Sasha Ivanov, founder and CEO of WAVES, warned of a possible "ICO Bubble" in the area of Decentralized Finance (DeFi). Ivanov compared the current interest in DeFi projects to the sudden flow of capital to ICO projects seen in 2017. As is known, ICOs eventually had a devastating effect and many investors around the world lost big sums of money. Waves CEO said he was concerned about growing enthusiasm while strongly believing in DeFi, and this could undermine the long-term development of DeFi.
DeFi is the future, but it's going to be coming through a bubble part of the cycle now, which can harm its long-term development. DeFi products are more sophisticated in nature than simple ICO tokens, which probably will limit the influx of non-qualified investors, but future inevitable volatility and price crashes can severely harm DeFi mass adoption perspectives, which would be very bright otherwise.
DeFi can be defined as the ecosystem of financial applications running on Blockchain. DeFi, which provides advantages to the financial world such as the elimination of intermediaries and central system risks, as well as the great reduction of costs, is the most popular use area on borrowing and lending. Borrowing and lending in DeFi has advantages such as instant credit opportunity, instant transaction termination, easy borrowing, easy lending, minimizing the need for trust, lack of credit control and virtually zero transaction costs compared to the traditional banking system.
Recently, many DeFi tokens, especially Compound (COMP), Aaeve (LEND) and Balancer (BAL), have come to the fore with the increase in prices.
