What can DeFi do to get investors back? Cointelegraph sat down with Cake DeFi co-founder and CEO Julian Hosp to find out.
As a result, both new and seasoned crypto entrepreneurs are now faced with the task of reinventing the DeFi wheel to offer sustainable investment opportunities as well as taking proactive measures to instill trust among investors.
This was the case for companies like Celsius, Voyager, FTX and many others that imploded along with the market crash. Unfortunately, it took a fallout of this magnitude to clear out these bad actors. The string of bank collapses caused some people to lose confidence in TradFi and CeFi and to look for alternative ways to store and manage their wealth, such as DeFi. DeFi provides an alternative to CeFi by allowing individuals to access financial services and products without relying on traditional intermediaries, such as banks.
When it comes to generating rewards on crypto, investors definitely want a platform that offers yield percentages that are both reasonable and reliable. Since yield percentages differ on every crypto investment platform, investors must carefully look into how or where the yields are generated, and whether the percentages in their preferred platform fluctuate too often or are too high.
CT: Q1 2023 saw Euler Finance hacked in one of the biggest DeFi exploits, with its CEO saying this occurred despite conducting 10 audits over two years. How effective are audits when it comes to security? Can the DeFi ecosystem solely rely on audits?In the crypto space, companies have a unique opportunity to demonstrate their financial health and liabilities through proofs of reserves and blockchain transparency.
Another approach is to have as many multifactor authentications as possible, including automated checks, manual checks and more. Although not a foolproof method, MFA is an effective way to increase the security of cryptocurrency transactions and accounts. CT: How important are user interface and user experience for retaining customers? New investors can often be overwhelmed by the amount of information current UIs show.UI and UX are crucial elements of a successful product or application and have a significant impact on customer retention. A well-designed UI can make a product visually appealing and intuitive, while a positive UX can lead to satisfied customers who are more likely to use the product again and recommend it to others.
In the past, during the crypto bull run, it was all about hype. VCs would just crowd into different projects and throw money at them. This is actually what we are seeing today in theindustry. Whereas today in DeFi, VCs understand that this golden period is over and that they have to carefully look at other factors to determine which projects they should invest in.
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