The Decentralized Financial Market (DeFi) was instrumental in the crypto bull run of 2021. In fact, the DeFi market is currently projected to be an $ 800 billion industry by 2022. There has been an influx of DeFi projects into the market and most of them rely on the Ethereum network. However, the issue of transaction fees and speed in the Ethereum network has not given these DeFi projects a basis to exploit their full market potential. For example, the average network transaction fee is anywhere from $ 15 to $ 50 and can be as high as $ 300 on busy days.
This situation led some DeFi projects to start exploring other blockchain protocols with less transaction fees and more transaction speed. Here we take a look at the emerging DeFi projects outside of the Ethereum ecosystem.
The first on our list of upcoming DeFi projects outside of the Ethereum ecosystem is the Sovryn platform. Sovryn is a decentralized financial protocol (DeFi) built on top of the Bitcoin network. The project started in 2020 with only 5 developers and was officially launched in April 2021. Today Sovryn has a core of over 60 contributors working on the project. It enables users to trade, loan, and borrow without personal information. Sovryn is currently the only truly decentralized financial protocol based on the Bitcoin network. Users also keep the keys to their assets; Hence, they are in control of the protocol.
Since its inception in April, Sovryn has facilitated an estimated $ 568 million, $ 77 million Total Value Locked (TVL) and $ 551 million Assets Under Management (AUM) transactions. Savryn also enables its users to participate in margin trading, swaps and the provision of liquidity.
A decentralized cohort of different interest groups regulates the Sovryn protocol (Bitocracy). There is no single instance that controls the direction of the protocol. The project also offers gas fees that are 0.01% of what is available on Ethereum. The privacy of the users is protected as the protocol is completely permissionless. Also, the Sovryn protocol is Ethereum Virtual Machine (EVM), which means it can be used on any blockchain platform. Notable features include Origins Launchpad, FastBTC Relay, Fait On-Ramp, and Leveraged Trades.
Clover is a blockchain-based operating system with a decentralized financial protocol layer and other layers such as storage, smart contract and eApp. The system is based on the Polkadot blockchain network. The project supports various basic DeFi protocols such as swaps, loans, credits, insurance and many more. According to Clover Litepaper, the project forms a basis for the smooth operation of DeFi applications. The team also aims to enable a gasless transaction layer to provide a simplified and convenient experience for users.
The Clover team is currently working to join as Parachain for Polkadot to achieve a high level of interoperability and to become a renowned DeFi provider on the Polkadot blockchain. Clover is currently developing a number of cross-chain implementations, ranging from desktop to mobile, so that users can seamlessly interact with DeFi applications from multiple front ends. Aside from bridging Ethereum and Polkadot in a unified space, Clover has developed an EVM-compatible infrastructure.
SORA is a decentralized multiverse economic system that decentralizes the concept of a central bank. It seeks to develop a Parachain blockchain that connects to the Polkadot relay chain and the ecosystem using built-in tools that focus on DeFi. The SORA network thrives on developing tools for decentralized applications that use digital assets like Atomic Token Swaps, bridge tokens to other blockchains and develop programmatic rules for digital assets.
The SORA project is completely decentralized and depends on its community members to operate nodes. The validator nodes are responsible for creating blocks in the SORA network. The SORA DeFi ecosystem uses three different tokens. The SOR token is used to pay transaction (gas) fees within the network. There is also the VAL token, which is used to reward validators on the SORA network. Finally, the PSWAP is used to reward liquidity providers on Polkaswap through the SORA network. It uses the Polkadot Protocol and Parity Substrates to improve scalability better than Ethereum, and it doesn’t use an expensive consensus mining process.
xWin is a decentralized fund management platform based on the Binance Smart Chain (BSC). With xWin Finance anyone with their trading or fund management skills can open their own funds. Users can then subscribe to these funds and earn profits in return. xWin aims to create a one-stop DeFi protocol that will enable any beginner to benefit from the largest wealth transfer in recent human history.
xWin Finance also serves as a sector index, where it provides a range of sector index funds in the Binance Smart Chain. The platform makes it easier for beginners in the DeFi ecosystem to diversify their portfolios. So far there are three sector indices in the mainnet, including the xWin BSC DeFi Index (xWin-DeFi), the xWin Binance-Peg Infra Index (xWin-XFI), the xWin Collectibles & NFT Index (xWin-NFT) and the Japan Crypto Index (JPI ).
To make investing easier than ever, the team is aiming to introduce a range of BSC ecosystem indices based on the current landscape. You chose Binance Smart Chain over Ethereum because it’s faster and cheaper. BSC’s superior transaction speed and its lower transaction fees ensured that it was chosen over Ethereum. xWin certainly deserves its place on this list of upcoming DeFi projects from the Ethereum blockchain network.
As DeFi innovators continue to seek solutions to the shortcomings of the Ethereum blockchain, more emerging projects outside of the Ethereum ecosystem will be launched. However, these emerging projects need to spend sufficient time in the market before they can really compete with the leading Ethereum projects.