Elrond and Reef Finance are working together to offer connectivity in the DeFi ecosystem at rock bottom prices.
Until now, DeFi has been synonymous with Ethereum, which has led to high transaction costs. While these high costs aren’t a big deal for wealthy traders, DeFi was also designed to allow people to access financial services at low rates.
Reef Finance is a cross-chain DeFi platform, and now, its users will be able to access Elrond directly, which is expected to enhance liquidity for both platforms.
Elrond and Reef Finance Make Sense Together
DeFi has loads of potential, but much like the early days of Bitcoin, the infrastructure behind the idea is still being developed. There will no doubt be advances that make DeFi a more accessible, usable system, and this partnership is movement in a positive direction.
Elrond’s CEO, Beniamin Mincu, stated:
“Assets that become globally available regardless of the originating platform will add up to a massive liquidity pool. The resulting unprecedented flow of value will amplify DeFi benefits for everyone. Actors like Reef Finance have the opportunity to enable that, so we are happy to interoperate towards our common vision.”
One of the best parts about DeFi is that many different blockchains can be pooled to enhance network-wide liquidity, and drive down borrowing costs for users. The net result is a win-win for both lenders and borrowers, as both parties benefit from a market-based interest rate-setting mechanism.
A Wider Use Case for Elrond
With this partnership, Reef Finance users will be able to access Elrond, and its eGold token directly from the Reef Finance interface. Other blockchains can be used in concert with Elrond, which features lightning-fast transaction speeds, and very low costs.
Denko Mancheski, the CEO of Reef Finance, commented,
“The technical capabilities of the Elrond Network combine with attractive eGold tokenomics and a highly committed userbase to create a DeFi ecosystem with very high potential. We are excited to integrate it into our platform and collaborate towards establishing a global DeFi landscape that anyone finds easy to interact with.”
Indeed, while Elrond isn’t as widely used as Ethereum, it is much faster to use, and won’t be plagued by the high gas fees that have priced many transactions out of the Ethereum ecosystem. While Ethereum is working on a PoS upgrade to address these drawbacks, Elrond’s blockchain is ready to use today.
Better Performance, Wider Adoption
There have been loads of DeFi applications that have hit the market over the past two years, and this shows how much interest there is on both the dev side of the ecosystem and also how willing investors are to support new ideas.
Unfortunately, DeFi has become a victim of its own success, and in order for the sector to grow, new tools like Elrond are needed. Investors aren’t going to pay fees in the DeFi ecosystem that are higher than the existing banking system, which is common today with Ethereum.
There is certainly a demand for assets in the Reef ecosystem. Recently, Reef offered the Litentry Bond, and it attracted more than $4 million USD worth of investment in only a few hour’s time.
This demonstrates the viability of Reef’s investor base, as well as the hunger for yield in a world where more and more debt is approaching a yield level of zero. With $REEF staking, investors can gain returns from the free markets, which are still delivering returns that are in-line with monetary reality.