That is DeFi?
DeFi, or Decentralized Finance, is the evolution of traditional CeFi (Centralized Finance) where banks are playing the main role in economics.
Traditional economic system makes you to use banks for all the operations with your money — sending, getting, taking loans, earning interest on deposits, etc. Such a monopoly allows them to dictate their own terms of the game, including establishing high fees on internal and international transfers, low or even negative interest rates on deposits and so on. Banks can also froze your funds due to some kind of misunderstandings which is not pleasant at all.
The new Decentralized Finance system is devoid of the majority of these banks disadvantages because of the power of blockchain technology. DeFi allows you to have a full control over your funds along with cool advantages like high interest rates on deposits and flexible loans terms.
Still, one of the biggest problems DeFi users are facing on is the low capacity of Layer-1 Protocols, the most popular of which is Ethereum. This causes high fees and makes Decentralized Finance almost unacceptable for people with small assets portfolio.
How Radix solves DeFi issues?
Radix team has been developing decentralized networks during the last 8 years having a huge experience in this area, so instead of making another simple Layer-2 solution on slow Ethereum they build a Layer-1 Protocol which will soon be competing with such blockchain space giants as Ethereum, EOS, Cosmos, Polkadot, Algorand, NEAR, Avalanche, etc.
Radix Protocol is using Parallelized BFT Consensus which best suites for Networks with high transactional throughput demands.
Below are the the key Radix advantages in DeFi space.
Access
It is really difficult new cryptocurrency space users to understand on how to make such basic DeFi things as putting your funds into a liquidity pools or taking a loan on blockchain. Also, high fees (especially for calling Smart Contracts) make DeFi almost inaccessible for users who just want to test it or to play with a small amount of money. You just can not afford yourself to put 50$ into a liquidity pool if the transaction fees will cost more than a half of your initial funds.
Radix approach makes DeFi as simple and friction-free as possible along with cutting the transaction fees which allows to onboard many new users.
Liquidity
The majority of cryptocurrency tokens have their liquidity spreaded among different platforms and it is almost impossible to connect them in order to get access to full liquidity and best prices.
Radix platform provides native functionality for everyone, including developers and Market Makers to create and access liquidity pools at the call of an API.
Actually, the lack of liquidity is one of the reasons some users prefer centralized solutions instead of DeFi. By solving this problem Radix will be able to attract some Centralized Exchanges users.
Choice
Radix also standardizing and simplifying the way of representation of assets on their platform providing access for both traditional and new financial products. This aggregates a large number of assets on the platform.
Summary
Radix DLT is a fast, secure and simple in usage Layer-1 Protocol designed both for users an developers. It’s simpleness and low transaction fees will onboard many new users, while various technical instruments for developers will help to build a powerful ecosystem.
Website: https://www.radixdlt.com/
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