Europe Is Transforming into a Defi Hub as the US Tightens Its Grip on Cryptocurrency

This year, the European decentralized finance (Defi) fundraising business has exploded, while on the other hand, most countries are becoming stricter with Defi.

Dove Metrics researched the European Defi market, indicating that things remain solid despite the market’s retreat and rising regulatory pressure. Now, Europe is positioning itself as a crypto hub, aided by success stories like Argent, Aave, Centrifuge, and Nexus Mutual.

According to a July 27 article, 56 European Defi teams have raised $282 million in funding, accounting for around 20% of global Defi fundraising. It also noted that the Stasis Euro-backed stable coin, EURS, has gained traction this year, with supply more than doubling in the last two months to 88.6 million today (worth around $105 million). Providing examples from European crypto and blockchain projects, the report found that the United Kingdom is leading the charge in terms of funding, accounting for 45 percent of the total Throughout Europe in the first part of the year.

This year’s notable investment rounds include synthetic trading platform Beyond Finance raises $7.5 million in March. Gro, a London-based Defi platform, closed a $7.1 million seed round in late March headed by venture capital Galaxy Digital and Framework Ventures.

Element Finance raised $4.4 million in April to provide Defi with fixed-rate liquidity. Liquidity raised $6 million in Series A financing to provide decentralized lending alternatives. When the protocol’s native LQTY coin became live on mainnet in April, its value soared by 900 percent.

According to the study, Infrastructure initiatives such as liquidity layers and real-world asset bridges accounted for 58 percent of total European funding received. With 12 percent and 9.7 percent, respectively, lending and borrowing and trading-related ventures followed in second and third.

The United Kingdom, Germany, France, and Switzerland accounted for more than 75% of all Defi European funds.

Defi condition in The US

The regulatory screws are tightening in the United States, with Defi and stable coins at the top of financial legislator agendas. Senators from the United States, such as Elizabeth Warren, are frothing at the mouth with their demands to regulate the sector.

At a Senate Banking Committee hearing on July 27, the Democrat senator continued to rail against digital currencies, declaring that “as the crypto market grows, so do the risks to our financial stability and our economy.”

She added that leaving the US financial system to huge bankers would be preferable rather than a “shadowy, faceless group of super-coders and miners.” Meanwhile, Treasury Secretary Janet Yellen met with finance lawmakers in a closed-door conference on Tuesday to examine Tether’s reserves, among other things.

However, the proposed rule on July 20 that would make crypto-transactions visible and traceable has not been without regulatory pushback in Europe.

Also Read: Binance CEO Working With Regulators To Established Binance As A Global Platform