Some experts critisize ETH readiness for DeFi

As DeFi projects do their best to settle the cooperation with Ethereum, the industry professionals inform that the project is not completely ready for such merging

Martin Froehler, a mathematician, ex hedge fund manager, and founder of Austrian crypto trading platform Morpher, mentioned insufficient capacities of the network despite the fact that Ethereum is the “best thing [the blockchain industry] has” for DeFi,

“Ethereum can only handle about 15 transactions per second and has a block-time of 15 seconds, which is an eternity in finance. By design everyone interacting with it needs Ether. That is a huge barrier to entry and mass adoption.”

Froehler treats Ethereum as the most decentralized smart contract platform. Though the existing issues has made the developers to look for solutions to solve them

Froehler added:

“There is cryptographic proof for everything that happens on the sidechain on Ethereum. (…) People are able [to] trade without needing Ether. They don’t pay any fees, enjoy a settlement time of one second, and are completely independent of the many congestions on the Ethereum network.”

Many industry players think Ethereum is not compatible with DeFi hype, and even future network upgrade, Ethereum 2.0, will to make it ready to service DeFi.

Ethereum 2.0 should improve its efficiency but high gas prices might decrease the amount of prospect users. Sergej Kunz, CEO of decentralized exchange 1inch, ha recently mentioned the following:

“You have to rethink everything. You can migrate smart contracts to the code but it’s not scalable. To be able to scale, you have to create standards and bring new protocols based on the new sharded architecture, such as NEAR which is similar to Ethereum 2.0.”

At the same event, Mounir Benchemled, founder and CEO of middleware layer ParaSwap, emphasized the difficulties in explaining how layer-2 works to end-users “and the risk of not being able to pay the funds immediately to these users”, having mentioned that this is the main problem. Benchemled also said that he sees  no  practical necessity to move all DeFi projects to Ethereum 2.0:

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