updraftplus domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131hustle domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131wpforms-lite domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131According to the report, the numbers prove that Decentralized Finance is the new high-development and growth area for the crypto space. The report also suggested that a dip in Centralized funding projects was seen because of a possible saturation in the sector.
Virtual asset investment companies have invested more than $2.7 Billion into decentralized finance undertakings in 2022. The investments have increased by 190% since 2021, while investments into centralized finance projects have gone down, dropping by a staggering 73% to $4.3 Billion in a similar timeframe. The exponential rise in DeFi funding can be witnessed even though crypto funding numbers have plunged to $18.25 Billion in 2022 from $31.92 Billion in 2021 with the market charts dropping to a full-blown bear run.
According to the report, the numbers prove that Decentralized Finance is the new high-development and growth area for the crypto space. The report also suggested that a dip in Centralized funding projects was seen because of a possible saturation in the sector.
The almost three-fold hike in DeFi investment is also a massive 65-fold increase from 2020, which was when the crypto market bull run initialized. The largest DeFi contribution to the monumental funding reserve gathered was made by Luna Foundation Guard’s (LFG) $1 Billion sale of Luna tokens in February 2022. This was made three months before the unceremonious fall of Terra Luna Classic (LUNC) and TerraClassicUSD (USTC) in May.
Ethereum-native decentralized exchange (DEX) Uniswap raised $165 Million in a Series B funding round that saw companies like Polychain Capital investing in the firm to grow its business into other domains. Another Ethereum staking protocol Lido Finance also raised $94 Million with the leading investor being Andreessen Horowitz.
FTX and FTX US, on the other hand, were the largest recipients of CeFi, having raised $800 Million in January and contributing to 18.6% of the total CeFi funding in 2022 alone. The crypto exchange infamously collapsed ten months later and filed for bankruptcy.
Alternate regions of investments comprise blockchain networks and blockchain technology firms, which collectively raised $2.8 Billion and $2.7 Billion respectively.
According to Henrik Andersson, the Chief Investment Officer of an Australia-based asset fund manager Apollo Crypto, there are four major sectors in the crypto industry. The first one is the amalgamation of NFT and Defi called the NFTfi. The second and third are on-chain derivative platforms and decentralized stablecoins, which have become more popular owing to the fall of FTX and the latest regulatory implementations. The fourth sector according to Andersson is the Ethereum-based layer-2 networks.
Andersson went on to explain that layer-2 tokens like Optimism (OP) have shown great promise until now, specifically when it comes to testnet launch of “Base”, which was designed by Coinbase and is backed by Optimism.
Previously, cryptocurrency analyst Miles Deutscher also estimated that zero-knowledge rollup tokens, liquid staking derivative tokens, and perpetual DEX tokens would function well in 2023 due to heavy backing by funds.
Sanaa is a chemistry major and a Blockchain enthusiast. As a science student, her research skills enable her to understand the intricacies of Financial Markets. She believes that Blockchain technology has the potential to revolutionize every industry in the world.
Celsius has been positioned as one of the leading yield-generating CeFi platforms on the market, battling neck-and-neck with other dedicated CeFi platforms such as BlockFi and Nexo. Their positioning is seemingly weakened this week, certainly with retail investors, as the platform sent out an announcement to all users and released a public announcement that new funds supplied – even from existing accounts – into Celsius’ platform would no longer be eligible to earn yield unless they are accredited investors.
Let’s look at what we know from today’s release, and the events that have led up to today’s announcement.
Celsius released an announcement on their company Twitter channel, and founder and CEO Alex Mashinsky offered up a similar thread of information on Twitter. However, neither channel offers much transparency behind the reasoning around the move, which has largely been credited by speculators to be the result of increased SEC scrutiny.
1/ @CelsiusNetwork is launching a Custody solution for our US users and introducing some changes to our services. Read on to learn about what’s changing and why…
— Alex Mashinsky (@Mashinsky) April 12, 2022
In the company’s official blog post on the matter, there was also little clarity on the why behind these changes. What we do know is that these changes were unlikely to be made at the behest of Celsius on their own, as the end result is more barriers to entry for retail consumers. It’s unclear the specific needs to be an accreditted investor on the Celsius platform. The company utilizes VerifyInvestor.com, which typically charges $70 per individual for a verification application. While Celsius is apparently eating the cost of verification, will small crypto users be verified? Large questions loom, and it’s likely that many will elect not to even attempt verification. The platform will roll-out it’s ‘Custody’ feature as it’s replacement for swapping, borrowing, and transferring tokens. However, the ‘Earn’ feature was undoubtedly a major drive for Celsius’ existing business.
Celsius offers a native platform token to earn boosted rewards, but to date has been unable to offer the token to U.S. users. These restrictions are seemingly progressing this week for United States-based customers. | Source: CEL-USD on TradingView.com
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Last year, we covered numerous stories of regulatory pressure applied to Celsius, BlockFi and the like. The pressure has largely come on a state-by-state basis, and certainly hasn’t been limited to Celsius. However, it seems that state pressures are still a major factor, as Celsius has specified in today’s report that there would still be limitations on availability surrounding it’s new ‘Custody’ product. Impacts of today’s report are limited solely to U.S.-based users.
Where we go from here remains to be seen.
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Featured image from Pexels, Charts from TradingView.com The writer of this content is not associated or affiliated with any of the parties mentioned in this article. This is not financial advice.