Decentralized Finance Would Bring Global Revolution To The Sector Of Traditional Finance
Decentralized finance (DeFi) has been steadily growing in terms of both popularity and usage over the years, with it being largely linked to cryptocurrencies and blockchain technologies. One could thus argue that DeFi really has signified the beginning of an open and viable alternative as far as today’s financial system may be concerned, as decentralized finance has the potential to increase financial inclusivity.
DeFi had initially come to life through Ethereum (ETH)’s inception back in 2013, but it had not been till 2016-2017 that it had really come into its own. This is because it had been mainly in 2017 that ETH developers, along with a few entrepreneurs and analysts, had decided to provide backing and support to DeFi, thereby increasing its value and practical usage.
How has DeFi developed in recent years
Simply put, DeFi may be defined as the growing ecosystem pertaining to financial products based on blockchain technology. These products look to expand or replicate the various capabilities of the more traditional financial institutions, such as but not limited to payment processors, banks, clearinghouses, etc. DeFi is therefore often portrayed as a solution to all of the issues that the traditional financial and banking institutions tend to face, as it proves how the old ways may be replaced in real-time. Essentially, despite whatever platform or technology may be utilized, decentralized systems are often designed in such a manner that intermediaries between numerous transacting parties are done away with.
Furthermore, the amount of money that has been stored in smart contracts and the overall volume of the cumulative trading tokens within the DeFi ecosystem has indeed been increasing at an exponential rate. This proves that the concept of decentralized finance is not one that is going to go away any time soon. As of right now, there is an estimated total of just over $60 billion in terms of net value that has been locked in DeFi.
DeFi regulations and domination
Regulatory guidelines regarding DeFi and its related topics are often vague and seldom clearly defined, mainly due to the unfamiliar nature of decentralized finance itself. Nevertheless, a few nations have taken it upon themselves to implement strict regulations and restrictions, chief among which being the likes of the United States.
Regardless, DeFi has been growing and does not appear to be slowing down in the immediate future. There will hence come the point where we will need to actively consider when, and not if, DeFi shall be a key player as far as the world’s economic and financial infrastructure goes.
Tokenhell produces content exposure for over 5,000 crypto companies and you can be one of them too! Contact at info@tokenhell.com if you have any questions. Cryptocurrencies are highly volatile, conduct your own research before making any investment decisions. Some of the posts on this website are guest posts or paid posts that are not written by Tokenhell authors (namely Crypto Cable , Sponsored Articles and Press Release content) and the views expressed in these types of posts do not reflect the views of this website. Tokenhell is not responsible for the content, accuracy, quality, advertising, products or any other content or banners (ad space) posted on the site. Read full terms and conditions / disclaimer.
