Decentralized finance (DeFi) has been the star of the digital finance investment space in 2022, with a 190% increase in funding, despite the bearish trend in the overall crypto funding figures.
While the total crypto funding fell from $31.92 billion in 2021 to $18.25 billion in 2022, DeFi funding stood out with several projects such as Luna Foundation Guard’s (LFG) $1 billion LUNA token sale in February.
The DeFi sector has witnessed the convergence of DeFi and non-fungible tokens (NFTs), giving rise to the “NFTfi” ecosystem. NFTfi includes NFT projects leveraging DeFi to execute various trading strategies to generate passive income or undertake long or short trade NFT projects.
The growing DeFi investment indicates the evolving landscape of digital finance. As the industry continues to grow and mature, it will be fascinating to witness the ongoing competition and innovation between DeFi and centralized finance (CeFi), and what new trends and developments emerge in the future.