With the replacement of traditional finance methods to decentralized finance (DeFi) every year, DeFi has turned into a vibrant industry that can offer new and different services to the user in addition to crypto money services.

The Stock API, Forex API, Crypto API and many other similar decentralized applications (dApps) created by the developers are built on the Ethereum blockchain. Due to the diversification and increase in the number of DeFi services and applications, this sudden growth on the blockchain has led to transaction delays and high fees. Therefore, it has become a necessity to find alternative solutions for users.

Many developers have started to build their applications on Polkadot as an alternative to the Ethereum blockchain. Polkadot works as a blockchain platform that connects the various blockchains currently in existence, making them interoperable. Thanks to these features, it has become a hope for the challenges faced by developers and users.

So why does this development keep DeFi developers hopeful?

 

GREAT TRACTION

Although Polkadot launched its mainnet in mid-2020, it received a lot of attention from users and developers. In return for this interest, it is already among the top five cryptocurrencies. The market value is over $ 17 billion.

The potential of the Polkadot blockchain, high-level capabilities and numerous DeFi solutions have been accepted by approximately 350 projects on the platform.

 

There are many DeFi platforms that Polkadot supports its development:

CLOVER

Clover is the new parachain and all-in-one open DeFi platform that allows developers to easily deploy their dApps on Polkadot while also taking advantage of DeFi features previously only available in Ethereum.

Supported by the leading exchange platform Bithumb Global, Clover Finance offers a modular framework to streamline developers' implementation processes, greatly reducing the barrier to building on the platform.

 

SEASCAPE

Seascape is a recently announced Substrate-based game platform that makes it easy for developers to launch their own blockchain-powered games in addition to taking advantage of some of Seascape's unique features.

It has a unique reward token known as Crowns to reward those who interact with the Seascape ecosystem, as well as incorporating powerful blockchain and DeFi elements such as NFTs, CDPs, and yield farm into gaming applications.

 

ACALA

lthough Acala is well known for offering its first native stablecoin (aUSD) in the Polkadot ecosystem, the team behind the project insists on not being pigeonholed. Acala supports the liquidity foundation on multiple blockchains inside or outside of Polkadot in addition to taking on the mission of being a hub for defi through its stablecoin platform.

 

While Acala is still in its early development stage, the project will provide more functionality than most stablecoins when officially on the mainnet. In addition to these features, the platform will provide tools for borrowing, lending, interest earning and governance voting power.

 

Meanwhile, Acala's "weird" counterpart, Karura, is heading for a launch on the Kusama canary network. Experts are extremely hopeful that Acala will officially launch on Polkadot mainnet in 2021.

 

WHY IT’S SO POPULAR

Polkadot is built on a new blockchain framework known as Substrate, which is widely thought to be easy to build on, thanks to dozens of combinable modules that blockchain architects can use to build their solutions.

It uses a combination of relay chain (Polkadot's main chain), parachutes, and bridges to connect the blockchain ecosystem to a compatible, interoperable unit.

Substrate, developed by Parity Labs, is fully open source allowing developers to build on it. It also enables builders to create their decentralized apps for Polkadot blockchain even with limited budgets.

 

The substrate combines a number of features that make Polkadot an ideal platform for building DeFi solutions, including:

Speed: Polkadot's block time is only six seconds, and most transactions are considered finished in less than a minute. This is crucial for building speed-critical applications such as decentralized exchange (DEX) platforms.

Scalability: Polkadot can currently handle more than 1,000 transactions per second (tps) compared to just ~ 25 tps for Ethereum at its peak under ideal conditions. However, Polkadot founder Gavin Wood is hopeful that this could eventually reach up to 1 million tps with the use of shredding and optimized parachutes.

 

Interoperability: The biggest advantage of Polkadot is its interoperability. This means that applications built on Polkadot and its parachains can easily interact with those on other blockchains (including Ethereum). Creating the first interoperable DeFi ecosystem is the main goal.

 

Taken together, these features and the groundbreaking pace of Polkadot's development position it not only to DeFi, but potentially as a potential launch pad for the future of the crypto industry as a whole.