DeFi Developers build DeFi Products. DeFi which stands for Decentralized finance, is a financial services that is offered on different blockchains. It includes many of the same services that are normally provided through a bank such as: lending, trading, and borrowing.
One of the main differences with DeFi is there is no longer a need to deal with banks, brokerages, or exchanges. With decentralized Finance there isn’t a need for a middle man or a third party when banking. Instead, transactions are peer to peer. Meaning that interactions are just between two people.
This significantly changes the way transactions work and come with a bunch of perks. With DeFi you can expect faster services, no more need for paperwork, and no bank fees for simple services. Decentralized finance now gives you the freedom to bank without the hassle.
There is nothing worse than being told you are prohibited from doing a certain type of transaction, or that if you want to pull out a big lump sum of cash that it will take days of doing so, due to daily limits of what banks allow. This type of traditional banking is becoming obsolete.
Banking should be made simple and available 24/7 at our fingertips. It’s time to take back control of our own finances in a system that is more efficient.
The difference between DeFi and Traditional Finance
How does DeFi Work
DeFi works by letting people do the financial services they currently enjoy, with decentralized technology. (Decentralization is when an organization is controlled by several authorities rather than one single entity)
Decentralized technology works by using cryptocurrencies and smart contracts to provide services. The majority of DeFi projects currently, are on the Ethereum blockchain. As many are built on Ethereum, the main components used are ERC-20 and solidity coding (which is created by DeFi Developers)
The way this works is smart contracts always run as programmed so this acts as the financial institution. Smart contracts will only act out what they are programmed to do.
For example, a smart contract could be to make a monthly payment to someone. The contract will then pay person B as long as the funds are in the account of person A.
Another aspect of Smart contracts is that they are transparent. Anyone, with the right tools, can view what the contract is and what is recorded on the blockchain.
Right now, this is viewable in code, many people will not understand but in the future, this could be understandable by all by using common language. Think of code compilers for developers for example.
What skills do DeFi Developers need?
DeFi developers will need an understanding of coding. Again as the majority of DeFi projects are on Ethereum, developers will need a strong grasp of ERC-20, and Solidity .
DeFi is a financial related product, so developers should also have a good understanding of economic concepts such as: supply & demand, inflation, financial incentives, etc. Smart contract developers are a requirement for any DeFi product.
ERC-20 is a technical standard that is used in order to implement tokens on the Ethereum blockchain. Ethereum is one of the worlds largest programmable blockchains. As Ethereum is a programmable blockchain, developers are able to use it in order to create their own tokens.
ERC-20 acts as a set of rules for developers to follow in order to create their own tokens. This standard makes it seamless for developers who are working on the Ethereum blockchain.
The ERC-20 standard significantly reduces the efforts required for developers to create digital tokens on the Ethereum network.
Solidity is a programming language that was designed for the development of smart contracts that run on Ethereum. Solidity is able to run on many other blockchains that are EVM compatible.
EVM stands for Ethereum Virtual Machine. The top six EVM compatible blockchains are: binance smart chain, fantom, polygon, avalanche, cardano, and tron.
Other categories of defi development include DeFi game development, yield farm development, smart contract auditing, DeFi index development. Even NFT Marketplaces like looksrare and NFT Games like DeFi Kingdoms have DeFi elements in the form of yield farming, staking, and similar concepts.
Disadvantages for DeFi Developers
- Using DeFi means you are your own bank now. This means you need to be organized and keep track of passwords and key phrases. If you forget your password, you could lose everything as there is no governing body to recover it for you.
- For some this can be challenging to understand or get started on their own. In order to get this working, you need to have a crypto wallet, set up key phrases, have ledgers, etc. This may be out of people’s comfort zones.
- Gas fees van be expensive. Gas fees are what pay for the transaction fee to go through. Depending on the price of ETH, or time of day. Prices can be upwards of $200, depending on the amount you are sending, this may not make sense to send money this way. Prices are not always this high, but they are definitely volatile and not the same daily.
