Bitcoin
Invented in 2009, starting with Bitcoin, brings distributed ledger/blockchain --> peer-to-peer transfer (P2P) & non-sovereign digital asset (non-sovereign)
Ethereum
Bitcoin - Script language => command restrictions Ethereum, launched in 2015, Solidity language, quickly became a popular smart contract platform because it met the criteria.
Maker
One of the oldest projects on Ethereum is Maker – a protocol for minting the first decentralized stablecoin, DAI. At first, DAI was minted only with ETH as collateral, however the number of accepted collateral expanded in late 2019.
EtherDelta decentralized exchange
Appearing since 2017, EtherDelta allows the exchange of tokens of the ERC20 standard through an order-book mechanism similar to centralized exchanges. Little known due to poor and complicated UX, users mainly use EtherDelta to trade tokens after ICO but not yet listed on centralized exchanges. Hackers gained access to EtherDelta's interface and redirected them to a phishing site – an estimated $800,000 was stolen.
ICO - Initial coin offering
ICO, crowdfunding. Issuing Tokens in exchange for ETH => creating many ghost projects One of the major breakthroughs at the time was the idea of users interacting with smart contracts containing other users' assets, rather than p2p peer-to-peer interaction. This idea created a new “user-to-contract” model, shaping the future of DeFi. After the ICO trend ended, DeFi went through a rather quiet time.
Uniswap
Launched on November 2, 2018, in contrast to EtherDelta, Uniswap is built on completely new concepts such as “liquidity provider”, “automate market maker”. Leverage the previous “user-to-contract” model.
Back Thursday
On March 12, 2020, ETH price plummeted more than 30% in less than 24 hours amid the outbreak of the Corona pandemic. GAS fees increased to 200 gwei as many users tried to deposit more of their collateral to secure various loans or were trying to escape from the bloodbath. Maker is the most affected. => add MKR tokens to compensate.
Defi timeline
May 2020, Compound proposes Liquidity Mining. DeFi users are rewarded for lending and borrowing on Compound. The reward is COMP tokens, resulting in significantly increased lending and borrowing liquidity. This also allows the growth of “Yield Farming” as users can use tokens between protocols to optimize profits.
New governance model (DAO), users with reward tokens can participate in proposals or vote on proposals with the protocol.
In early 2020, Yearn launched as one of the tools to optimize productivity by automatically switching between different lending protocols. Andre, the developer of Yearn decided to distribute the governance token – YFI 0 to the Yearn user community in July 2020. Tokens are distributed entirely via liquidity mining – no funds, no home rewards funding, no dev fund. This model has attracted much support from the DeFi community, with cash flows in liquidity pools reaching over $600 million. YFI grew from 6 USD when it was first listed on Uniswap and peaked to over 40000 USD after being listed on Binance. => Many places jump to clone YFI,
September 11, 2020, YAM was launched. YAM tokens are also distributed in the spirit of YFI's fair launch. It is YAM that is the protocol that helps COMP, LEND(AAVE), LINK, MKR, SNX and YFI projects attract more attention of the crypto community by encouraging them to place these tokens on YAM's platform. . Less than 2 days after launch, a critical bug in the rebase mechanism was found. => Risk perception in prods with high APY
In August 2020, Sushiswap launched, began to transfer large amounts of liquidity from Uniswap.
After that, many more clones appeared.
Last event: Token UNI. All previous users of Uniswap suddenly received an amount of more than 1000 USD (at that time) => regain liquidity from Sushiswap.
