Klever
  • Home
  • Global
  • Exchange
  • Wallet
  • Education
  • NFTs
  • Announcements
  • Opinions
  • Marketcap
No Result
View All Result
  • Login
  • Register
Klever News
  • Home
  • Global
  • Exchange
  • Wallet
  • Education
  • NFTs
  • Announcements
  • Opinions
  • Marketcap
No Result
View All Result
Klever News
Home Global
defi

What is DeFi 2.0?

by Jagdish Kumar
February 17, 2022
in Global
Reading Time: 3 mins read
3k
A A
0
Share on FacebookShare on Twitter

DeFi 2.0 is a new system built on the existing DeFi which primarily focuses on liquidity and incentivization.  

As DeFi was a revolutionary idea in providing decentralized financial services to anyone with a crypto wallet, DeFi 2.0 will add a feature that improves the current DeFi system.

You might also like

Introducing K5, The Crypto Wallet Of The Future

Introducing K5, The Crypto Wallet Of The Future

January 26, 2023
7.3k
How blockchains and cryptocurrency will revolutionize supply chains.

How blockchains and cryptocurrency will revolutionize supply chains

January 23, 2023
7.3k

DeFi 2.0 adds new features like meeting new compliance regulations like knowing your customer (KYC) and anti-money laundering (AML) that governments globally plan to introduce. 

It solves DeFi limitations like scalability, third-party information, centralization, liquidity, and security issues that have plagued the decentralized finance system till today.

Liquidity providers face a high degree of risk in adopting new technology and prices can change very quickly, resulting in an impermanent loss. DeFi 2.0 addresses this risk by providing loss insurance. Smart contracts are also protected by smart contract insurance.  

As we have seen layers built on blockchain platforms like Bitcoin and Ethereum, DeFi 2.0 is also built the same way to solve various anomalies in the current DeFi ecosystem.

 The newly added features solve the lending system, as DeFi 2.0 payoff loans themselves with a self-repaying option. In this, loans use collateral from yield farming to pay off the loan balance, when the due date comes and the balance collateral is returned to the owner. 

Whereas earlier, DeFi uses the traditional lending features where users borrow funds from other users with interest after supplying a hefty amount as collateral.

Benefits of Defi 2.0

Consistent liquidity supply

DeFi 2.0 always provides much more consistency in providing liquidity, just like banks provide liquidity to their clients. Just because there is a higher yield, users don’t move from one DeFi to another, which can cause a liquidity crisis. Defi 2.0 can more efficiently allocate liquidity to the protocols that need them.

Default risk to end-users

It insulates the liquidity provider from impermanent losses and defaults. When users withdraw the money from their account they get the original amount they deposited plus interest. In some DeFi 2.0 platforms, users are getting a higher market value when they sell native tokens to parent platforms. In this way, the DeFi platform is now responsible for any risk in providing liquidity. Therefore, the brunt of the impermanent loss problem is now transferred to the DeFi 2.0 platform.

Decentralized bank

Instead of asking users to lend their personal tokens for liquidity, DeFi 2.0 acts as a decentralized bank and takes over the role of liquidity provider. This bank accumulates the tokens in what is referred to as treasuries and stakes these tokens directly at exchanges or lends out the tokens. The users are then rewarded in bank tokens instead of the native token they stake.

Empowering DOAs

With this, users can buy or sell tokens that distribute governance authority for DAOs among token holders. The benefits of DAO participation depend on the purpose of the organization. DeFi 2.0 is also building protocol-controlled value mechanisms that are poised to benefit DAOs.

DeFi 2.0 is changing the way DeFi has been under implementation for the past two years. DeFi has been a big hit in crypto and new ways to mitigate the issues will further help DeFi to stand and offer an alternative to users that have been looking towards DeFi for meeting their financial needs and that too by attaining financial independence.

