The Future of DeFi Depends on Ethereum, But for How Long?

As decentralized finance gains steam how much of it will depend on Ethereum? Well, it depends on how long Ethereum 2.0 takes to launch.

DeFi’s Dominance 

The number two blockchain hosts the largest number of developers, and thus reports the most activity, according to data from August 2019. Of this activity, “smart contracts, infrastructure, and DeFi ecosystems continue to gain full-time developers.”

Indeed, some of the sharpest minds in blockchain technology are moving to Ethereum to build out the alternative world of finance. This is made clear by the fact that nearly all the dominant DeFi applications are built using Ethereum-based smart contracts. 

DeFi Pulse, a site that reports data on the family of DeFi applications, reveals that nine of the top ten DeFi products are built on Ethereum. Bitcoin’s Lightning Network, a layer 2 solution to allow for speedy micro-payments, is the only non-Ethereum application included. It isn’t just the top ten that are thriving either. 

At press time, DeFi Pulse indicated that a total of $701.7 million is currently locked up across DeFi applications. That is more than double the amount since January 2019, with some commentators calling 2019 “the year of DeFi.”

It has its ups and downs but there's an undeniable curve forming and it keeps getting steeper… #DeFi