The decentralized finance (defi) ecosystem has become a multi-billion dollar industry and quite a bit of the popularity is stemming from China. While a number of defi projects from the West like Uniswap, Compound, and Makerdao are popular in the country, China is also creating its own landscape of defi platforms and applications.
At the time of publication, the recorded total value locked (TVL) in defi is hovering around $10.8 billion. Uniswap captures the market dominance according to the web portal defipulse.com, as the trading protocol commands over 20% of the market.
On October 1, James Gillingham the founder of Finxflo explained how China is developing its own defi ecosystem. Gillingham told Forkast News that he thinks China might be allowing the creation of its own defi space, in order to ultimately curb capital controls. The defi ecosystem in China has grown exponential, after the Chinese government banned initial coin offerings (ICOs) in 2017.
Another report this year that combs through the swelling defi sector in the country notes that “a large number of defi projects have gone viral in China.” Projects that have seen virality in 2020 include Loopring, Kyber Network, Uniswap, Compound, and Makerdao. However, despite these projects seeing lots of attention from China, the country is seeing a lot of its own defi development.
Stats from the Conflux Network show China is also seeing all kinds of defi applications tending to patrons living in the country.
The Conflux study report notes defi wallets like Bitpie, Debank, Cobo, Mykey are now integrated with Chinese decentralized applications (dapps). Non-fungible tokens (NFTs) are popular collectibles in China with NFTs such as Dappbirds, Hyperdragons, and Fishchain.
“Although the Chinese defi market is still in its infancy, recent waves of adoption, dapps, and capital from the region are slowly capturing a significant market share of the defi ecosystem,” the Conflux report highlights.
Stablecoins are also huge in China and while tether (USDT) dominates in the region, there’s a synthetic USD from Dforce and HUSD. There’s also Bitcny and Qcash as well representing two forms of synthetic CNY. In the borrowing and lending field, there’s platforms like Infinity, Kava Labs, Force Protocol, and Dforce.
Gillingham expects China to continue making “moves with this new decentralized finance approach.” The founder of Finxflo also expects the Chinese government to get involved in the defi ecosystem.
Defi has also seen significant growth since China started discussing approving licensed blockchain firms. In January 2020, over 33,000 companies registered in China with the intent of providing a blockchain service.
What do you think about the growing defi space in China? Let us know in the comments section below.
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