A Closer Look Into the Decentralized Liquidity

One of the most exciting development is the algorithmic-based smart contract liquidity pools such as Ethereum’s Uniswap. There are also other developments such as privacy-focused, off-chain DEX’s such as StarkDEX who is leading project in the decentralized liquidity technology.

The decentralized liquidity is one of the key factors of each Decentralized Finance because it helps the market to reach a growth that will enable security and prevent fluctuation of the token and coin prices that are listed on the DeFi platform.

And since the decentralized liquidity is still in the beginning, it struggles to provide a high decentralized liquidity so it can attract investors from all areas of the globe and keep the investors calm and relaxed and to not worry of a possible market price crash that can hurt their investment.

Source: Uniswap

As we can see on the image above, the current decentralized liquidity on Uniswap is reaching to an all time high of around 2.81 billion US dollars and a 24h volume of ~205 million US dollars. This proves that cryptocurrency investors are really excited and enjoying the new technology and someday this DeFi project or someone else can collect trillions of US dollars and dictate the whole financial market and be a huge threat for our current monetary system.

What are the benefit of providing decentralized liquidity?

  • By providing decentralized liquidity you are being rewarded with coins/tokes from the fees, thanks to this you can make the decentralized liquidity be your passive income.
  • Improve your portfolio by providing decentralized liquidity to various pairs and earn various tokens and coins.
  • You are helping the market to improve it’s strength and to offer steady and non-volatile prices.
  • By providing decentralized liquidity you are helping the volume to go up and to attract new investors that will be beneficial for all users of the DeFi project.

It is very exciting to be in the cryptocurrency sphere at this moment as new crypto trends are starting to emerge and evolve the whole crypto technology to a point that it makes it more useful and decentralized, built from people and sustained by people.