2020 was – and is still- a crucial year for decentralized finance. Recently, the market experienced consecutive all-time highs, which includes an astonishing $12 billion+ in Total Value Locked (TVL).
This year was also marked by food coins, “fork” protocols, vampire attacks, and massive yield farming. Nonetheless, as we approach the end of the year, an interesting question appears within the debate: what is next for DeFi?
Undoubtedly, DeFi is a profitable business but is not everyone that can or wants to interact with tens of different protocols to find the best strategy for maximized yield. Also, DeFi’s fast-paced approach makes it difficult for non-enthusiasts to stay upgraded with what is happening in the scene.
As DeFi trading strategies are growing more and more complex, Vesper wants to make things simple and accessible. The yet-to-launch platform aims to provide a user-friendly gateway for investors, taking away complexities to broaden the base of who can use DeFi.
What Is Wrong with DeFi?
The idea behind a decentralized financial system is to have an alternative environment where individuals can buy, sell, trade, invest, bet, save and perform other financial activities within a trustless, censorship-free, and privacy-oriented ecosystem.
However, decentralized systems also have their share of issues. Four main problems affect DeFi and preclude it from reaching mass adoption:
- Security.
- Low liquidity.
- Lack of interoperability.
- Complexity.
Smart contract technology is much better than centralized systems. However, it is not perfect, as it is plain to see by events such as DAO Hack and SushiSwap’s code bugs. In this sense, code audits are crucial to secure any DeFi protocol, application or whatever may be built on top of the blockchain.
Low liquidity also haunts transactions within decentralized finance. It is impossible to deny that DeFi has come a long way since its first days, where it was hard to process a simple transaction due to rock-bottom levels of liquidity.
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Nowadays, liquidity pools became a hit, and everybody is staking coins everywhere to obtain some type of return. Nonetheless, it is impossible to compare the liquidity of DeFi with its traditional finance counterparties, which precludes and delays DeFi’s adoption from average users.
Also, DeFi is mostly built on top of Ethereum. While this blockchain recently launched a second layer and other projects such as Polkadot are bringing new solutions to the table, we cannot say that interoperability is strength in DeFi.
This issue becomes even more evident when people need to interact with a gazillion protocols within a single strategy: DeFi is still too complex for the average joe to understand.
It is evident that finance is not everyone’s favorite subject, but sometimes the blockchain jargon is too much for an everyday dude to handle.
In this sense, Vesper aims to provide a platform where everyone can come and start to experience DeFi as an everyday thing, free of all unnecessary complexities.
What is Vesper?
The idea behind Vesper is to deliver an easy-to-use platform where users can achieve their crypto-finance objectives. The system engine is powered by its native Vesper (VSPR) tokens, which are responsible for providing the fuel for the building and expansion of Vesper’s ecosystem.
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The purpose is to take away the complexities associated with yield farming, including:
- The necessity to interact with several protocols.
- Costs with transaction fees and gas, in general.
- Constant research for different strategies and new upgrades.
In layman’s terms, the platform entails a handful of steps instead of a dozen to facilitate decentralized trading.
According to their official Twitter account, the team believes that “DeFi products should be simple to use, launch with audited code, and strike the ideal balance between professionalism and community dynamism”.
So far, the platform’s code has been audited by CoInspect and CertiK.
Automated DeFi Investments
Vesper’s first products are the so-called “Holding Pools”. The idea is simple: the user selects a said asset and deposits it within the platform.
Once deposited, the assets are pooled and automatically deployed to other DeFi protocols based on the user’s risk tolerance and preferred strategy.
In other words, users simply need to deposit the assets and the pools will take care of the rest autonomously, based on a pre-conceived strategy that varies according to the user’s option.
Plus, Vesper wants to build a mechanism where investors earn interest in their chosen asset. For instance, an investor that deposits ETH will earn interest in ETH.
Native Token
Also, Vesper users will be rewarded with native Vesper (VSPR) tokens. The token forms the core of the project’s governance, participation, incentives, and other parameters.
Further reading: What are the main benefits of DeFi?
Users can earn VSPR tokens by performing different activities. such as staking in the vVSPR governance pool, participating in Holding Pools, and providing liquidity to certain VSPR trading pairs.
The platform initially promises pools for ETH, WBTC, and USDC, with more pools and strategies being added over time. Plus, they want to reward developers who create profitable strategies adopted by the whole community.
Who Is Behind the Idea?
One of the company’s co-founders is Jeff Garzik, a widely-known developer in the crypto industry. Garzik has been at the core of the crypto industry since its inception, going back to Satoshi’s whitepaper in 2009.
He spent five years as a Bitcoin core developer, also serving on the advisory boards of projects like BitFury, BitPay, Netki, and WayPaver Labs.
Currently, Garzik serves as CEO/CTO of Bloq, a company he also co-founded. Bloq is a leading blockchain technology company that focuses on building solutions and infrastructure for a multi-blockchain future.
Conclusion
Vesper is a yet-to-launch platform focused on simplifying DeFi for the average user. This blockchain-based structure offers a solution to investors who cannot or do not want to interact with tens of decentralized protocols but have the desire to invest in DeFi.
According to co-founder Jeff Garzik, the idea can be summarized by “the simplicity, the passive income, and the kind of ‘set it and forget it’ type of product.”
The mechanism is simple: users deposit a said asset within the platform. Once deposited, the assets are pooled and automatically allocated to different strategies, depending on the strategy chosen by the investor.
Initially, Vesper will enable users to put assets into pools for ETH, WBTC, and USDC.