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What Is DeFiChain (DFI)?
DeFiChain (DFI) is a blockchain platform built to maximize the full potential of DeFi within the Bitcoin (BTC) ecosystem. The software platform is supported by a distributed network of computers and is designed to facilitate fast and transparent transactions. The development team positions DeFiChain as an innovative blockchain project and offers solutions to scalability, security, and decentralization problems.
The project was launched in 2019 to offer financial services that commercial banks typically provide (borrowing, lending, investing, keeping funds). Yet there is a key difference between DFI and a banking network: DeFiChain is a decentralized platform. This provides many advantages: authorities and entities cannot control the network, and anyone has the right to participate in the launch of the network protocol. All actions support the entire network, and participants receive DFI tokens.
The DFI platform ensures fast, transparent, and decentralized financial services. The project is built on Bitcoin as a software fork and is tied to the Bitcoin blockchain using a Merkle root every few blocks. DFI transactions are non-Turing complete, making them fast and smooth, with low gas costs and a reduced risk of smart contract errors.
DFI’s initial functions and products include lending, token wrapping, pricing oracles, exchanges, asset tokenization, distribution of dividends, and more.
Who Are the Founders of DeFiChain?
The DFI Foundation owns all DeFiChain (DFI) trademarks and domains. The organization is responsible for developing the ecosystem, forging new partnerships, guiding the development of tools for partners, and overseeing DFI funds.
At the project’s origins are two key figures: Dr. Julian Hosp and U-Zyn Chua. Hosp is an influential and authoritative specialist in the crypto industry, with a large following worldwide. He is also the co-founder and CEO of Cake DeFi.
U-Zyn Chua, a fellow co-founder of Cake DeFi, serves as a chief technical officer (CTO) and researcher at DeFiChain. Chua is also a chief engineer at Zynesis and a blockchain advisor to the Singapore government.
What Makes DeFiChain Unique?
There are two towering blockchains in the crypto industry: Bitcoin (BTC) and Ethereum (ETH), which have inspired the emergence of decentralized finance. However, these early innovations have their limitations: Bitcoin has a long-standing reputation for security yet can only support basic BTC transactions. As for Ethereum, developers can create applications to perform more complex transactions, yet the network has problems with scalability.
This is where DeFiChain (DFI) comes in, aiming to tackle challenges like scalability, security, and fair governance. The solutions it proposes are as follows:
- Building a blockchain platform for DeFi use cases, which is based upon Bitcoin, to ensure a high level of security.
- Using a hybrid proof of stake (PoS)-proof of work (PoW) consensus mechanism for network operation.
The benefits of DeFiChain therefore include:
- Offering a full suite of financial asset classes to users in a permissionless and borderless manner.
- Supporting a wide range of crypto-economic and financial transactions.
- Offering high throughput for all transactions.
- Achieving a high level of security through its hybrid consensus mechanism and the fact that transactions are non-Turing complete.
- Offering developers the ability to create DeFi apps on one chain.
- Providing a reliable and decentralized governance system.
How Many DeFiChain (DFI) Coins Are There in Circulation?
DeFiChain (DFI) is the native unit of account for the DFI 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.
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 project didn’t participate in ICO or initial exchange offering (IEO) events, and the DFI team did not conduct any sales rounds.
How Is the DeFiChain Network Secured?
The DeFiChain (DFI) smart contract programming language is considered a safe option because it’s non-Turing complete. In addition, DFI is tied to Bitcoin (BTC) for security reasons: every few minutes, DFI takes cryptographic snapshots of the current state of the network and stores it on the Bitcoin blockchain (the action resembles a backup).
In September 2020, DeFiChain smart contracts were audited by SlowMist and in October of that year by KnownSec. No vulnerabilities were found.
DFI’s final layer of security is its hybrid PoW-PoS consensus mechanism, which takes advantage of the best aspects of each.
Where Can You Buy DeFiChain (DFI)?
DeFiChain (DFI) is listed on major cryptocurrency trading platforms like Bittrex. Other options for buying DFI include KuCoin, Uniswap (V2), DeFiChain DEX, Hotbit, LATOKEN, Bitrue, and the mobile app from DFX.SWISS.
Another way to get DFI tokens is direct purchase via the Cake DeFi platform. However, prices can be slightly higher there than on crypto exchanges.