Even as the crypto markets experience prolonged turbulence, the decentralized finance (DeFi) space appears to be alive and growing.
In a new Glassnode insights report, the on-chain market intelligence firm says that despite an emerging trend in the sector, DeFi developers are still building and they’re building quickly.
“Despite bearish on-chain activity, more innovation than ever is coming to DeFi as 3-12 month dev cycles come to fruition. Each week more and more projects are launched, major updates are pushed, and important ecosystem-changing events draw closer.”
The report calls out new developments in seven crypto protocols as a sign of rapid innovation in the industry. Glassnode points to successful product launches by decentralized yield farming insurance project Cozy Finance, volatility index platform Volmex Finance and sustainable yield project Ribbon Finance as evidence that the sector is flourishing.
Researchers also highlight product launches from the future yield platform Pendle, lending protocol Rari Capital, and reserve currency protocol OlympusDAO.
In addition, Glassnode points to internal efforts by the team at Alchemix to recover from a recent exploit as another sign of the DeFi ecosystem’s ability to be self-sufficient and free of intermediaries.
Although developers in the space continue to innovate, DeFi has seen significantly less activity amid the crypto market crash.
“Growth in new and existing activity throughout DeFi has taken a hit, as many participants move into a risk-off mindset amidst -60%+ dips from ATH across most governance tokens. While on-chain activity is no longer increasing as a % total month-over-month, year-over-year growth remains massive.”
Glassnode notes that, despite the crash, total liquidity locked up in DeFi has remained strong, assuaging some fears that during a significant bear market liquidity might dry up in the space.
The firm also notes that “long-term ETH holders appear strong-willed” despite Ethereum’s drawdown from above $4,000 to below $2,000.Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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