The DeFi boom has taken the world by storm. With more people turning to it for investment indicates that DeFi has claimed its significance.
Ethereum’s initial price surge in 2020 was also attributed to the Decentralized Finances. A few days ago, when the crypto market went down in the red zone, the DeFi oriented tokens were at their all-time high. A digital asset like Ripple XRP also known as the fourth biggest cryptocurrency is looking to implement DeFi to leverage its growth.
As Defiye previously wrote that the DeFi industry is outperforming Bitcoin and other digital assets. While the statistics show that DeFi is making an impact with its rapid growth, few developers believe that it will migrate to a centralized platform.
On funky Crypto Podcast of Ben Askren, developer Udi Wertheimer claimed that the DeFi projects will shift from Ethereum to a centralized platform. Wertheimer believes DeFi and ETH locked in the vaults are the major reason behind Ethereum’s recent downtrend.
On the podcast, Litecoin Foundation Chief Evangelist John Kim was also present where he was discussing the cryptocurrency market’s downtrend. Wertheimer described the DeFi and how ethers locked in the vaults lead to a downfall in the ETH price.
DeFi does not need Ethereum
Wertheimer is bearish about Ethereum but appreciates the efforts of Buterin. In Wertheimer’s opinion, Ethereum is not any good for the community as its transaction fees are a little lofty and extremely slow. He further said DeFi does not require Ethereum anymore. He said:
“In my opinion, this whole DeFi thing, it stands for decentralized finance. And actually, there’s nothing decentralized about it because there’s always someone who controls those projects. As we saw now with the SUSHI thing…They launched a token but the actual project hardly even exists. So obviously it’s not decentralized…All of these projects have someone who is in control.”
Wertheimer believes that DeFi will not stay on the Ethereum network for long. And he also mentioned Yearn.Finance (YFI) whose value went to an all-time high of 30,000 from zero prior to losing more than half of its value. He said that YFI is a potential project but pointed out that it is controlled by an entity, unlike Bitcoin.
“In my opinion, the way it’s going, if it survives, it’s going to get out of Ethereum and into centralized platforms simply because they’re cheaper and they’re faster. And you don’t lose anything because it’s already decentralized…Whatever decentralized even means is up for debate, but we know these projects aren’t that, Wertheimer said.”
At last, Wertheimer added:
“I just don’t think that the blockchain technology applies to many things if at all. I don’t think it can make very good use of most cases…Just as a recent example, this whole DeFi stuff…Why are they using a blockchain? It’s just slowing things down. It’s just making things expensive. So I think that most applications that use a blockchain will eventually migrate off of it.”
As per Wertheimer, Blockchain technology is all about creating assets that are not controlled by anyone, for instance, Bitcoin.