google-news-img

DeFi Tokens Being Non-Uniformly Distributed : Analysis by Conti

  • Decentralised Finance soared high this year with a new all-time high at $4.23 billion in terms of total value locked in DeFi.
  • A new analysis revealed that not all the tokens are being distributed uniformly among its users.
  • Conti, the co-founder of DeFi Italy, revealed that only 500 different addresses hold up to 90% from nearly every DeFi project out there.

DeFi, short for Decentralised Finance, soared high this year with a new all-time high at $4.23 billion in terms of total value locked in DeFi. However, a new analysis revealed that not all the tokens are being distributed uniformly among its users.

Simone Conti, Head of Digital Asset Investment of CryptoLab, has recently shown his analysis regarding DeFi distribution in his tweet. Conti, the co-founder of DeFi Italy, revealed that only 500 different addresses hold up to 90% from nearly every DeFi project out there. He concluded that this figure rises to 99% in the case of three of the DeFi projects.

DeFi Tokens Distribution

According to the charts provided by Conti, Compound is the most concentrated of the Top 10 projects he examined, with 96% total supply being held by a few dozen people from the top 50 holders.

Conti reported that five addresses hold over 40% of the majority of DeFi’s respective total supplies. Bancor is the only anomaly in this even when the top 5 addresses hold 33% of the supply.

Conti also observed that older projects are much more distributed in total supply than the new ones, which indicates that DeFi’s growing popularity has attracted large investors.

A Tricky Task to track

Tracking of token distribution remains a tricky task as different analysts produce a wide range of figures based on the criteria on which addresses to include.

Spencer Noon, head of DTC capital, believed that $YFI has already become the most decentralised DeFi project within two weeks of its entry.The combined ownership percentage of top 5 addresses is according to Noon are as follows : $COMP (64.6%), $BAT (24.5%), $MKR (23.5%), $ETH (12.9%) and $YFI (9.5%).

While this marked as contrast regarding Conti’s evaluation that YFI’s top addresses hold almost 60% of the total supply. Hence, it became quite debatable regarding the analysis. Conti announced that he would share future research when he goes more in-depth in the context. He will consider issues regarding reported tokens listed in severals Cex/Dex representing large amounts for his subsequent analysis.

DeFi is making efforts to bring Decentralized governance and fair distribution. It automated the process of yield farming, which became its rocket fuel. Liquidity pools appear to be adding value and increased utility to numerous DeFi platforms. YFI and other governance tokens are operated by particular communities, which is a positive step for DeFi as it further democratizes the crypto space.

Disclaimer

The contents of this page are intended for general informational purposes and do not constitute financial, investment, or any other form of advice. Investing in or trading crypto assets carries the risk of financial loss. The forecasted data (also called “price prediction”) on this page are subject to change without notice and are not guaranteed to be accurate.

Our Newsletter

Subscribe to our newsletter to get the latest news and promotions.

Ahtesham Anis
Ahtesham Anis
Ahtesham Anis is a Computer Science undergrad student currently based out of India. Coming from the business background and his keen interest in Cryptocurrency and Blockchain technology is what Ahtesham brings to the table. He is always an eager learner when it comes to exploring the new technologies and topics in the crypto world.