DeFi is rapidly growing due to its acceptance in the financial sector, which has led to a profound transformation. This transformation is driving market growth at a compound annual growth rate of 42.5% from 2022-2030. DeFi potentially offers much higher returns to savers than high-street institutions: Compound, for example, has been offering an annualised interest rate of 6.75% for those who save with stablecoin Tether. Not only do you get interest, you also receive Comp tokens, which is an added attraction. With two-thirds of people without bank accounts in possession of a smartphone, DeFi also has the potential to open up finance to them. One final important reason for the surge in people putting money into DeFi tokens is to avoid being left out of their explosive growth. Many tokens are worth nothing or close to nothing in practical terms, so we are seeing a lot of irrational exuberance.

AAVE is the hottest topic in DeFi atm along with Yearn and Comp.

DeFi is like lego pieces and Comp is one of those pieces as well. If DeFi protocols are Lego blocks for developers to use in building new financial structures, then it’s important to remember that all structures are only as strong as their weakest points. DeFi compos-ability is a double-edged sword; in addition to all of its advantages, it also poses some risks. Since the beginning of DeFi, poorly designed protocols have resulted in millions of dollars in lost funds because of sloppy code and careless decision-making. This means developers who build and use DeFi protocols must pay extra attention to safety. Developers should prioritise safeguarding users’ funds by deeply analysing protocol security and economic stability; they should also rely more heavily on protocols that are time worn and battle tested. One of the major benefits of open-source software is that it tends to be better quality and more secure than proprietary alternatives, but only if it’s exposed to broad scrutiny and vigorous stress-testing. A strong structure can only be built with sturdy materials.

Optimism might be the next big bullrun along with DeFi projects like $AAVE , $COMP and $YEARN