Out of all business opportunities we have in 2020, DeFi Projects are probably the brightest ones and getting the most attention from people. Even though this concept is relatively new, we can still “separate” its arrival on the market in two phases.
The first phase is where only the cryptocurrency enthusiasts paid attention to it, and the second is what we call the slightly more “commercial” phase where investors, lenders and borrowers all became interested in this concept.
But, all this seems relatively complicated to someone who doesn’t even know what DeFi stands for. Well, let’s clear any misunderstandings right off the start so we can continue.
What is DeFi and what does it stand for?
DeFi means “decentralized finance”, and it’s a ground-breaking new system in the world of finance, where everyone can create their own smart contract protocol and become an investor or a lender, borrower even.
Many people see the potential in this business so we rapidly see the number of such startups increasing in 2020. We feel like 2021 will be the year for DeFi-related businesses, so if you are considering to do the same thing, check out these five important tips.
1. Planning out the concept
Even though it’s a relatively new thing, carefully planning out your DeFi project to make it unique and different from what’s offered on the market at the moment is crucial. Experts say that the success of your product depends on the planning done beforehand. The preparation in such projects is important both from strategic and financial aspect.
This also is not your “average” financial project, there is tons of legal work involved in it, so unless you have the right team for it, we don’t really think it’s possible to pull such a project off.
2. Gathering the right team for the task
This is exactly what we wanted to say in the previous part but we’ll say it here. You need a team of skilled programmers, people who are very familiar with the law, someone who understands how finance works on a very deep level, as well as a great marketing team for the post-release phase of your project. Each role is equally important and you should give your best to put such a complete team together before starting.
By proper marketing we mean explaining this concept in a way that anyone can understand instead of filtering out the audience by making things complicated. For an interesting example on this subject and a bit of inspiration on how to present your project to the masses, Clva.com is a website where you can see more.
3. A lot of dedication in the development phase
This is pretty obvious but it’s the phase where the magic happens. Proper organization in the development phase, respecting deadlines and being open and honest about the quality of your project is the key to success. Don’t just view it as a solution from a boss or owner’s standpoint. View it from the shoes of a customer. Would you choose this DeFi project as a financial solution if you were just an “average Joe?” If the answer is yes, you are probably headed in the right direction. If the answer is not, there’s probably something you need to change in your idea.
Currently, a lot of people feel like the DeFi concept is unknown and risky, so you’ll have to come up with an idea that will let others know this is safe and upcoming concept with a life-changing influence in the financial field.
4. Test phase before release
Any product no matter what kind needs to be properly tested before release. The same thing goes for your DeFi Project as well. In the past two years there were a lot of hacks happening around various DeFi projects, and about thirty millions dollars in price were lost. These are money that can put an end to your career in terms of bad reputation, if it happens to your customers to lose them. According to experts, all of this could be prevented with some top-notch quality testing. You can either form your own group of testers or hire a company that’s specialized in testing such projects.
5. Properly marketing and targeting the right audience when done
When done developing your DeFi project, you need to pitch it to your audience in the right way. This seems like an easy thing to do at first but the more you get into it you start to realize it’s not as simple. Like we said above, DeFi is a fairly new concept and in order for you to make money from it, you need to carefully explain how it works to people who have no idea about cryptocurrency or anything relate to it. Ensuring them that their money are safe is the number one goal to accomplish during this phase.
You don’t have to be the biggest crypto-currency enthusiast to know that Bitcoin and Ethereum are the two market-leading coins available these days. And, you also don’t have to research this topic a lot to find out DeFi projects are on the rise like never before.
All this will probably intrigue you to start your own DeFi project in the few upcoming years, and that’s exactly what we’re here to help you with. Feel free to check out our tips above and thank you for dedicating a part of your time to read this article. We hope we were helpful and we wish you the best of luck with your finance in the future. Stay safe.