Blockchain investment company Hashkey Capital has published a report on decentralized finance. In it, Hashkey argues that DeFi has more scalability potential than traditional finance.. Moreover, the report states that decentralized protocols are much more resilient to events such as the collapse of Terra/Luna.
However, market conditions prevailing in 2022 contributed to a decline in the value of total assets under management. Lower prices for cryptocurrencies, the report says, have also been reflected in the value of collateral provided in DeFi lending.. In addition, activity on decentralized exchanges (DEX) and cryptocurrency trading volumes have decreased.
According to the report, in December 2021, the total value of assets locked (TVL) in smart contracts reached $180 billion, by May 2022 the figure fell to $150 billion, and by the end of October – to $50 billion.. However, some DeFi protocols are still showing positive momentum.. The rate of adoption of DeFi has also slowed down: in 2021 it was about 550%, and in 2022 it was only 31%.
“In general, 2022 can be called the year in which DeFi projects have dedicated their time and resources to improving products, rather than promotional activities.. The user interfaces of DeFi protocols have improved significantly – many of them can now be said to be much more convenient than some banking applications, ”Hashkey writes.
Earlier, the US Financial Crime Enforcement Network (FinCEN) announced that it intends to study how decentralized finance affects the situation with crime in the banking sector.