Degens play a big role in crypto. So what does degen mean in crypto and NFT? You can love them or hate them. But Degens are very helpful for the crypto community.
The influential and erratic developer of Yearn.Finance, which converts customers' cryptocurrency deposits into significant cash returns (often), retweeted a picture on September 28. It simply said "Spartans" and came from a recently established account called Eminence.Finance.
At that time, Cronje was a decentralized financial god who had made a lot of money for cryptocurrency traders, and one Yearn Finance token was worth more than $28,000. The tweet, which made reference to an alleged video game project Cronje was working on, was all the motivation investors required to join in on the next great thing.
After a little more than 24 hours, $15 million worth of cryptocurrency had poured into Eminence. There was just one issue: It didn't actually exist.
Insanely high gains come with insanity-high hazards. The tale of DeFi, which epitomized the erratic and unpredictable crypto year of 2020, contained equal amounts of both. A nearly disastrous March, during which the majority of DeFi degens "rekt," was quickly followed by the DeFi summer, during which values grew rapidly. Loan repayment success stories with annual returns of 100% were so prevalent as to be ordinary. If we can call it that, the DeFi bubble is still intact.
For instance, Cronje's Yearn.Finance token, which debuted in July, increased from $31.65 to $32,345 by the end of August. For those keeping track at home, that is a gain of 77,000%. (It currently rests serenely at a slightly more modest $25,000). Despite Cronje's own description of it as "valueless,"
With market capitalization over $500 million, projects like AAVE, Compound, Uniswap, and others have had comparable success and stampeded like a herd of unicorns. And it appears like the race has just begun. The total value locked in DeFi is currently $13.8 billion, just shy of the record high of $14 billion it reached on December 19.
The first-ever Decrypt People of the Year are the "DeFi degens," a word that has emerged to define the self-described degenerate-gambler traders and architects who are pushing the boundaries of decentralized finance. The degens, in our opinion, constitute the most significant and defining development in cryptocurrency in 2020.
DeFi, also referred to as "open finance," is the first thing you would tell to a crypto novice if you were trying to explain the degen phenomenon to them. These words cover a variety of financial products constructed on top of a blockchain. People can send money straight to each other without a financial middleman getting a cut thanks to a blockchain's immutable transaction log that is cryptographically secure enough.
DeFi, then, disrupts the conventional model while disintermediating it, unlocking fresh value and opening up new business options. This is similar to what the Internet did for the media.
The origin of De-fi
Not all DeFi users are degens; there is a spectrum of decentralized finance regulars. On one end of the spectrum are casual users—those who invest money in a project for the long term but don't obsessively check on it. Traders, who are actively trying to make money, are in the middle. The degens are located on the opposite periphery.
The word "degen" plays off the phrase "degenerate gambler," which suggests a familiarity with the possibility of financial catastrophe. Many people who are considered degens, however, would prefer to identify as traders. Without worrying about possible losses, they can "experiment," "speculate," or "take a calculated risk."
