DeFi is not an uncommon term in today’s financial system due to its increasing impacts on the financial market. Provides solutions to the limitations of traditional finance. It fosters an open and decentralized financial transaction that will not depend on intermediaries, such as banks, insurers, brokerage houses or stock exchanges. Instead, it allows the use of decentralized networks to provide services to users. Even though cryptocurrency allows decentralized transactions, it faces the same challenges that it has always avoided; intermediaries! So this prompted the emergence of DeFi liquidity funds.
We understand that some people are unfamiliar with DeFi, the liquidity pool, and how it works. This article will provide a simple guide to the liquidity pool and liquidity share token programs.
What factors determine DeFi’s liquidity pool?
The objective of DeFi is to guarantee open financing and exclude intermediaries from any type of transactions carried out and that includes; loans and insurance. Seeks to improve flexibility when buyers and sellers transact. However, liquidity has always been a major limitation for cryptocurrencies and blockchain. This sparked the emergence of the DeFi liquidity group.
DeFi’s liquidity pool is based on a ‘smart contract’ that allows buyers and sellers to execute transactions and determine prices to achieve equity. It is DeFi compatible making it convenient and efficient for users. The term “liquidity” refers to how easy it is to convert at the correct price. When it comes to cryptocurrencies, liquidity refers to how easy it is to sell and buy cryptocurrencies without resulting in a loss in value. The exchange value of the cryptocurrency increases when the liquidity rate is high and that is why the liquidity pool is known as the backbone of the cryptocurrency.
There are different factors that result in the increase and decrease of the liquidity pool rate. They include; the market, market makers and more investment.
Lack of broad market access and efficiency negatively impacts cryptocurrency liquidity and this, as a result, makes communication difficult. When the market is not efficient enough, it becomes difficult to transact between cryptocurrencies. To increase the liquidity rate, wallets should not be isolated only on local exchanges. The easier it is to access global exchanges, the higher the liquidity rates. Therefore, the market must be open so that people can trade different cryptocurrencies.
The main factor that determines the easy conversion of cryptocurrencies to cash is the market makers. They include; trading companies and buyers. However, it is not only commercial companies, but those that are able to use the infrastructures to their advantage to achieve a functioning market.
For a market to be liquid, there must be people willing to trade. When people continue to invest in the market and ensure that there are global exchanges when a transaction takes place, the liquidity pool increases. When there is money, people will want to trade without having to worry about the price being affected. Therefore, the liquidity pool will increase.
How can DeFi be applied?
Stablecoins make use of DeFi because they deal with assets that are not tied to cryptocurrency to avoid price fluctuations and include education or conducting transactions in conventional stores.
While there are different liquidity fund providers, Edgecoin it is known to be the only stable currency that is made specifically for universities around the world to accept decentralized payments of tuition fees. Therefore, it creates an open market and an open market system with gradecoin as its fluctuating currency DeFi. Some of the peculiar features of Edgecoin are fast transactions, less costs, it offers a secure global system.
Edgecoin has a liquidity gambling program with the motto “win while you learn”. That means when you bet Edgecoin you will get 34% Gradecoin. Gradecoin is Edgecoin’s government token and it has two tokens in total. Another benefit of the participation program is the high demand rate that facilitates price stabilization and access to the world’s first educational stablecoin. It is very easy to get started; all you need is your desktop, visit the website edgecoinpay.com and bet.
One of the benefits Edgecoin offers is an open payment system that allows institutions to conduct education-related transactions. This includes; payment of books, tuition and accommodation. Therefore, transactions have been simplified through a decentralized payment platform.
Edgecoin provides solutions to the traditional financial system by ensuring speed and also ensuring that people have access to educational infrastructure. The partnership with Dublin College of Advanced Studies (DCAS), which as of now accepts Edgecoin tokens as a form of payment, and more universities are lined up.
Apart from all these, Edgecoin allows you to get a grade coin, which is a coin in the DeFi market when you have an Edgecoin. All you have to do is head over to the edgecoinpay.com website and start wagering your EdgeCoin to receive 34% GradeCoin before decreasing the amount of GradeCoin you get for wagering.
Follow these simple steps:
-download the Brave or Chrome browser
-connect your wallet through Metamask
-choose the coins you would like to deposit and start betting within Edgecoin
-Get your W-Edge Coins in a row with your 34% GradeCoin at 0.20 located in your wallet that you created to deposit.
Image by asderknaster from Pixabay