Tags: decentralized financedefidefi 2.0
Previous Post

Top 10 Klever Crypto Security Tips

Next Post

KApps the new and improved DApps from Klever Finance

Jagdish Kumar

Jagdish Kumar

Reporting & writing on crypto & blockchain for the past few years. A content eagle, journalist & writer with a passion to explore new technologies that can change human lives. Joined Klever to make Crypto simple. Follow me on Twitter @TokenBharat or email me at jagdish@klever.io

Related Stories

Introducing K5, The Crypto Wallet Of The Future

Introducing K5, The Crypto Wallet Of The Future

by Klever
January 26, 2023
0
7.3k

KleverOS, the revolutionary Klever crypto wallet operating system that powers K5, ushers in a new era of crypto wallets. Today,...

How blockchains and cryptocurrency will revolutionize supply chains.

How blockchains and cryptocurrency will revolutionize supply chains

by Warren Manuel
January 23, 2023
0
7.3k

Supply chain management and logistics is a critical aspect of any business, as it involves the coordination and movement of...

Financial inclusion in the unbanked through cryptocurrency and blockchain

Financial inclusion in the unbanked through cryptocurrency and blockchain

by Warren Manuel
January 21, 2023
0
7.3k

The Role of Cryptocurrency and Blockchain in Enabling Financial Inclusion for the Unbanked and Underbanked Cryptocurrency and blockchain technology have...

Crypto mining alternatives

Alternatives to cryptocurrency mining that would be more sustainable

by Warren Manuel
January 19, 2023
0
7.3k

The Environmental Impact of Cryptocurrency Mining and the Potential for More Sustainable Alternatives Cryptocurrency mining, the process of using computer...

Next Post
kapps the new dapps

KApps the new and improved DApps from Klever Finance

metaverse

3 Technology leading companies are exploring the Metaverse

Download Klever Wallet Download Klever Wallet Download Klever Wallet
ADVERTISEMENT

Recommended

Ethereum

Coin of the Week: Ethereum (ETH)

November 14, 2021
7.5k
Tron (TRX)

Coin of the Week: Tron (TRX)

May 19, 2022
7.5k

Popular Story

  • Stand a chance to win your share of 10,000 KLV

    Stand a chance to win your share of 10,000 KLV

    8332 shares
    Share 3333 Tweet 2083
  • Test drive Klever Wallet, K5 and Win 1000 KLV & 1 KFI

    7018 shares
    Share 2807 Tweet 1755
  • Bitcoin battles back from record losses to $21,000

    5913 shares
    Share 2365 Tweet 1478
  • Klever showcases its blockchain ecosystem on a Time Square billboard

    5357 shares
    Share 2143 Tweet 1339
  • K5 adds new blockchain and KleverSafe support in the latest Android version

    5070 shares
    Share 2028 Tweet 1268

Follow us on Twitter

Klever News

Join the Klever community
Growing together we are stronger.
Be sure to follow us on social media to stay up to date.

Categories

  • Announcements
  • Coin of the Week
  • Education
  • Exchange
  • Games
  • Global
  • Hardware Wallet
  • Market Updates
  • NFTs
  • Opinions
  • Sponsored
  • Wallet
Download Klever Wallet Download Klever Wallet Download Klever Wallet
ADVERTISEMENT

Recent News

Introducing K5, The Crypto Wallet Of The Future

Introducing K5, The Crypto Wallet Of The Future

January 26, 2023
How blockchains and cryptocurrency will revolutionize supply chains.

How blockchains and cryptocurrency will revolutionize supply chains

January 23, 2023
  • Sponsored Content
  • Advertise
  • Contact Us
  • RSS Feed

© 2022 Klever News - Premium Crypto news & insights by Klever Finance.

  • Login
  • Sign Up
No Result
View All Result
  • Home
  • Global
  • Exchange
  • Wallet
  • Education
  • NFTs
  • Announcements
  • Opinions
  • Marketcap

Welcome Back!

Sign In with Google
OR

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Sign Up with Google
OR

Fill the forms below to register

*By registering into our website, you agree to the Terms & Conditions and Privacy Policy.
All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
-
00:00
00:00

Queue

Update Required Flash plugin
-
00:00
00:00
Go to mobile version