Crypto Academy Week 4 // An Introduction to Decentralized Finance (DeFi) // Submitted to @yohan2on

It's already week 4 in the Crypto academy lectures and am glad to be your student again this week @yohan2on

Homework task for this week lectures

Homework task: Briefly explain each of the following DeFi Dapps
Maker
Compound
Synthetix
bZx
Uniswap

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Decentalized Finance (DeFi)
Taking reference from the Lectures, a decentralized Finance is the uses of funds (whether staking, lending, borrowing, etc), without the need of a central control body. I believe most evolving protocols are off Defi's and soon centralized will be overtaken.

Homework task

Maker
It is one of the earliest project on DeFi and it allows decentralized product to be built on a smart contract in which the blockchain is enabled. It can be Called an utility token.

MKR’s utility token aspect is based on the concept that it is the only token that can be used to pay the fees for creating a CDP to generate Dai. source

When once this fees are paid MKR is exhausted and destroyed. As more of it is burned, it's value will appreciate, so that very small amount is used to perform transactions.

It was created to ensure the stability of the DAi stable coin. A stable coin is that coin that is the same price when compared to a dollar.
Marker has a protocol enable smart contracts which helps it monitor the price. fluctuations. Every decision made within its ecosystem is done by votes, MKR is a governance token and can be used to vote for projects, make decisions, etc.

Compound
Compound is basically decentralized Etherum based protocol which allows users to lend and borrow asset. Certain cryptocurrency can be locked for lending purposes. Currencies such as tether, Dai, USDT, usdc, and many other can be uses for lending on Compound. Locking your asset can be compared to locking your fiat currencies in a fixed bank deposit, the interest realised will be paid to you.

In a decentralized network like compound, your cryptos are deposited in a compound wallet which can be used to borrow fund to other, you can also borrow if you deem it fit to but you cannot borrow more than your locked value.
COMP is the governing token for compound and a precalculated amount is distributed to all lenders and borrowers everyday. This distribution occurs each time an Etherum block is mined. The tokens are also used to vote for new project, and many more.

Synthetix
It is a DeFi protocol that makes available to users crypto and non-crypto assets. Synthetix is of the Etherum blockchain, which provide users with liquid assets in form of SNX tokens. It is a decentralized protocol eliminating the need for a thirds party control. It is able to track underlying asset by the functioning smart contract price delivery protocol which is referred to as Oracles. Also available on Synthetix is a staking pool which rewards it stakers with SNX tokens.

SNX tokens is its governing token which is used for voting new project. SNX tokens are also used as collateral for minted SNX assets.

BZx
BZx can be described as an Etherum based DeFi lending protocol, it allow users to borrow, lend and even get involved in margin trade. It seeks to rules the need for centralized monitoring, since it is a decentralized protocol. These process are automated by built in smart contracts. Lenders are given incentives while borrows pays for borrowing funds. By borrowing and lending assest are being moved in and out of Brx liquidity pools, lenders who supply funds to liquidity pools receive itokens, while those borrowing recieve pTokens.

BZRX is the governance token for BZx, which can be put into staking pools or for voting purposes.

Uniswap

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Uniswap has been affected by gas fees arising from too many transactions been received by the Etherum blockchain.

Uniswap is a decentralized protocol built on top the Etherum blockchain, it allow swap tokens mostly ERC-20 tokens, providing liquid to the pool. It is fully decentralized and operated on an Automated liquidity protocol. On Uniswap anyone can provide liquidity not just that, tokens are been distributed for providing this liquidity. This ensures that transactions are effected quickly not giving room for too much of a queue.

It's protocol which built on a smart contract (exchange and factory contracts) has also eliminated the need for an other book but rather operates in an automated market makers (AMM).

UNI which is the governance token for Uniswap is used for voting new contracts and new development on the platform.

Thanks to you Prof. I have actually learnt Alot here.