Can DeFi scale to real finance? What is missing?
DeFi has done major steps in the last 6 months, but can the DeFi scale to real finance? What should be added to DeFi to
DeFi
DeFi – Decentral Finance – refers to the Ethereum based finance ecosystem where the users are controlling their assets.
DeFi is a response to many crypto platforms, which controlled the client assets (from example centralized crypto exchange or centralized crypto lending). These central crypto platforms did not align with the key idea of the blockchain, where the users and only users should control their assets.
Following services are available in Decentral Finance:
- Exchange
- Lending and borrowing
- Margin trading
- Money market funds
One of the key issues in Decentral Finance is crypto collateral handling. DeFi systems keep all their business logic on the blockchain, there is no KYC (Know Your Client), there is no Crypto Credit Score. This results in the high collateral ratio in the Decentral Finance crypto lending.
In SmartCredit.io we respect very much the DeFi philosophy. However, we think the right approach is the hybrid solution between centralized crypto solutions and DeFi solutions. It’s about using the blockchain for what is really required on the blockchain and deploying other components (Crypto Credit Score, KYC, Collateral calculations) in the off-chain components.
Why the DeFi liquidity pooling has regulatory risk? What is the alternative?
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The Self-Reinforcing SmartCredit.io Crypto Lending Ecosystem
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Why is the Collateral Ratio So High in DeFi?
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How to earn passive crypto income with DeFi?
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Compound Finance Review 2020 (Everything You Should Know)
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Why Do Borrowers need Low Collateral Ratio?
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Why is DAI Interest Rate 10% in DeFi?
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BZx got hacked: What’s the solution?
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Risk Analysis of Crypto Lending Platforms
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SmartCredit.io Pitch from Paris Blockchain Week
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Lecture – HWZ Zürich, SmartCredit.io Deep Dive
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