PlasmaPay, a digital payment dApp created on top of the Plasma Blockchain, is planning to bring the DeFi sector to masses, to help unbanked population get access to financial services.
As many are likely aware at this point, the DeFi sector has completely dominated this year. DeFi, or decentralized finance, is a common name for projects that offer financial services similar to those of centralized financial institutions. However, as the name suggests, it does it in a decentralized way, thus expanding the possibilities of the crypto industry, and reducing the need to rely on centralized institutions.
DeFi has been around for years now, but it only reached high levels of popularity in 2020. But, the surge in interest, projects, and invested money that it saw could possibly be matched by the big ICO crypto craze of 2017.
Earlier this year, DeFi was barely approaching $1 billion. At the time of writing, the DeFi sector already has well-over $13 billion locked within different projects, led by the likes of Uniswap, yearn.finance, Maker, and others. However, the extreme popularity of the sector — which originated on Ethereum’s blockchain, and is currently the strongest within the Ethereum ecosystem — has started to severely affect ETH.
The problem is that transaction fees have skyrocketed, and it has become extremely slow due to massive transactional demand. In other words, while DeFi is only getting started, issues with the platform on which it is based are severely affecting it, and preventing it from growing further.
This is where PlasmaPay comes in to help solve it.
How will PlasmaPay solve the issues with DeFi economy?
According to its recent announcement, PlasmaPay seeks to address the issues that the DeFi sector has encountered and built a much more suitable financial services infrastructure for the digital economy of DeFi.
The project believes that DeFi is the future, and a vital part of the upcoming Web 3.0.
In total, there are three issues that the company has identified, and it seeks to address them all. Those include:
1. Ease of access
2. Scaling the infrastructure
3. Scaling the market
In essence, PlasmaPay aims to help DeFi reach its full potential, and become as big as it can get. Some would argue that the DeFi sector has already seen a massive growth, and that is true. However, keep in mind that the entire DeFi sector has around $13 billion locked within.
Meanwhile, there are individual cryptos , such as Bitcoin, Ethereum Tether, and even XRP, which have a similar size of the market cap, while being single coins, rather than an entire sector.
Not to mention that the entire crypto industry is basically still nothing more than a speck of dust when compared to traditional finances.
This is why it is important to tackle these problems as soon as possible, and why PlasmaPay aims to provide the means through which the DeFi sector can grow to its full potential, and take the rest of the crypto industry with it.
What does PlasmaPay Aims to Accomplish?
Improving ease of access is perfectly sensible, as simplicity is necessary for anything to be widely adopted, and especially something that is this new and still a bit rough around the edges. Meanwhile, Ethereum’s struggles are showing how much the current infrastructure of even the biggest projects is behind the demand.
By working on solving these problems, PlasmaPay will bring additional benefits, such as the reduction of the time needed to process transactions, achieving lower cost, making it easy to onboard clients who wish to use DeFi for banking, support traditional assets, and at the same time — it will allow international payments to actually happen in real-time.
This all may seem like a lot, and a major promise that PlasmaPay needs to maintain. However, the team has already been working on solving these issues since 2018. Their financial platform, exchange and wallet for crypto and fiat, operates in 165 countries and has over 100,000 customers.
With the DeFi sector exploding, but still facing technical difficulties, PlasmaPay aims to solve them by providing a better, more scalable system for it to grow to its full extent. The project already has a massive reach and offers free and flexible banking and non-custodial options.
Now, it aims to take the next step, and bring DeFi to a much greater number of people, and help it become the future of digital finance.