Programmers have found a way to replace core service offerings Wall street and an army of corporate attorneys with 800 lines of smart contract codes.
“From” means “decentralized” in DeFi, which means that there are no intermediaries in the process. Despite the raw and unpolished user interface, billions of dollars in assets flow through new decentralized applications every day.
We are only at the beginning of the growing DeFi bubble, and there are already tokens worth more than Bitcoin (BTC). Some of these tokens are nothing more than name, code, and clever marketing. There are shrimp, burger, spaghetti, and sushi tokens that have reached sky-high values, and many of these meme tokens even have “sequels”. It’s crazy about the 2017 ICO bubble.
Can everything be bad or can we use this technology forever?
Everything that can be tokenized can end up in a DeFi app. The pace of development is intense. Brilliant new projects are created every day: DeFi could one day be bigger than the internet. Everything is possible now.
Peer Finance also worked quietly in the background. It provides financial services to people based on real world use cases like payments, remittances, wealth preservation, and trading. People in emerging economies like Africa and India seem to benefit most from it. All DeFi transactions are peer-to-peer transactions as they take place in a blockchain.
Imagine a pure version of DeFi where we can pool fiat money like dollars and all of the world’s currencies. Why does the world need this? Do you remember the smooth onboarding part? This is actually a huge added value as more than 40% of the emerging world we operate in cannot provide adequate Know Your Customer service because localized KYC solutions are not well integrated or developed. Plus, many people don’t have ID, which is another way to get more people involved financially.
There are 1.7 billion people who do not have access to traditional financial services. When Bitcoin is the first tier, DeFi is the second tier and the “people” tier provided by P2P networks is the third tier. This decentralized, people-driven marketplace for money transfers only needs the smooth integration that decentralization brings with it.
Another big advantage is the decentralized pricing potential. Today’s decentralized exchange cannot because it uses a “Oracle” Prices from central exchanges. However, decentralized human-operated markets might offer a price based on P2P crypto trading and fiat trading. This can give us the true selling price of Bitcoin against the dollar, which would be of enormous value to people in hyperinflationary economies like Zimbabwe or Venezuela, Because the people there often have to consult many different sources.
Additional pricing models can be created in addition to the trading rules of the auction model. Here is a hidden product that is changing the world. Such price discovery would become the new standard and potentially affect the balance of geopolitical power.
Remember that we are in a bubble, but when it bursts the next bitcoin bull run will begin. So be prepared. Remember when the world falls into chaos “It’s good to be in crypto”, there it is crypto Protection from the collapse of the financial world. Bitcoin and Ether are completely solid as they now serve as real use cases.
DeFi tokens are literally playing with fire and you could get burned. Those who win this game buy, hold and constantly control the price. Bitcoin will always be the backbone of the crypto economy and grow. And DeFi will finish the job that Bitcoin started.
This article does not contain any investment recommendations or recommendations. Every investment and trading step is associated with risks. Readers should do their own research in making their decision.
The views, thoughts, and opinions expressed herein are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Ray Youssef is Co-Founder and CEO of Paxful. In addition to making Bitcoin accessible, Ray launched the #BuiltWithBitcoin charity initiative, which aims to demonstrate Bitcoin’s humanitarian capabilities. He is from New York City and has been a serial entrepreneur since 2001.