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Decentralised finance has come a long way, but starting to show it's limits.
Today nearly 93% of stablecoin generate yield below 5%. While that might seem like a small detail, it actually reveals a deeper issue within the system.
For long time, defi growth was driven by yield farming, leaverage and speculation. Users earned rewards by the shifting the liquidity, chasing higher returns.
In simple terms, defi has been operating in an echo chamber.
To truly scale into a trillion dollar financial system, defi needs to expand beyond crypto native activities. It needs to connect with real world economic demand.
Now a major shift is underway. Moving from crypto based leverage to onchain private credit. This new model focuses on linking stablecoins with real world use cases.
This creates a more sustainable form of yield, based on actual income rather than temporary incentives. Where instead of unpredictable, hype driven returns users can more sustainable form of yield.
Form my perspective, this shift is necessary. If you got my message study further documentation here @RialoHQ
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