Beta Finance asserts that the excessive price volatility of cryptocurrencies raises instability and causes many harms to the institutions and individual users if they adopt ‘DeFi’ for the long term. On 8th July, the platform introduced the protocol through a blog post stating that liquidations, panic selling, and excessive leverage are damaging factors for the ecosystem of ‘DeFi’. It further mentioned that the need to develop an opposite neutralizing force for meeting the volatility was felt by the platform to assist in a fruitful adoption of ‘DeFi’ for the future time.
It has been claimed by Beta Finance that it is the earliest market protocol for lending and borrowing money along with shorting any of the crypto assets without permission. It is the initial incubated venture by Alpha Launchpad (the incubator division of digital finance within Alpha Finance Lab).
The shorting process of the ‘DeFi’ assets is complex that includes shorting and borrowing of a token, administrating the positions, swapping the token for the other token like a ‘Stablecoin’, as well as supplying collateral.
A dashboard will be provided by the firm Beta finance to make the process convenient for the consumers. The demand from them comprises supplying collateral, deciding the value of the asset selected to get short, and the confirmation of the transaction. The firm explained that Beta Finance aims at achieving its goal of bringing advancement to the infrastructure of digital finance and broadening the circle of its adoption through delivering short tooling to facilitate the consumers by increasing the market stability and constructing new financial markets.
It has been promised by the protocol that it will grant yields up to 1,000% for certain tokens; however, the particular details about those tokens have not been given by the platform. Additionally, no authentic launch date has been revealed, and no native token has been specified, although there is a possibility of at least one.
The stability in ‘DeFi’ TVL
Despite a decline in the crypto market this week, the stability of digital finance protocols has remained intact. However, a contraction of 6% in the overall market cap has been witnessed since the 5th of July because nearly $90B has left the crypto space. Aave is still seen as leading the market having $8.3B from the total lockup, succeeded by Curve Finance and Uniswap.