBTC stored in the Ethereum blockchain.
The increase in the number of BTC locked in defi indicates a growing interest in the decentralized financial sector. Yearn, which retreated 60% from its all-time high of$ 43,873, according to data provided by CoinMarketCap.finance (YFI) has also experienced a 15% increase in the last 24 hours. AAVE me decentralized oracle network Chainlink (LINK) has also increased by 17% and 13%, respectively, in the last 24 hours.
According to some analysts, the DeFi ecosystem is seen as a bubble that will soon explode. But interest in decentralized structure, which is the goal of cryptocurrency, is growing every day. Despite the growing interest of users, countries still oppose the DeFi platform. Since cryptocurrencies on the DeFi platform are often preferred for illegal transactions, countries are not in favor of a legal system that they cannot control.
Why DeFi (Decentralized Finance)?
Cryptocurrencies were launched with the concept of a freer financial power as a reaction to traditional finance. Defi’s sole purpose is not freedom, but, on the other hand, it is created for every user who cannot access the traditional financial system and has difficulty reaching it.
The question of whether there is still a user who cannot access the banking system is questionable by some. But more than 1.7 billion people worldwide are described as “unbanked,” meaning they have no access to the traditional banking system, and yet the traditional system is not making great strides to address the problem. DeFi therefore stands out not only for its decentralization, but also for its desire to reach out to all.