Long-tail DeFi assets are a very exciting trend in the cryptocurrency industry. Whereas these assets often suffer from a decrease in trading volume, Moma Protocol wants to provide them with infinite liquidity. An exciting approach that has attracted attention from various investors.
Long-Tail DeFi Assets Are Viable
For those who are unfamiliar with the concept, long-tail assets are plentiful in the cryptocurrency industry. These crypto assets are usually months, if not years in circulation, yet suffer from a low to non-existent trading volume. Rather than abandoning these projects, there is now an opportunity to give them a second lease on life. By injecting new liquidity into these assets with the help of decentralized finance, new opportunities are on the horizon.
More importantly, these long-tail assets can all benefit from extra “upgrades” including scalability. Various ideas have been experimented with in recent years, only to be held back by technical constraints. Combined with the renewed injection of liquidity and a potential new use case in the decentralized finance industry, there is an exciting market opportunity for long-tail assets.
Speaking of decentralized finance, Moma Protocol sees merit in long-tail assets. As a solution aiming to address scalability, liquidity, and speculation needs in DeFi landing, the protocol can create, manage, accelerate, and aggregate lending markets. With its proprietary smart contract factory, the ecosystem can evolve into unlimited lending liquidity and diversity.
At its core, this gives Moma Protocol a chance to create lending markets for long-tail digital assets. As there are hundreds of long-tail projects to choose from, some of them may play an intriguing role in the future of DeFi. As the industry is growing and evolving, users can explore some exciting new yield farming opportunities. Long-tail assets often have low liquidity, making them high APR candidates for liquidity providers.
Moma Protocol Funding Round
The approach by Moma Protocol to bring infinite liquidity to long-tail DeFi assets has attracted a lot of attention. Several prominent investors – including SevenX Ventures, Fundamental labs, DFG Capital, Coins Group, and others have invested $2.25 million in this new protocol. All of these investors agree there are improvements to be made in the DeFi industry, with lending being a crucial pillar of that sector.
A SevenX spokesperson comments on the investment round:
“As the most important foundation pillar of DeFi architecture — the loan agreement, Moma has made a unique and permissionless innovation here, which greatly enriches the diversity of the market. It has huge potential to become a scalable platform covering both the mainstream and long-tail digital assets.”
Even though the decentralized finance industry is still in the early stages of development, it is essential to keep pushing the boundaries. Exploring long-tail assets may prove to be a crucial move at this time. Several “forgotten” projects still have viable use cases and technology today. DeFi can bring some of these assets to the spotlight again and provide more liquidity to the industry.
Closing Thoughts
There is a side of the cryptocurrency ecosystem that most people have either forgotten or never knew existed. Like their counterparts in traditional finance, long-tail assets are of great value to the broader industry. Not all projects will regain momentum through this approach, yet no stone can be left unturned either.
The vision by Moma Protocol and its subsequent investment round confirms many people have high expectations for extra DeFi liquidity by leveraging long-tail assets. Decentralized finance gains momentum and more opportunities will ultimately lead to more users exploring the options at their disposal.
