DeFiChain is a decentralized blockchain platform dedicated to enabling fast, intelligent and transparent decentralized financial services. The project was launched in the fall of 2019 with the aim of offering financial services that commercial banks typically provide (borrowing, lending, investing, keeping funds). Unlike most of the other DeFi projects that are built on the Ethereum network, DeFiChain is built on bitcoin (as a software fork) and is anchored to the bitcoin blockchain (via merkle root) every few minutes for maximum security.
DeFiChain approaches decentralized finance as a specific and critical segment of the blockchain community. DeFiChain is a dedicated blockchain that is optimized specifically for DeFi applications. DeFiChain is intentionally non-Turing-Complete and does not support any function, other than those needed for Decentralized Finance, resulting in a blockchain that provides higher throughput and better functionality specifically for dApps related to finance. The advantage of a non-Turing complete command set is that there is a much lower potential for coding errors of the type that have plagued Ethereum smart contracts such as with the DAO hack or the locked funds with Parity. This ensures that only financial transactions are possible, instead of having games and casinos clogging the ecosystem and causing high transaction fees.
$DFI is the native token of the DeFiChain platform. The token is utilized both as payment for transaction fees and as a governance tool (i.e., token holders can vote on ecosystem improvements). On top of this, $DFI can be used as collateral to borrow other crypto assets. By paying 100 $DFI, users can create new tokens. After every coin has been minted, stakers will be rewarded with transaction fees.
DFI has a capped supply of 1.2 billion coins. 49% of the total supply was transferred to the DeFiChain Fund and the remaining 51% has been issued to masternode holders (over time).
The co-founders of DeFiChain are Dr. Julian Hosp and U-Zyn Chua. The DeFiChain platform believes that it's possible for crypto users to easily complete financial transactions in a manner that's fast, secure and decentralized. DeFiChain’s mainnet went live on May 11, 2020. As a related project, Julian and U-Zyn also founded Cake DeFi – a highly transparent one-stop solution for lending and staking crypto. The company is also launching USD lending, and a fiat onramp for easy credit card to crypto conversions.
The network operates on a hybrid Proof of Stake / Proof of Work consensus mechanism, and leverages Bitcoin’s security by anchoring to the Bitcoin blockchain (via Merkle root) every few blocks. Being non-Turing complete, DeFi transactions on DeFiChain flow quickly and smoothly at low gas rates, and have reduced risk of smart contract errors.
DeFiChain currently supports tokenized BTC, ETH, USDT, DOGE, LTC, and BCH on the DeFiChain DEX, which enables liquidity mining (yield farming) for these coins.
DeFiChain is designed for investors in the cryptocurrency market who are looking to make their cryptocurrency work just like any other form of capital, such that they can ensure a return on investment in any market. DeFi provides full functionality for this specific segment of the DLT community, sacrificing other types of functionality for simplicity, rapid throughput, and security.
The function set includes among others:
- Decentralized lending
- Decentralized wrapping of tokens
- Decentralized Pricing oracles
- Decentralized exchanges
- Transferable debts and receivables
- Decentralized Non-collateralized debt
- Asset tokenization
- Distribution of Dividends
- DFI is used for fee payment for all transactions and smart contracts on DeFiChain.
- Fee payment for decentralized exchange transactions
- Fee payment for token transfers
- Fees payment for DeFi activities:
- DEX fees
- XCX fees
- Lending loan interests payment
- etc.
- Collateral for borrowing of other cryptoassets on DeFiChain.
- 20,000 DFI is required to run a staking node for DeFiChain.
- 1,000 DFI is required to create a DCT. This is refundable upon destruction of the DCT.
- 10 DFI is required to submit a Community Fund Proposal. This is non-refundable.
- 50 DFI for submitting a Vote of Confidence. Also non-refundable. Both are to be paid to the burn address 8defichainBurnAddressXXXXXXXdRQkSm
Of the roughly 1.2 billion $DFI coins 49% was issued to the DeFiChain Foundation at the start. The rest will be issued to Masternode holders over time. Of the 49% initially issued $DFI coins, 49% will be kept by the DeFiChain Foundation. The rest may be distributed to accredited investors, large funds and institutions, collectively known as external partners, to fund the initial development of DeFiChain. In order to decentralize the holdings of DFIs as much as possible the DeFiChain Foundation may not keep more than 49% of all initially issued tokens. The use of potential proceedings of the tokens will be decided by the DeFiChain Foundation board but will exclusively be directed towards the adoption and development of DeFiChain.
The project didn’t participate in ICO or initial exchange offering (IEO) events and the DeFiChain team did not conduct any sales rounds.
