What Is DeFiChain (DFI)? How It Works & Where To Buy It

DeFiChain (DFI) is a unique project that has built DeFi products on the Bitcoin blockchain.

The project aims to provide enhanced functionality to the Bitcoin blockchain and leverage the security of the world’s most trusted blockchain. The project offers an array of valuable digital products and has quickly managed to grow its user base exponentially.

DFI is currently the 63rd largest cryptocurrency by market cap.

How DeFiChain (DFI) Works

DeFiChain is a software platform that is backed by a distributed network of computers, devoted to rapid transactions. In addition to that, it is transparent and available to everyone and anywhere in the world.

To be more specific, DeFiChain was developed to enable a variety of financial services, everything that a traditional commercial bank is capable of doing, and more. The decentralized nature of DeFiChain contrasts sharply with the centralized nature of traditional financial networks.

An advantage of the transparent decentralized financial services platform is that it cannot be controlled by a single authority or institution, and anybody may take part by participating in the running of the network protocol on their own personal computers. Individuals that contribute to the overall functioning of the network by running the network’s protocol are rewarded with the DFI cryptocurrency as a kind of remuneration for their efforts.

Users are able to unlock the potential of decentralized finance through a host of decentralized assets including liquidity mining and more on the Defichain network. Defichain is a decentralized blockchain platform that is seeking to improve much more than the traditional banking network; it seeks to evolve the functionality of the Bitcoin blockchain.

In doing so, it provides unparalleled high transaction throughput that isn’t commonly seen from projects in the crypto market.

An important consideration to note about the security of Defichain is that it is non-Turing complete, thus making the smart contract programming language used by DeFiChain seen as more secure. This method of ensuring the safety of smart contracts is not original, and other blockchains are providing non-Turing complete programming languages specifically for this reason.

The Bitcoin protocol itself adds an additional layer of protection. Even if the Bitcoin network is incapable of achieving the requisite transaction rates for the vast majority of DeFi apps, it’s nevertheless held in high regard as the most robust network that has been developed to this day.

DeFiChain performs a process similar to a computer backup to the cloud by taking a cryptographic picture of the network’s most recent state and storing it on Bitcoin’s blockchain. This process occurs every few minutes. Anchoring is the term for this process, and for obvious reasons, the security of DeFiChain depends on its connection to Bitcoin.

The strength of the iconic PoW method provides an additional layer of protection for the network. Even though PoW is the protocol that ensures consensus on the network, Proof of Work is still important since it identifies blocks with their own distinct hash IDs.

Proof of Stake is an effective method that’s energy-efficient for arriving at consensus; however, just establishing the blockchain is not sufficient on its own since it does not include the unique hash ID. This may be produced by a group of computing nodes, the main responsibility of which is to provide the blockchain with a cryptographic security layer.

Users seeking more detailed information can read through the Defichain whitepaper.

 

What Is DeFiChain (DFI) Used For?

The DeFiChain network’s native cryptocurrency is denoted by the symbol DFI. The network makes it possible to create and distribute virtual currencies or tokens, including assets that symbolize the USD, a number of shares, dividends, certificates of ownership for an item, and many more types of tokens.

These coins are considered non-native tokens that are used on the network. Additionally, DFI is the only crypto in the DeFiChain system that can be used to pay for transferring of tokens, issuing of tokens, governance rights, and various actions including lending, borrowing, and staking. More will be discussed on this topic in the following paragraphs.

Additionally, some individuals choose to day trade or swing trade DFI tokens. They aim to capitalize on moves in the market that allow them to earn a profit. This can be lucrative, but it’s incredibly risky.

Where To Buy DeFiChain (DFI)

DeFiChain (DFI) has garnered support and investment in recent months because it is a project that aims to enhance the functionality of Bitcoin and provide it was more versatility.

DeFiChain (DFI) is available for purchase on most centralized cryptocurrency exchanges. However, you must first deposit currency into an exchange before you can buy DFI tokens on a centralized exchange. Your DFI digital wallet on the exchange will then be credited with XDFI tokens.

