With the widespread and rapid adoption of Internet 3.0 and Non-fungible tokens (NFT), cryptocurrencies and block chain have become common parlance for most millennials who earn. However, as a relatively new mode of financial transactions, these concepts come with their own set of risks. Singapore-based platform Defy aims to address these risks and make NFT transactions easier than ever. Founded by Amogh Tiwari and Ujwal Gupta in 2022, Deefy has quickly made its presence felt.
“In the current NFT landscape, there is no method to generate revenue, only speculative price increases over time. Deefy expects this problem to only get worse as NFTs gain mainstream adoption This is already a growing issue for some NFT holders, such as funds that invest in expensive/useful and long-term yield-generating NFTs These NFT holders want to earn returns before reselling them and do not have the desire, time or expertise to do so. The vast majority of these assets sit idle in portfolios. NFTs such as virtual art, game assets, virtual land, domain names, intellectual property rights, etc. could be rented to users for a nominal rental fee to generate revenue,” explains Amogh in a conversation with The story deciphered.
The NFT Landscape
Amogh dropped out of college in 2015, while pursuing a degree in Product design to National Institute of Fashion Design, Chennai, and Defy is his fourth company.
“My father is a truck driver, so it was not an option for my family to take risks. My journey has not been easy, but design has always been my main characteristic, and I have more than four years of experience in art direction and product design. I also love physics,” he shares.
Ujwal has a comprehensive engineering background, having studied at Jamia Millia Islamia University in Delhi. He has over two years of blockchain development experience. Together, their journey to Deefy went through a long-term and consistent understanding of blockchain and digital assets. They uncovered a major problem that needed solving, and in doing so, were able to stand out as enablers rather than creators.
The idea is simple – Deefy is a cross-chain loan and rental platform for millennials. They enable instant loans from NFTs and digital assets and create a credit rating. With Deefy, NFT owners get instant financial value on their verified and approved NFTs.
Amogh further explains, “Deefy acts as an escrow account between lenders and borrowers. We ensure that only quality borrowers and lenders are accepted, and we do this by calculating the floor value of NFTs. We’ve created game-changing change by introducing a truly decentralized ecosystem and focusing on delivering creator-centric products for creators, influencers, Gen Z and micro-financiers.
Since launch, Deefy has unlocked billions of dormant NFT liquidity by introducing a decentralized ecosystem that relies on creator-centric financial instruments.
The Deefy team aims to enable one billion digital asset owners and add more financial services to the decentralized finance ecosystem over the next two years.
How it works?
As a decentralized protocol built on top of the major blockchains that enable buying, renting and lending of NFTs and digital assets, Amogh says Deefy is quite unique from everything else.
He describes the problem saying, “NFTs lack the essential utility framework used by other financial instruments right now. Therefore, two major problems arise. The first is affordability, as NFTs require a high upfront payment as well as gas fees. There are no options for IMEs or “pay later”. The second problem is that of liquidity.
He believes their USP addresses these issues well. The founders claim that Deefy is the world’s first platform enabling “Buy now and pay later” in an NFT marketplace. This makes NFTs more affordable for users. Moreover, they do this without requiring collateral, as it is powered by their credit score.
By leveraging Deefy’s multi-chain financial instruments, owners of digital assets and NFTs get a high return on their investment as well as the opportunity to grow their asset portfolio and value.
The platform is called “DeFi”, the term which stands for “decentralized finance”. Since the term has been tainted due to many rugpulls and scams, the team has changed it slightly. They wanted their name to be easy to remember and identify, as this would help build trust among their customers.
There is no subscription to sign up to use Deefy but the team charges a percentage commission on successful trades.
Data released by Emergen Research indicates that the NFT market will reach 3 $57,316.3 million by 2030. It also notes the main driving factors behind this phenomenal growth – the growing use of NFTs in supply chain and logistics and a growing demand for decentralized marketplaces.
Amogh explains, “Our P2P lending MVP is live on testnet. We’ve fulfilled $100,000 in loan applications on supporting chains like Ethereum, Polygon, and Binance. We also have a growing community of over 1,000 members and received a grant from Polygon, which enabled us to establish a key marketing partnership with Polygon Studios.
The team believes Deefy’s success has depended on four factors – affordability, increasing liquidity, creating less risk and reducing time. Apart from catering to a pan-Indian customer base, they also focus on Western and European markets as the users there are more educated. More relaxed regulations from an operational standpoint have led to greater adoption of NFTs there.
However, the challenges exist, with constant growth being the biggest problem. Amogh explains that Web 3.0 applications adopt decentralized architecture, pseudonymization and user-owned data, therefore, they break all common growth strategies. Major Web 2.0 consumer applications have achieved massive scale by leveraging centralized platforms such as Facebook. They bring online identity to engender trust, in the process of collecting huge sets of proprietary data. Web 3.0 apps, on the other hand, don’t have an app store, don’t know who their users are, and have no way to communicate with them.
“We are overcoming these issues by partnering with the Polygon chain NFT marketplaces and focusing on community-led growth. We are also looking at token-focused growth pools and building communities and focusing on integration markets,” he says.
Next, the team is working on launching its public beta and partnering with artists for it. They plan to generate $1 million in monthly revenue during the third quarter and establish major partnerships with lending banks to share the vision of decentralized lending. Other key partnerships they are working on include those with major collections like Bored Ape and Opensea.
The traditional unsecured lending market is an $11 trillion global industry — but none of those loans had been on-chain until TrueFi completed DeFi’s first unsecured lending in 2020 Things are about to change and players like Deefy are at the forefront of this digital revolution.