Bitfinex Launches First Bridge Connecting CeFi & DeFi
Last updated on December 4th, 2022 at 10:25 pm
Cryptocurrency exchange, Bitfinex, has announced the launch of a service that will act as a bridge between the centralized mode of operation of the exchange with the decentralized Layer 2 trading consensus and DeversiFi.
In the announcement, Bitfinex stated this is the first bridge developed by the platform and it will boost the speed of transaction processing and lower costs. It also stated that the bridge would enable the transfer of ERC-20 tokens, but it will initially start with Tether (USDT).
The announcement also stated that the Layer 2 bridge would boost the adoption of decentralized finance (DeFi).
With many new market entrants looking towards centralized exchanges as the first platform they use, having this bridge will make DeFi more accessible to these new users.
Traders from the two exchanges can now access the offerings of each platform without the need for transactions on the Ethereum Layer 1 platform.
DeversiFi will play an integral role in developing this bridge. It will be a gas-free Layer 2 DeFi platform that traders on Bitfinex can use to explore the DeFi sector. The traders will have access to more opportunities and yields presented by DeFi.
Furthermore, it will also allow a link between Polygon and Bitfinex. DeversiFi recently launched the first Layer 2 bridge for Polygon at the beginning of this month.
This option will be easy for traders to transfer funds between the Bitfinex exchange and the Polygon network while avoiding expensive on-chain gas fees.
DeversiFi and Layer 2
DeversiFi is a trading platform based on Ethereum. The platform uses the highly scalable StarkWare protocol.
One of the strategic moves the platform has made recently is to launch a Layer 2 bridge between Ethereum and the Polygon Network.
Speaking on Layer 2, the CEO and co-founder of DeversiFi, Will Harborne, stated that
“Layer 2 is the future of blockchain. Whether it’s the Lightning Network for Bitcoin or roll-ups like DeversiFi for Ethereum, cryptocurrencies and DeFi are finally on the verge of becoming accessible to everyone.”
In March, DeversiFi also launched a governance token dubbed DVF. Over half of the token’s entire supply was locked into liquidity mining rewards.
During the May funding round, the investors received 12.5% of the DVF token supply. This sale will allow the investors to have a long term stake in DeversiFi.
Also in May, DeversiFi raised $5 Million in an investment round spearheaded by ParaFi. The funding round was also supported by major venture capital firms and blockchain projects, including Defiance Capital, Lightspeed Venture Partners, Delphi Ventures, OKEx and Blockchain.com among others.
DeversiFi stated that the funds raised from the funding round would be used to grow the decentralized exchange platform by developing Layer 2 AMM protocols and other exchange features.
With decentralized finance and DEXs becoming popular in the crypto space, DeversiFI’s market reach is expanding and the firm could experience a surge in growth.
The recent partnership with Bitfinex shows that centralized exchanges are now looking into DeFi and how this sector can boost its adoption and presence in the crypto sector.
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