An Overview of DeFi Liquidity Mining Products in CEX

  • Who is the leader of DeFi liquid mining products in centralized exchanges
  • Exchanges have launched DeFi liquid mining products one after another, who can win
  • Today’s analysis: the layout of exchanges in the field of DeFi and derivatives

*Although the storage space Filecoin, Polkadot DOT and other projects are very popular in the market, in the final analysis, DeFi and its derivatives are still the first to open the market in 2020 and continue to this day. DeFi has continued to soar since the second quarter. It has caused many exchanges to innovate in this field.

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DeFi Market Size

The DeFi lock-up value (TVL) has seen multiple increases since April, from 700 million US dollars in early April to 8.3 billion US dollars at the end of August, which has attracted strong attention from the industry.

Starting from 1 Jan to 31 Aug 2020
Source: DeFiPulse, TokenInsight

Prior to this, centralized exchanges occupied the mainstream position of crypto market behavior, and decentralized exchanges (finance) with reactive responses. DeFi popularizes, and decentralized exchanges (finance) gradually altered the market behavior.

As the main field in the DeFi industry, the popularity of decentralized exchanges (DEX) continues to rise. The launch of Compound liquidity mining seems to have dropped a depth bomb on the market, causing an uproar. As of September, Uniswap’s trading volume surpassed Coinbase for the second consecutive day. This change of opportunity has brought the balance of the market to the DeFi field.

Overview of DeFi Projects

Among the centralized exchanges that have listed DeFi tokens, several platforms including BiKi, Huobi, Gate, etc., have more than 40 listed projects.

No of DeFi Listed Projects

Launch of DeFi Liquidity Mining

At present, the liquidity mining of DeFi is mainly a product that occurs on the Ethereum blockchain. It gains revenue by providing liquidity for DeFi products on the Ethereum. To put it simply, you can deposit certain token assets to mine. The reason why it is called mining is to follow the industry terms of Bitcoin mining. Simply put, liquidity mining is mainly through the provision of token assets, thereby obtaining income.

Liquidity mining may also be called Yield Farming, which uses smart contracts to transfer users’ funds between different lending markets to maximize returns. The assets pledged by users are equivalent to providing a pool of liquidity funds for smart contracts, and users do not need to transfer assets in various lending markets, eliminating complicated handling fees. For some beginner users, the barriers to entry to participate in DeFi is greatly reduced, because DeFi liquidity mining will automatically implement the best financial management strategy.

Analysis of DeFi Liquidity Mining on Three Centralized Exchanges

BiKi

Transaction mining
BiKi is the first platform among several major exchanges to launch DeFi liquid mining products. On September 2, BiKi announced that it will launch DeFi liquid mining, fully supporting DeFi hot projects liquidity one-click mining.

Users can start automatic mining through grid transaction pending orders, and automatically obtain liquidity mining income every day. At the same time, users can obtain liquidity mining rewards and double income of grid transactions. As the core battlefield of the DeFi ecosystem, BiKi has been opened More than 30+DeFi hot items spot and grid transactions, and the DeFi ecological zone is launched to fully develop the main DeFi battlefield.

Different from pledged currency mining and locked mining, BiKi combines the most stable trading strategy at the moment-grid trading, to continue DeFi liquidity mining, and to increase dual income while ensuring the safety and stability of user transactions. The “AI automatic trading strategy” that Grid Trading comes with can give beginner users a better participation experience.

When the user uses the Grid tool to open the Grid Trading of the above specified currency pair, the platform will take a random snapshot of the Grid order every day with the running time of 12 hours, obtaining the liquidity mining income of the currency pair Token on the second day.

Huobi

Lock-up mining
Huobi will start the first phase of “Lock-in HT/HPT Participation in DeFi Liquidity Mining” at 16:00 on September 7, in which HPT is the Huobi Pool Token. The first batch of Huobi will provide 5 million USDT equivalent value of blockchain assets for DeFi liquid mining (the first phase of 10 million USDT will be launched in batches). The rewards generated by mining (Curve token CRV) will all be given back to users who participate in the activity to lock HT and HPT.

Web users enter the event page by clicking the homepage banner, and APP users click the carousel picture on the APP homepage to lock their positions, and rewards will be distributed the next day. After HT is locked, it will be locked in the currency account, and it will be automatically unlocked on the day the event ends (the event period is 14 days) without manual operation by the user.

Binance

Binance announced on September 3 that its “Pledge Mining” platform will open BNB and USDT’s DeFi mining products subscription at 21:00 that day. Among them, BNB is used to participate in Kava (decentralized lending platform) mining, and USDT is used to participate in Curve (stable currency transaction liquidity pool) mining.

On September 6, Binance launched new coin mining products. Users can use BNB, BUSD or other designated token methods to mine (Farm) new coins. The first project to be issued on new coin mining is Bella Protocol (BEL). From 08:00 on September 9th, users can mine BEL tokens in the mining pools of BNB, BUSD, and ARPA for a total of 30 days.

Comparison of 3 major DeFi Liquid Mining Products

Among the DeFi liquid mining products of centralized exchanges, the BiKi platform supports mainstream coins, major platform coins, DeFi coins, small mining coins, model innovation coins and many other asset types, and has the most comprehensive, hottest and latest coins in the entire network Kind of, the highest increase of platform assets is as high as 150x. First, in terms of currency selection, it is not inferior to platforms such as Huobi and Binance, and it satisfies the demand for “liquidity” in DeFi liquidity mining.

The annualized rate of dual mining income of BiKi combined with grid trading is basically between 10% and 150%, which belongs to a relatively high category.

DeFi’s Future Outlook

With the intensification of competition in the centralized exchange industry, the rise of DeFi has provided space for exchanges to develop differentiated competitive advantages. Unlike the rise of the futures market, DeFi and derivatives have broken away from the monopoly of established trading platforms and attracted With the entry of various new forces, these new forces have not fallen behind in the face of traditional players.

Nowadays, integrating DeFi into its own ecology and future development in order to consolidate or develop its own core competitiveness has become a major test faced by various exchanges. Once again, on the basis of various new product projects one after another, the maturity of DeFi has not yet arrived, and it still needs to complement CeFi and jointly improve the construction of the underlying architecture.

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