You can purchase, trade, and store tokens at the crypto exchanges listed below:

1. Binance (US Customers use Binance.US)
2. Gate.io
3. Coinbase
4. KuCoin
5. Bitfinex

Users must be mindful of the dangers before acquiring any tokens on a centralized exchange. When a user keeps tokens on an exchange, it practically means that their private keys are no longer theirs, since their tokens might be lost if the exchange is hacked.

Most people keep their tokens in a digital or hardware wallet. There are many DFI token wallets available on the market. Probably the most popular and reliable digital wallet is MetaMask.

 

FAQs About DeFiChain (DFI)

How long has DeFiChain (DFI) existed?

DeFiChain is a blockchain project that has been around for several years now. DFI has quickly grown to become a popularly traded cryptocurrency, and the project continues to garner mass adoption.

As of November 2019, the DeFiChain Foundation is the sole owner of all DeFiChain (DFI) copyrights. Developing new alliances, providing guidance on information system development for partners, and supervising DFI funding are all tasks assigned to the organization.

What’s controversial about DeFiChain (DFI)?

The decentralized finance sector is incredibly appealing to both retail and institutional investors. The sector is flourishing and new developments are taking place constantly – however, the sector is also vulnerable to exploits. Many of these exploits have cost users millions of dollars in recent years.

Individuals should always evaluate both accurate and rational information while investigating projects. Before investing money in any cryptocurrency project, you should gain as much knowledge as possible.

Let’s take a look at the biggest controversy surrounding DeFiChain (DFi).

• Built on Bitcoin blockchain – Although most individuals are only concerned about the DeFiChain price, it’s also important to consider improvement proposals that might have a positive effect on the price. The DeFiChain project is built on the Bitcoin blockchain, which can be seen as both a blessing and a curse.

  It’s a blessing because the Bitcoin blockchain is the most trusted and credible blockchain in the crypto world. However, the majority of DeFi lives on the Ethereum network, which poses a significant risk to the success of DeFiChain. The project will need to garner more ecosystem growth and investment to ensure it stands a fighting chance.

  There are various value proponents of the project, including decentralized stocks. But users are encouraged to do their own research before investing in the project.

How many DeFiChain (DFI) tokens are there?

At the time of writing, DeFiChain (DFI) has a circulating supply of 510,738,160.85 DFI (43% of the total supply).

The total supply of DeFiChain (DFI) is 784,881,510.

The max supply of DeFiChain (DFI) is 1,200,000,000.

Can DeFiChain (DFI) be mined?

DeFiChain (DFI) can’t be mined. However, users can use their fiat currency to purchase DFI tokens and utilize various DeFi apps that will earn them rewards. The protocol is especially well-known for its high APY rates.

The platform leverages advanced blockchain technology to solve more complex transactions in less time. It also offers users a host of other crypto assets, aside from DFI, that they can earn rewards on. The platform has grown in popularity because it is pioneering the growth of the Bitcoin ecosystem.

What is the market cap of DeFiChain (DFI)?

The market cap of DeFiChain (DFI) is the total amount of coins in circulation multiplied by the current DFI price.

DeFiChain (DFI) Market Cap = 510,738,160.85 DFI x $1.12 = $618 million (63rd largest market cap).

The market cap fluctuates according to circulating supply and market price.

 

Biggest Competitors Of DeFiChain (DFI)

The decentralized finance sector is growing exponentially. There are a number of competitors in the space that have amassed huge global communities and garnered significant investments.

The biggest competitors of DeFiChain (DFI) are:

• Uniswap (DEX)
• AAVE (Lending Protocol)
• Pancakeswap (DEX)

 

What Are The Future Plans For DeFiChain (DFI)?

DeFiChain will continue to grow its ecosystem by building valuable products that attract investment and adoption. The project has performed significantly well since it was launched because it offers users a variety of unique digital DeFi products.

 

Pros And Cons Of DeFiChain (DFI)

Pros

• DeFi on Bitcoin blockchain – DeFiChain has given the Bitcoin blockchain extended functionality by introducing valuable DeFi apps.
• Growing TVL – At its height, the DeFiChain TVL (total value locked) was $2 billion. This is considerably larger than most competitors.

Cons

• Competition – There are several competitors in the DeFi sector and DeFiChain will need to outperform its competitors if it wants to dominate the crypto market.

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