Repost For DeFi Products - Crypto Academy / S4W8- Homework Post for @reminiscence01
Link to Initial Post - https://steemit.com/hive-108451/@preshymukel/defi-products-crypto-academy-s4w8-homework-post-for-reminiscence01
Edited in Canva
Hello Steemians..... Greetings from this side. I am here again in the week 8 of the season 4 edition in the Steemit Crypto Academy with the homework post of Professer @reminiscence01 tagged “DeFi Products”.
Introduction
The development of DeFi came with the evolution of the human race economic, cryptocurrencies came into existence and the economic was innovated and a better level was developed which led to an ease in the exchange of goods and services.
In the past, the whole financial system was centralized, i.e the finance system was governed by central authorities who serve as intermediaries and this centralized system really underpinned the economy. Subsequently, the Decentralized Finance system was created which impeded the centralized system.
The DeFi system was created so that the financial system can be decentralized, transparent and self-reliance instead of trusting authorities to manage funds.
DeFi was ushered in through the launch if Bitcoin in 2009 which happened to be the first peer-to-peer digital currency that operates on a blockchain. Further more, Ethereum was launched and smart contracts were built on the the blockchain which usher in fully the DeFi system.
Today DeFi has evolved into a full ecosystem and it is adopted by many people which is leading to the disruption of the traditional financial system.
1 a) In your own words, explain DeFi products and how it is shaping the present-day finance.
b) Explain the benefits of DeFi products to crypto users.
Decentralized Finance (DeFi)
DeFi is the acronym for Decentralized Finance, it is simply a decentralized digital money that operates on blockchains. The Decentralized Finance aimed at impeding the traditional finance system. The development of DeFi on blockchain technology was for the enablement of different financial services on the blockchain such as smart contract. Decentralized Finance on the blockchain is not controlled by any authority and it operates in a permissionless and peer-to-peer manner.
DeFi Products are decentralized financial protocols built on blockchain with the goal to redefine traditional financial system and usher in decentralized financial system thereby impeding intermediaries in the financial system and introducing a transparent, secured and self-reliance financial system.
DeFi products operating on blockchains is used to restructure the services of the traditional financial such as lending, payment of bills, investment etc and it has help shaped the present-day finance by ushering in a financial system that disrupt the existence of intermediaries in the financial system and bringing into existence a financial system that is more transparent, secured, and self-reliance. And also with DeFi products one can access financial services at anytime and place without stress as long as there is internet connection.
Some Importance of DeFi Products to crypto users.
Decentralized and Permissionless: DeFi grant freedom to users by eliminating middlemen and thereby making users to be in charge and in full control of their assets. Users perform transaction on the DeFi ecosystem at any point in time permissionless or any form of restrictions from any entity because they are in full control of their assets.
DeFi is Immutable: Blockchain was able to obtain immutability through cryptography and consensus algorithms which has help DeFi to partake in this immutability nature.
The fact that DeFi is immutable makes the system more secured because the immutable nature makes it impossible for any information on the blockchain to be altered or changed.
Also the immutable nature also protects the moral and ethics of the DeFi system.DeFi is transparent in nature: Transparency is one of the benefits of DeFi product. DeFi products are made public on the blockchain and this makes it easy for participants to read and understand how it operates. Also DeFi transactions are made public on the blockchain after they have been verified and considered authentic and this makes it impossible for transactions to be altered.
The transparent nature of DeFi also makes it possible for participants to be able to recognize financial frauds.Low Cost of Transactions: Transactions of DeFi products are considerably low compared to the traditional financial transactions which imposes high transactions fees on users. High transaction fee was able to be eliminated in the DeFi system due to the fact that it does not involve intermediaries in its transactions. The low transaction fee rate is one of the most beneficial aspects of the decentralized finance system.
Tokenization: Smart contract which is a DeFi product brings about the emerging of new tokens on blockchain thereby exposing these tokens to the digital world. These tokens includes digital tokens such as utility tokens, security tokens etc. used on the blockchain for different purposes.
Savings Purpose: DeFi application also open a digital means where crypto users can save and manage their funds.
User who lock their assets and participate in lending protocols such as yield farming can gain interest, the DeFi system thereby help users to save up on the system and earn more assets.
2) Discuss any DEX project built on the following network.
Binance Smart Chain
Tron Blockchain
JUSTSWAP
Justswap is a decentralized exchange built on the Tron Blockchain which was launched in August 2020.
The platform is used basically for the exchange and swapping of TRON-based tokens (TRC20 tokens).
Transaction fees on the JustSwap platform are allocated to liquidity providers and not the protocol itself.
The native token of the JustSwap decentralized exchange is known as JUST (JST) which has been in circulation since its launch, and it is the token used on the platform for its maintenance and it is also used by users to perform transactions and participate in different protocols in the platform.
The JUST token can be earn via participating in protocols, trading and mining etc.
Features of JustSwap platform
Decentralization: The platform is decentralized in nature which means that users are in full control of their tokens and they decided when and how to use them.
Permissionless: The JustSwap platform is open and can be accessed by anyone at any point in time as it is intermediary free. Users can transact in the platform without any restrictions from a middleman.
Secured and reliable: The fact that the JustSwap system is decentralized it makes it more secured and almost impossible to be hacked, and the conversation of tokens is done with ease.
Efficiency: Transactions on the JustSwap platform is very fast with low transactions fee.
JustSwap Developers
The JustSwap platform was developed by the JUST Foundation. Some team members of the JUST Foundation includes;
- Elvis Zhang: The Senior developer of the team.
- Terance F: Blockchain expert of the team.
- GL Kong: The Blockchain Engineer.
- C Wu: An expert in exchanges and wallets.
3) In the DEX projects mentioned in question 3, give a detailed illustration of how to swap cryptocurrencies by swapping any crypto asset of your choice. Show proof of transaction from block explorer. (Screenshots needed)
The process of swapping of tokens on JustSwap can be done through the following procedures;
- You start by visiting the JustSwap website or by visiting you Tronlink wallet. In my own case I went through my Tronlink wallet.
When you open your Tronlink wallet click on Discover.
From my Tronlink Wallet
- Click on JustSwap.
From my Tronlink Wallet
- Select the tokens you want to swap on the menu, input the amount to be swapped. In this illustration I’ll be swapping 5 TRX to 14.6477412499405702 SUN token.
From my Tronlink Wallet
Click on confirm swap to continue.
From my Tronlink Wallet
An authorization page will pop up, click on continue.
From my Tronlink Wallet
By agreeing to the terms and conditions of the smart contract click on confirm.
From my Tronlink Wallet
Input your password and click on done.
From my Tronlink Wallet
The Transaction was successfully completed.
From my Tronlink Wallet
Proof of my Transaction on TronScan
Conclusion
The Decentralized Finance (DeFi) world is on the path of immerse growth as more users are adopting it seeing its features and benefits. I think in time to come the Decentralized Finance will completely eliminate the traditional finace system.
Special regard to Prof. @reminiscence01 for the superb lecture.
