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DeFi- Redefining the way we access financial systems


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Traditional banking systems served as the gatekeepers of financial services for long, dictating how people access loans, save, and invest in opportunities. Typically controlled by a centralized system with a single authority such as a bank or government in total charge, this centralization is limited by high fees, restricted accessibility and slow transaction speed.

Dentralized finance, DeFi, got introduced as a blockchain-based financial system that removes intermediaries or central authorities, and utilizes smart contracts instead. By eliminating intermediaries, DeFi delivers core benefits like improved accessibility into the financial system for everyone having internet connection regardless of their location.

DeFi is also valued for its transparency. While traditional banking system often deny customers audits on how their assets are being managed, DeFi, through the help of blockchain allows anyone access to tracking and auditing transactions, thereby raising trust.

Furthermore, DeFi also offers various financial services and products like DEX, lending and borrowing, stablecoins etc, all known to proffer varied innovative solutions, while operating 24/7 in contrast to traditional finance.

DeFi isn’t flawless as issues like insecurity, lack of consumer protection etc are still prevalent; however, the growth of DeFi has been impressive; since its introduction, the total value locked in DeFi protocols has grown significantly indicating that the demand for DeFi services is fast growing.

DeFi seems to be redefining financial industry by offering an alternative to traditional banking systems. With the increasing adoption, can we expect to see an overhaul in the way we access financial services?

 

 

 

 

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Yeah, I believe the path has been set by the tokenization of customers' deposit in Citi Bank, one of the top largest banks in the world. If this becomes successful, I think a lot of other traditional financial institution will most certainly adopt it for faster and cheaper transaction world-wide.

Also there is a revolution in the crypto ecosystem right now where CEX are gradually becoming a hybrid of CeFi and DeFi with the incorporation of DEX-like features and integration of non-custodial wallet

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