DeFi investors seem to have settled for Flamingo–which offers free transaction costs and more rewarding liquidity pools– as a viable alternative to Ethereum for its increasing has cost. Since last year, yield farming and decentralized finance have become highly popular in the crypto community.
However, the prospect of making huge returns from the Ethereum network has not been realistic. Consequently, yield farmers are now trying other alternatives that offer lower fees. Flamingo Finance (FLM) is one of the options DeFi investors are looking at. FLM is a DeFi network built on the Poly Network and the Neo blockchain interoperability protocol.
Flamingo to Launch a completely DeFi network
Flamingo says it plans to establish an entirely decentralized network. Its protocol has a wrapper– a cross-blockchain asset gateway and vault, and a perpetual contract trading platform (perp). At the moment, the cross-blockchain asset gateway can wrap ERC-20 tokens such as Wrapped Ethereum (WETH), Wrapped Bitcoin (WBTC), and Ontology-based (ONT) tokens.
A user can interact with the protocol via the NeoLine or 03 wallet browser extensions for Neo tokens. Likewise, the Cyano wallet browser extension is used to interact with the ontology-based assets, while the MetaMask browser extension is suitable for the Ether-based network. Although Flamingo is not a direct competitor to Ethereum, its meager fees compared to Ethereum have been a genuine reason users see it as a better offer.
This also explains while the TVL price is appreciating. After wrapping and depositing collateral on the Neo blockchain, any transaction to be conducted on the Flamingo protocol attract a fixed fee of 0.011 GAS. Users also have the option to select a free transaction whose process is a bit longer.
The availability of competitive yields increases market liquidity
Initially, Flamingo started with an offer of simple staking and high-yield aimed to gain an early liquidity pool to enable it to assert itself firmly in the industry. It has now adopted another move by providing liquidity pool providers with yield offers, particularly pools requiring high liquidity. Flamingo, in a tweet, announced that the network was preparing for the release of Neo 3.0, whose Tesnet commenced on March 25.
As soon as it is fully executed, there will be a rise in the activity on the Neo 3.0 network, which will, in turn, boosts FLM price. Admittedly, Ethereum has gained more popularity than ever. This is reflected in the increasing rise in DeFi value, stablecoins’ global adoption, and NFTs’ wide acceptance. All these are prospects of a better future for Ethereum.
However, users are now experiencing unbearable pains using these Ether-based opportunities as Ethereum fees are at their highest level in 2021. In 2018, the Ethereum fee cost around $5.7 per transaction. But from the beginning of 2021, the fees have jumped as the average transaction cost now stands at $10.
Analysts have linked the high transaction costs to the increasing growth of Ethereum prices. A rise in the value of ETH shoots up the transaction cost. Added to that is the continuous rise in gas prices as a result of network congestion.