Editor's Note: This article comes fromARPA Privacy Computing Protocol (ID: arpaofficial), reprinted by Odaily with authorization.
, reprinted by Odaily with authorization.
This makes DeFi one of the fastest-growing areas in the blockchain ecosystem, with an overall lock-up volume now exceeding $3 billion. Among the many business areas of DeFi, the three most eye-catching directions are stable currency, decentralized exchange and lending business. Among them, the development of DeFi lending business is particularly rapid.
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Questionnaire background
Most of the respondents (about 70%) are experienced users who have been exposed to cryptocurrency for 2 years or more, 23% are ordinary users for 1-2 years, and 7% are new users who have just been exposed to cryptocurrency for less than a year. This user survey takes into account different regions, age groups, occupations and genders, and is representative of the industry. We conducted data analysis on the survey results, and finally used it to understand and mine blockchain-related users' awareness of DeFi, potential needs and usage preferences, so as to guide the design of DeFi products, solve the needs of DeFi users, and promote the development of the DeFi industry. develop.
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executive Summary
Most of the interviewed groups are senior users of cryptocurrency, which cannot fully represent the behavior of novice users. Referring to the number of active addresses of Compound, Uniswap, Curve, etc., we estimate that the current number of DeFi users is around tens of thousands, which is only 1% penetration rate compared to the 5 million crypto trading users worldwide. What the industry needs at this stage is DeFi products that allow the public, not just big investors and giant whales, to participate.
The survey shows that the degree of DeFi awareness and hype far exceeds the actual participation of users. The single biggest demand for user participation is to obtain liquidity mining rewards, or excess interest income. The comprehensive rate of return must exceed 15% annualized before users can participate with motivation.
Yield farming/Liquidity mining, as an innovative incentive method, issues platform tokens through decentralized lending platforms and distributes them to deposit and loan users to subsidize capital income. It is an effective way to attract users early customer acquisition mechanism.
Among senior Chinese and foreign users, although decentralized wallets are very popular, they are still mainly used for transfer and storage, and only one-third of users use various DApps. The use of DeFi requires proficient use of wallets, resulting in long paths for users and high learning thresholds.
At present, DeFi is mainly concentrated in ERC-20 tokens, and the asset richness is relatively low, especially lacking the support of BTC collateral with security, good user experience, and low handling fees. At present, the emergence of WBTC and RenBTC is expected to open up new markets.
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Decentralized Wallet Usage
The survey data shows that decentralized wallets have a very high penetration rate among blockchain user groups at home and abroad, and the number of respondents using decentralized wallets at home and abroad has reached more than 90%. Among the reasons for using wallets, security and fast transfers are the main reasons, accounting for 76% of the total.
Among overseas respondents, 93% of overseas users use their wallets weekly or daily, and 40% of overseas users put more than half of their digital currency assets in their wallets. Among the domestic respondents, 66% of users use wallets every week or every day, and 30% of users put more than half of their digital currency assets in their wallets.
DeFi awareness and participation status
The survey data shows that overseas users generally have a high degree of awareness of the concept of DeFi and participation in products. As many as 97% have heard of the concept of DeFi, and as many as 78% of users who have bought DeFi concept currency.
In contrast, the proportion of respondents in China who have heard the concept of DeFi is slightly lower than that of overseas users, reaching 86%, and 58% of users who have ever purchased DeFi concept currency.
Among the interviewed groups, 75% of overseas users and 25% of domestic users use the centralized deposit and loan function in the past, and there is a big gap between the two sides. In comparison, the domestic interviewees’ awareness of DeFi and the acceptance of DeFi products have a lot of room for improvement compared with overseas.
DeFi user demands and learning threshold
We asked users at home and abroad about their expectations for using DeFi products. Survey data shows that users at home and abroad are more sensitive to the amount of handling fees for DeFi products, and generally expect transaction fees to be no higher than $2 (domestic 76% vs overseas 65%). At present, due to the congestion of the Ethereum network, the contract call fee is often 10-20 US dollars, which is much higher than the expectation of 2 US dollars, which prevents many small and medium-sized users from participating in DeFi.
Judging from the expected return on deposits, most overseas users (75%) and domestic users (74%) said that the combined annualized return needs to exceed 15% to be sufficiently attractive for them to use DeFi products. About half of the users at home and abroad expect an annualized return of more than 20%.
More than half (60%) of the overseas interviewees said that they have participated in liquidity mining. In contrast, only 22% of domestic users have participated in liquidity mining, and there is a lot of room for improvement. It’s worth noting that surveys show that most DeFi users deposit or participate in liquidity mining with an amount of $10,000 to $50,000.
Judging from the willingness to learn about DeFi products, 40% of domestic users expressed their willingness to spend at most one hour to learn and use a new DeFi product, and this proportion was about 56% among overseas survey groups. About 12% of Chinese users and 2% of overseas users are not willing to spend time learning to use DeFi at all.
Reasons to use and not use DeFi products
According to the survey data, 75% of overseas respondents use DeFi products.
This question is multiple-choice, and respondents can select multiple reasons for use/non-use. Among them, Yield Farming/Liquidity Mining is the main driving force, accounting for 74%, followed by considerable interest (29%), no KYC (27%), convenience (21%) and security (18%) ).
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The resistance to use is mainly due to the unattractive interest rate, accounting for 58%, followed by poor user experience (20%), worry about contract security, and not being able to access DApps or not having a wallet (17%).
Chinese users who have used DeFi products accounted for 25% of the total, and the driving forces were liquidity mining (58%), convenience (52%), considerable interest (42%), no need for KYC (34%), security ( 33%).
Therefore, if DeFi products want to increase their attractiveness, higher interest rates and trustworthy security are the top priorities.
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Prospects for Open Finance
From a macro point of view, blockchain is a paradigm replacement for traditional finance. The essence of the blockchain is decentralized, so no matter how long it takes in the future, there will be two attributes: first, the attribute of speculation; second, the upgrade of the financial field. From the perspective of DeFi, the bigger market in the future will be the central bank’s digital currency CBDC. The emergence of the official digital currency will drive a lot of assets on the chain. At that time, DeFi will be able to enter the public’s cognitive field and be known by more people. .
In the next year or two, the development of DeFi will be greater than the public chain it carries. The stable currency that DeFi relies on will develop to be bigger than Bitcoin because it can continuously bring funds from outside the circle into the circle.
In the process of paradigm change, there will always be huge opportunities, from the Internet to the mobile Internet, from WeChat, Instagram to Douyin, which proves this. As a decentralized settlement system, blockchain is destined to change the financial industry from its birth. One day, DeFi will step out of the small circle of cryptocurrency and become a leader in open finance. As a pioneer, Bitcoin has created a decentralized trading medium. As an ancient financial tool, lending will become the cornerstone of open finance with the help of DeFi. From the rise of USDT, USDC, DAI and other stablecoins in the past two years, it can be seen that the scale of stablecoins will be the basic disk of open finance and provide capital supply for DeFi.
