The importance of the DJED Credit Facility on Tron to the future of Steem and Steemit.

shortsegments (77)in #decentralized-finance • 4 years ago (edited)

The purpose of this post is to review what The DJED Credit Facility is on the Tron blockchain, review what we know about how it works based on the information published by the organization running it and to explain why you should care.

The Djed platform is currently live on the Tronscan.org domain. The Djed is a credit facility, and as a lending platform, Djed uses Collateralized Debt Positions (CDP). Its users need to pay an interest rate called a Stability Fee on their loans, the amount of which is determined through by the Interim Risk Team at Djed. The Djed platform is said to be modeled after the MakerDao platform on the Ethereum blockchain, whose code is open source. There have been plenty of news articles focusing on the code and how it’s similar to the open source code of the MakerDao on the Ethereum blockchain. Personally, there are multiple reasons that the story is bigger then that idea or perception alone.

First, I think we should remember that one of the main purposes of open source code is that it can be shared, improved upon and that it is the starting point for innovation. Which is usually defined as a better way of doing something.
Therefore, I think when we look at the DJED Credit Facility we should focus on how it’s structure, scalability and reduces costs compared to the Ethereum blockchain and the MakerDao. In addition to feeling that the focus should be on how and why the DJED Credit Facility is different from the MakerDao and objective appraisal of the innovations it brings to the Decentralized Finance space.

Second, Mr. Justin Sun’s organization has done something historic by creating a Decentralized Finance Credit Facility which is NOT on the Ethereum blockchain. There are some outstanding blockchains in this space, including Tron, Eijin, Wax and of course Steem. Ethereum is the 3rd oldest blockchain. It’s place in history and it’s continuing relevance is indisputable. But the potential and capabilities of these other blockchains are overshadowed by the legacy of Ethereum. Ethereum is constantly functioning with crazy volume and volume mediated delays and transactional issues.
But...
It’s time for some of that volume to move to the other chains.
It’s time for the other chains to shine and show what they are capable of to the world and be recognized for their technological achievements.

Third, as for Steem there are multiple upsides here, as we had a nice upward bump in the price of Steem by 25% on the day of the announcement. Plus publicity for Tron is publicity for Steem. News stories about M. Justin Sun, CEO of Tron always mention that he recently bought Steemit, Inc. The Steem blockchain lacked publicity and exposure for 2 years, but we are getting it now. Lastly, once a credit facility is established and running on Tron it is possible to establish one here also. A credit facility requires investors to buy and hold Steem, along with SBD. This is another use case for Steem. Additionally the current volume on the MakerDao on Ethereum is 2 billion US dollars per month. That’s Billion with a capitol B.
I wish to emphasize that a billion is a thousand times a million. If we got 1/1000 of that volume here on Steem it would be a million dollars in transactions a month. That would definitely raise the price and valuation of Steem. Decentralized Finance is very big, and is a very important use case for a cryptocurrency Token. Don’t let anyone convince you otherwise.

Lastly, because of the size of Tron and the publicity Mr. Sun’s organization is creating, this is going to help not just Tron, but also other platforms which use smart contracts and perform Tokenization of assets. This helps other blockchains to break the monopoly Ethereum has on Smart Contract decentraluzed finance. This is a moment which is bigger then Steem and bigger then Tron, this my friends is history.

Stay informed my friends, knowledge can create wealth and wealth is life changing.

✍🏼 written by Shortsegments.

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