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Usually when people think of the decentralized finance (DeFi) system, we are looking at a new and a modern approach towards everything finance.
While there is no denying that the new concept could be facing some salient challenges that could affect its overall impact, DeFi would definitely affect the future of money.
What challenges does the DeFi industry face today?
Like we stated earlier, Defi is facing some level of challenges against it. Some of these challenges are:
Many Defi products offer unrealistic profit rate or revenue generation: Many Defi projects are guilty of promising their users an absurd level of profit with some of them going as far as luring users by offering them more rewards for their little investments. Many of these users do not know or understand how their invested money appreciates during its stay in the pool and as such, many are of the belief that such systems are unsustainable. This is why some users have continued to view the DeFi field with lots of scepticism and suspicion.
Lots of DeFi projects are still not user-friendly: Traditional financial systems are able to offer users a wide variety of ways to make money. The truth is however, that not all people have access to them.
DeFi also offers many ways to make money but this time, the tools are available for all. The downside is that users who want to have multiple investment options for their finance at once, have to switch between as DeFi projects. This makes them carry out the same repetitive and monotonous function of researching while also paying a transaction fee at each solution, which damages efficiency – and requires patience.
The lack of holistic solutions that would offer multiple investment options has turned many users away from the sector.
Only few DeFi projects are audited and compliant with the necessary regulations: DeFi projects are mostly run on smart contracts that have automated all forms of transactions. There is little to no human interference on how such transactions by human employees of the defi projects.
As such, users need to believe that these Defi projects would do exactly as they say, which is why there is always a need for their smart contract to be audited by major smart contract auditing firms in the industry. Not just that, users want to be sure that what they are doing is legal in the face of the law and that there is no probability of the authorities waking up one day and haunting the team so that all users flee, breaking down the system.
These requirements are not always met by DeFi projects and some of them are still working under the cloak of darkness. This has driven quite a number of users away from the sector as they’re not comfortable relying on the code and processes that have not been vetted by anyone.
So, if DeFi projects have these challenges, how would they change the future of money?
The answer to that lies in the new Defi projects that are kicking-off these days. These projects are learning from the mistakes of their older counterparts from the earlier days of DeFi while leveraging the best practices of the industry. One of the especially promising companies that is poised to play a crucial role in the maturing of DeFi is Nimbus.
Nimbus made its name as a Fintech company with repute after it delivered blockchain-based financial solutions to 50,000 unique users within a year.
On December 21, Nimbus is launching a new DeFi Ecosystem that provides users with access to IPOs, startup financing, P2P lending and other opportunities that are currently not even possible in fiat money for common people. The beautiful thing here is that all of this can be accessed via just one native token of the platform: NUS.
Multiple investment opportunities in one spot
All in all, NUS shall unlock 10 different earning strategies with different profitability levels for people worldwide. Finally, you will no longer have to switch between platforms in search of good opportunities. Instead, Nimbus offers it all in one spot.
Cutting-edge technology for tried-and-true investment opportunities
Moreover, unlike many other DeFi projects, Nimbus platform offers realistic and understandable revenue generation models. It leverages the best tools and investment opportunities that traditional finance has to offer, but in a decentralized manner.
This brings back the funds control to users but at the same time, does not compromise the profitability, as these tools have proved themselves over decades.
Pool technology for risk and upside optimization
It also enables users with any investment sum to participate. What creates this opportunity is the fact that dApps accumulate users’ funds in pools and then invest them in a diversified manner on the other side of the pool. This mitigates the risk of losing all your funds and increases your potential upside thanks to the fact that the investment gets highly diversified – be it between different startups, or between different IPOs, or perhaps all at once.
And finally, this also makes the entire ecosystem more likely to be used by common people who might not know what “staking” is (that is, a popular concept for receiving profits in DeFi) but who know precisely what IPOs are and why it’s great to participate in one.
Platforms like Nimbus are a great step forward for DeFi and a big challenge for the status quo of traditional finance. If we see more companies like this pop up in the DeFi space, we can be at ease knowing that one day, there are substantial chances for DeFi to become the next big thing and reshape how we see finance today.