In essence, decentralized finance, or simply DeFi, refers to blockchain technology and smart contracts to create decentralized financial applications. Instead of depending on centralized authorities like banks or governments, these applications are powered by a network of users. Earnity executives Dan Schatt and Domenic Carosa want the people to take advantage of this independent banking.
DeFi is a term that covers blockchain and Ethereum applications. It utilizes blockchain, allowing more than one entity to keep a duplicate of transactions, meaning there is no single source that controls the processes. Unlike centralized finance, DeFi promotes transparency, accessibility, and flexibility. In addition, it gives people the power to manage their finances.
A Growing Movement
Transparency is a quality of DeFi that is attractive to many. Through blockchain technology, transactions are transparent, improving due diligence while reducing financial frauds and unpleasant business procedures. While some believe that DeFi would be the end of traditional banks, the statement is unlikely. Instead, it would be best to see DeFi as a movement that will reshape the current financial industry.
Many functions of centralized financial institutions will soon make their way into blockchain infrastructures. As centralized finance is regulated, integrating DeFi into their services could take a while, as regulators have the reputation to lag behind emerging technologies. DeFi developers and proponents ought to speak with the government and regulators to better explain to them the movement’s objectives. Educating regulators on a topic as complex as DeFi would encourage positive solutions for issues they may find.
Earnity executives Dan Schatt and Domenic Carosa, look to create platforms to educate the public about DeFi, crypto, and blockchain, which can help speed up mass adoption. It would also encourage people to participate in the movement’s goal to transform the current financial industry.