Launch A Defi Protocol With Our Defi Smart Contract Development
A Brief Overview Of Decentralized Finance
Decentralized finance, also known as an open finance movement, has turned a lot of heads in the past few months, and rightfully so. The protocols and applications that DeFi has birthed have completely changed the landscape of all financial services. Services that were once centralized or rather under the control of third parties faced some serious challenges such as security breaches, inaccessibility of certain services to some populations, room for human error and fraud, and limited online services. Decentralized finance changed all of that. How?
With the help of blockchain technology, all of these various services like peer-to-peer transactions, insurances, loans, asset trading, asset tokenization, exchanges, etc are completely executed automatically. All of these services and more can be made available to anyone with just a mobile phone and internet connectivity. Through DeFi protocols and applications called dApps, these functions are achieved. This is made possible by Smart Contracts.
Ever since then, several businesspersons and entrepreneurs have shown interest in this concept, and are launching their own DeFi Applications. To run those applications smoothly, DeFi Smart Contracts is a must, and we at Cryptocurrency Exchange Script are the best at developing Smart Contracts to support your business. Read on to gain more insight into the phenomenon that are Smart Contracts.
Smart Contracts – The Lifeblood Of Defi Protocols
Smart Contracts contain operations written in code that work on the blockchain network, the Ethereum one to be precise. These programmed instructions are carried out when certain predetermined conditions are met. These contracts cancel out the need for human interaction and resources completely in the financial sector. These pre-set conditions are determined by those using the smart contract for their varied purposes.
Let’s take, for example, the simple analogy of the vending machine. If you put in $3 for a pack of chips, the machine will get it to you. If you drop in just $2, the machine will not be able to give you the chips. It is programmed in such a way that only if you deposit $3 or more, the machine can give you the bag of chips. The same concept applies to other DeFi services like banking, loans, exchanging coins, buying, and selling assets online.
Smart Contracts work on this basic principle – ‘if this happens, then do this’. But when you think about it, don’t some services already work on this premise? Credit and debit cards work this way. If someone wants to send $150 to a friend, and if the person has enough funds in his account, then the money is sent. If not, the funds are not transferred. But here’s where smart contracts show their supremacy.
There has to be a bank behind that credit card transaction to take place. With Smart contracts, that control falls to the blockchain. If the appropriate funds are available in the E-wallet, the money is transferred. There is absolutely no reliance on anyone. What’s more, these contracts, unlike traditional agreements, can be made with anyone. The blockchain will keep a record of this data.
Various Scenarios Where Smart Contracts Show Their Convenience
The entire DeFi platform runs on the principles of Smart Contracts. Without it, Decentralized services will have no value. They power popular DeFi protocols like Compound, Aave, Uniswap, among others. Let’s briefly delve into these protocols.
- Compound – a popular DeFi protocol, Compound lets its users take loans and lend assets by locking in their crypto assets with the protocol. The interest rates that are received and paid depending on the supply and demand of the crypto assets.
- MakerDao – Running on Ethereum based smart contracts, the Dai Stablecoin is widely used in the Defi network. Users using the platform usually borrow Dai by depositing ETH. Dai is pegged to the US dollar.
- Synthetix – Popularly known as a derivatives liquidity protocol, this platform allows users to mint both crypto assets and real-world assets.
- Uniswap – This DEX protocol allows traders to swap their ERC-20 tokens, hosted on the Ethereum Blockchain.
Other Organizations And Corporations That Make Use Of Smart Contracts
A Few Examples Are,
- Slock.It is an application that is being used by businesses to automate sharing, payments, and rentals. Slock.It has recently partnered with Share&Charge where the smart contracts technology is used to pay for renting electric vehicle charging stations.
- Ubisoft, the famous video game developer is now using blockchain technology wherein specifically designed smart contracts that allow users to transfer, claim and own rare Non-Fungible Tokens (NFTs)
- The Swedish government has recently employed smart contracts built on a blockchain-based land registry for proving land ownership.
- Etherparty is a start-up that allows users who have no prior knowledge of coding and programming, to build their own smart contracts.
Advantages And Benefits That Smart Contracts Contribute To The Defi Network
- Security – Smart Contracts offer a very secure environment that prevents alteration of data recorded. Once the buyer and seller, or those using the contract decide on the agreement, it cannot be tampered with. These contracts are also audited regularly so that their standards are maintained.
- Transparency – Everyone on the blockchain network will be able to view the smart contract and know what it’s about. But private information will not be apparent. Certain codes are in place instead of sensitive information.
- Highly Accurate – The smart contracts are written in code. It is in fact written using the Solidity programming language so there is absolutely no room for errors. Also since there is no human involvement, the chances of miscalculation and inaccuracy are ruled out.
- Autonomous – the smart contract does not need to be operated or controlled by anyone. It automatically executes the code that is programmed.
- Digitization – unlike traditional contracts, these agreements, as mentioned earlier, are digitized lines of code. Since they exist online, they save a lot of resources and time.
- Absence Of Disputes – with centralized transactions, there is an increased likelihood of disputes arising between parties. This may incur huge losses for either party. Since smart contracts are irreversible, and in the absence of intermediaries, these disputes are avoided.
- Immutability – Smart Contracts are the epitome of the phrase ‘sticking to one’s word’. The immutable nature of these contracts will ensure agreements and transactions are carried out without delays.
- Third-Party free – As iterated earlier, smart contracts work independently without dependence on any human resources.
- Fees – since these contracts run on the blockchain network, separate fees do not need to be shelled out to third parties for initiating transactions.
- Speed – Manual functioning of financial services is now outmoded thanks to the automated nature of smart contracts that carry out actions in no time.
- Interconnectivity – Many smart contracts can be connected together to form complex arrangements that carry out several functions.
Smart Contracts are the lifeblood of all DeFi protocols and dApps and they provide a slew of advantages to these platforms. You, as an entrepreneur or a business owner, might run a DeFi protocol like Compound or Yearn.Finance. To run these applications with ease and dexterity, extensive smart contracts are necessary. It is a given that these applications basically run on smart contracts.
Discussed here are the extra benefits that smart contracts will offer your DeFi protocol business.
- They automate all financial services within these protocols
- These applications are globally accessible.
- Exchange of assets has never been this easier. Smart contracts quicken the process and eliminate transaction fees.
- The crypto assets are safely stored and there is no possibility of breaches.
- Smart contracts offer trust and safety when it comes to financial transactions.
Cryptocurrency Exchange Script Your Best Shot For Defi Smart Contract Development Services
So you’ve launched a business venture, a DeFi protocol like a cryptocurrency exchange, lending and borrowing platform, developing Stablecoins. Or you might be stepping into the ecosystem of Decentralized Finance and want to build and launch a DeFi protocol or dApps, you will need Smart Contracts built on the blockchain network to support all decentralized activities. For that, our DeFi smart contract development company is the right fit.
Everyone is now aware of the success the DeFi sector has faced and so have we. Therefore, our DeFi services are top-grade solutions that will ensure your DeFi project will witness high returns. All our developers and auditors use high-end technology stacks and are skilled in their trade. They use Solidity Programming language and provide end-to-end encryption for all Smart Contracts built. Our solutions always hit the brief and will provide automated execution of agreements that your DeFi protocol requires.
Moreover, our DeFi Smart Contract Development solutions are completely customizable and scalable, so as revenue comes flowing in, our products will enable the business to keep up. Our other services relating to DeFi smart contracts include smart contract auditing, reauditing, and optimization. We are also established in the development and launching of DeFi protocols and dApps. Get to know more about our services and how we can help you scale your DeFi business make profitable gains. Connect with us soon to know more.