- There is a lack of insurance
Hiring Defi Developers
Hiring a DeFi (Decentralized Finance) developer can be a great way to bring expertise in blockchain technology and decentralized financial applications to your organization. There are a few things you should consider when hiring a DeFi developer:
DeFi developers should have strong technical skills, including proficiency in blockchain technologies such as Ethereum, Solidity, and smart contract development.
Look for developers who have experience building DeFi applications or working on decentralized projects. They understand the level of detail needed to ensure security of smart contracts.
DeFi projects often involve complex technical challenges, so it’s important to hire developers who are capable of finding creative solutions to these problems.
Since DeFi projects often involve multiple stakeholders, it’s important to hire developers who are able to effectively communicate technical concepts to a non-technical audience. Also a commitment to the defi developer roadmaps associated with projects becomes critical to growth and communication on that timeline is crucial.
DeFi projects often involve collaboration with cross-functional teams, so look for developers who are able to work well with others.
If you can’t find the right talent for your project, you may want to consider looking for a Defi Development Agency
In general, it’s a good idea to thoroughly vet potential hires by reviewing their past projects and asking them to complete a technical test or coding challenge. This will help you determine their suitability for the role and give you confidence in their abilities.
Is it expensive to hire a DeFi Developer?
Decentralized finance (DeFi) developers are in high demand, and as a result, they can command high salaries. According to data from Glassdoor, the average salary for a blockchain developer in the United States is $158,000 per year. While it’s difficult to find specific defi developer salary data, it’s likely that they command salaries that are similar to or even higher than those of general blockchain developers due to the specialized nature of their work.
Evolving Field means Scarcity
There are several reasons why DeFi developers are in such high demand and command high salaries. One reason is the relative scarcity of qualified candidates in the market. DeFi is a relatively new and rapidly evolving field, and there is a limited pool of professionals with the necessary skills and experience to build and maintain DeFi platforms and applications. This creates competition for top talent, which drives up salaries for Defi developer jobs.
Another reason is the high level of expertise and specialized knowledge required for DeFi development. DeFi developers need to be proficient in programming languages such as Solidity, the primary language used for writing smart contracts on the Ethereum platform. They also need to be well-versed in decentralized architecture and have a deep understanding of the technical and security considerations involved in building DeFi platforms.
Upward Growth Trend of Industry
Finally, the increasing adoption of DeFi by businesses and individuals around the world has created a growing demand for DeFi developers. As more organizations and individuals seek to build and use DeFi applications and platforms, the demand for skilled professionals to develop and maintain these systems is likely to continue to grow.
Overall, it’s clear that DeFi developers are in high demand and command high salaries. While this can make it expensive to hire them, the expertise and specialized knowledge they bring to the table can be well worth the investment for organizations looking to leverage the power of DeFi.
Hiring an Agency of Defi Developers instead of In-house or freelance
There are several benefits to hiring a decentralized finance (DeFi) development agency instead of building an in-house team or working with freelancers.
Expertise & Experience
First and foremost, a DeFi development company brings a wealth of expertise and experience to the table. These agencies typically have a team of professionals who are well-versed in the latest technologies and best practices in the field of DeFi development. This can be especially valuable for organizations that are new to DeFi and may not have the in-house knowledge to navigate the development process.
Professionalism, Communication, and Accountability
Another benefit of working with a DeFi development agency is the level of professionalism and communication you can expect. Agencies typically have well-defined processes for project management and communication, which can make it easier to stay on track and keep stakeholders informed. In contrast, working with freelancers can be more unpredictable, as they may not have the same level of structure and accountability.
Hiring a DeFi development agency also offers greater flexibility and scalability. If your project requires additional resources or expertise at any point, an agency can often bring in additional team members as needed. This can be more challenging with an in-house team or with freelancers, as you may need to go through the process of hiring and onboarding new team members.
Additionally, working with a DeFi development agency can be more cost-effective than building an in-house team or working with multiple freelancers. Agencies often offer flexible pricing and payment options, which can make it easier to budget for your project.
Hiring a DeFi development services agency can bring a high level of expertise, professionalism, and flexibility to your project. It can also be a more cost-effective and scalable option compared to working with freelancers or building an in-house team.