Are DeFi decentralized financial answers to better financial management?

金色财经 view 49067 2022-1-14 09:39
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From the dotcom bubble to the devastating subprime credit crisis, important financial processes have repeatedly failed us. This is not surprising, as this system is designed specifically for the highest levels of the business community, which ultimately determines the fate of small businesses looking for candy.

Assessments and balance sheets have been put in place to avoid the impact of high financial volatility. However, as we have seen in many financial cases, these measures are not enough. After all, humans are not infallible.

Cryptocurrencies such as blockchain and Bitcoin peaked between 2017 and 2018, and also led to greater reliability and the inability to change the way money was spent and traded. However, Wall Street has failed again and cryptocurrencies are "victims". ~

A new strategy emerged in 2020 that called for delivering key financial services with blockchain transformation combined with information technology to deliver goals while bringing multiple changes.

It's all about decentralized finance, or what we now call DeFi, and aims to democratize financial markets without the frenetic speculative nature that plagued ICO (first coin offering) activity in 2018.

Using smart technology, big data and smart contracts, companies in the DeFi space have been growing, hoping to see a change in the way they operate. ~

Challenge appears

As with any new idea, interest is high when they first appear, especially when these new ideas are legally "committed".

This is why ICOs exploded in 2017 and 2018, when cryptocurrencies became a particularly difficult buzzword for inefficiencies in modern financial systems.

In the meantime, the crypto-space business has taken off, spanning everything from peer-to-peer libraries to supporting virtual pets.

There is one big perk that was popular in the crypto community back then. This is where you can benefit from your resources without being limited by an intermediary. And the endorsement of this price increased the crypto project. There is no doubt that cryptocurrencies have seen great potential right now. ~

However, the crash happened at the end of 2018. Consumers lost interest, investors didn't take advantage and managers knocked on the door. Some argue that "poverty" is due to weakness in cryptocurrencies, while others point out that the cryptocurrency market, especially in Asia, was minimal at the time.

Experts have many explanations, but it can be pointed out why cryptocurrencies are not popular. That is, there is no general understanding of groups such as contractors, users and administrators. What really prevents cryptocurrencies from thriving is their ambiguity.

Although cryptocurrencies have recovered since the collapse and generally soared, the emergence of DeFi remains questionable. Bubbles like 2017 will come from a market ruled by smarter devices, as communities shift away from market-driven cryptocurrency market thinking to marketplaces like the intelligence and intelligent engagement.

This is not the case, according to Renato Barba, CIO of MachinaTrader, a company that develops expertise for the cryptocurrency industry.

Now, the main difference is that DeFi operations to which rights are open to the public have been carried out through smart contracts, giving DeFi operations confidence in the business world. We also have to consider that since 2017 the cryptocurrency market has gained recognition and the market has grown.

He also added that unlike the ICO bubble, DeFi projects will undergo external tests designed to verify the accuracy of smart contracts.

This increases the reliability of the project for users and investors and reduces the risk of becoming a victim or a fraudster. ~

Existing jobs

DeFi is the same distribution hardware as most crypto campaigns that emerged during the 2017-2018 boom, but proponents of this technology say DeFi works differently.

This is particularly important as DeFi aims to provide an alternative to non-crypto financial service providers, with the best of both worlds exploding across the crypto space.

The main difference is that they use sophisticated intelligence and smart contracts. This means creating an easy way to trade while providing full transparency so that users can truly understand the platform they are using. public first. ~

Renato Barba said that as the business grows, users need to better understand how to legally use the De De platform.

As an average user, when using the DeFi platform for various financial applications, you should understand how some of these technologies work, such as building your own wallet from services like Metamask. This is also why many users prefer exchange media like Binance and Bitpanda because they are easy to use.

To achieve the independence DeFi truly demands, industry partners must pay equal attention to making the device accessible to all types of users while maintaining its integrity, which is not easy.

long and winding road

Without a doubt, DeFi has many of the same promises as the original cryptocurrency project. In other words, it offers a great alternative to financial aid. However, as a youngster, it will be difficult to ensure that the cryptocurrency leader has a vision for independent financial governance.

DeFi platforms need to be more understandable and aware of their operation and user benefits, so that the public can easily access these platforms just like Is Flames is available all over the world.

This is important not only for users, but also for participants who are hesitant to participate in DeFi, such as traders and administrators whose action decisions are affected by their understanding of the technology.

Finally, the DeFi site is expected to deliver on promises made to weak users after the cryptocurrency crash. DeFi must identify ways to improve trust and overcome the risk of misrepresentation that favors malicious individuals whose behavior may be detrimental to the development of technology.

DeFi may lead to greater financial control, but that will be the vision through 2018 to overcome the inability of ICOs.

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