Time for straight talk! For over several decades, the financial system and institutions have shown alignment with those with the most means. Exuberant banking fees, high-interest rates, and penalties have left too many indebted, at the mercy of those who are enriching themselves. Make no mistake, I support capitalism – the ability for individuals to profit from their work or trade. However, what irks me is the massive bailouts funded by taxpayers to save those who live on profiting on the masses. Where is the accountability?
A revolution is needed! Bitcoin was the initial disruptor, but since it is readily accessible for banks and even hedge funds. They may not own Bitcoin as a community or system, but they are leveraging the currency by buying and adding it as a commodity to support stocks and the bond market.
This is where Ethereum comes and disrupts by developing a system able to build other ecosystems with ERC20 tokens and smart contracts, exchanges and several decentralized applications. Ethereum appears to offer concrete solutions and be the future of Decentralized Finance (DeFi).
DeFi is attempting to provide a non-centralized, uncontrolled, anonymous, and unbiased platform to save, borrow, and trade assets without the need for permissions such as by smart contracts. Simply said: Imagine if you could gain 8 to 10% on assets without your crypto ever leaving your digital wallet, or to be granted a loan without the need for an application or a credit check. This is what DeFi promises and could truly disrupt the financial system.
You can still earn high interest with stable coins such as Dai and USDC, or collateral loans with Compound, Aave, and Nexo. But still, Cryptocurrencies remain highly volatile; not withstanding, the recent waves of hacks of millions of dollars on several platforms. Currently, DeFi is in its infancy but shows great promise.
Open-source applications and protocols are more readily available to those who are looking for alternative finance solutions. DeFi could be that game changer that the world has been waiting for, but a little patience in warranted for the time being as the technology keeps developing.
Edited by: Frances Leblanc