Tezos makes a run at DeFi and tries to catch Ethereum

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DeFi may be dominated by Ethereum, but Tezos is attracting users with lower fees and faster transactions.
Tezos Stable Technologies, a subsidiary of the Tezos Stablecoin Foundation charged with advancing DeFi development on the Tezos blockchain, closed a successful seed round, venture capital company Draper Goren Holm announced. The amount was not disclosed.
It’s the first step on the road to building a Tezos DeFi ecosystem to compete with Ethereum blockchain, in the hopes of drawing off some of the billions in liquidity that have so far gone almost exclusively towards Ethereum-based designs.
The newly launched Tezos Stablecoin Technologies will support the development and proliferation of USDtz stablecoins on the Tezos network, and will also soon release plans for a public sale of Trustee tokens (TRU). TRU token owners will receive a share of tokens from each new Tezos-based DeFi project launched in partnership with the organization.
Some of Tezos Finance (Tezfin) open-source projects are already in the works, such as lending platforms and a decentralized TEZEX exchange..
Tezos, which raised more than $230 million in a 2017 token fundraiser with the support of investor Tim Draper, is different from Ethereum in some key ways that could help it close the gap with Ethereum by volume.
First of all, on Tezos, nodes agree on the blockchain using delegated-proof-of-stake (DPoS) consensus, in which only designated nodes can generate or validate new blocks. The potential for greater centralized control in a DPoS system could be considered a disadvantage in comparison to the broader participation from users in Ethereum 2.0’s planned proof-of-stake design. While it risks being relatively more centralized, Tezos can upgrade elements of the base protocol without forking the blockchain and causing a potential community rift.
Tezos may outperform Ethereum’s current blockchain in terms of transactions, processing up to 40 transactions per second, in comparison to Ethereum’s 15, according to blockchain research firm BlockFyre. More transactions per second could allow DeFi apps on Tezos to accommodate more users at once without fees rising, a problem that has plagued the Ethereum blockchain recently. (Though this could be rendered moot by Ethereum 2.0.)
Tezos has attracted rising attention, not all of it great. Positively, it became a frontrunner for potential development of a digital version of the Euro currency. Less positively, the Tezos Foundation, in charge of guiding the protocol in its early days, recently agreed to pay $25 million in damages to users for disputes over the nature of the protocol’s initial 2017 token sale.
With real-world uses for blockchain technology coming to life in DeFi protocols, ETH competitors are trying to release their own DeFi products. Tezos has had its ups and downs, but seems to eventually be on solid footing to give Ethereum a run for its money across the DeFi landscape.

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