Neo founder, Da Hongfei, acknowledges the Neo ecosystem is missing essential decentralized finance (DeFi) components and plans to pursue their development. Da shared his insights in an interview with CoinTelegraph China at the Great Bay Area Blockchain Week event in Shenzhen, China.
Much like the initial coin offering (ICO) mania of 2017, Da believes current trends in the space DeFi are highly speculative and harbor a fear of missing out (FOMO) from retail investors. However, just as the ICO model established a new methodology for companies to raise funds, Da believes DeFi is also altering traditional industry. He said:
There are many speculative aspects of ICO, but there [were] also very positive new paradigms in the context of [the] ICO. I think that’s also very similar with DeFi. Although there are speculative factors in DeFi, it also demonstrates a new way to build financial products, integrated like a lego style financial product. My understanding of DeFi is that it’s highly speculative, but has a more symbolic meaning for the financial industry.
After an inquiry about Neo’s current involvement in DeFi, Da pointed toward two successful non-custodial exchanges within the ecosystem – Nash and Switcheo – noting they were early players in the DeFi industry. However, Da acknowledged that Neo has several “missing pieces” when it comes to DeFi, citing a reliable stablecoin, automated market makers (AMM), and synthetic assets (e.g., options, futures, or swaps) as examples. Da noted, “For the next six months or so, we will be attacking those factors.”
Further, Da pointed out that blockchain is still not ready for the center stage, and that Neo has time to catch up with the DeFi trend. He noted:
I think we’re still years away from mass adoption. If you look at those DeFi applications on Ethereum, their combined [daily active users] is around 8,000. That’s very small compared to any internet company. So, we’re still quite early.
The full interview can be found below: