Satoshi Natakmoto’s anonymity and powerful mining incentive engine are prime examples of what made Bitcoin (BTC) unique and led to unprecedented success. But for money and funding to be truly democratic, it’s worth reminding enthusiasts that Bitcoin was a repeat of a series of trials and tribulations that began in the 1980s.
David Chaum conducted research back in 1982 and laid the foundation for the invention of “computer systems built, maintained and trusted by mutually suspicious groups.” Other cryptographic designers, including Adam Buck, Hal Finney, Nick Szabo and Vitalik Buterin, among many others, have had a huge impact on advancing cutting-edge technology. Thanks to these pioneers, we are now embarking on a journey that will last a long time into the future, as experts and reformers tirelessly seek ways to improve and solve existing problems in the real world.
The spread of technologies like Bitcoin is as much dependent on the development of the infrastructure and devices that make them work. Satoshi’s 2008 paper report exactly coincided with the invention of the iPhone and the ubiquitous popularity of smartphones, which allowed mobile app developers to put wallets and other encryption-focused tools into the hands of millions of people around the world.
Innovate without permission
Bitcoin’s close cousin, Ethereum, has seen explosive growth in recent years, and there is agreement that it has become the driving force behind the controversial but undoubtedly restless ICO craze. That year, we saw the market value of global cryptocurrencies skyrocket to over $ 800 billion, which led political and economic leaders around the world to suddenly become aware of this technology.
Ethereum is now the de facto standard for everything not related to bitcoin. Identity management, market forecasting, supply chain management and real estate are just a few of the areas that have been subject to thought and experimentation on the Ethereum platform since its inception. However, the latest important promise is innovation in the world of decentralized finance.
Open source projects such as Uniswap, Compound, Yearn.finance, and Synthetix have skyrocketed in 2020. According to the data, USD 11 billion is reserved in smart contracts, providing liquidity for a wide range of financial services and instruments for lending and payments. , insurance, derivatives and decentralized exchange.
Unlike the old banking infrastructure, DeFi is of interest to industry participants and enthusiasts by allowing anyone to create and launch financial products in an unauthorized manner. Breaking the impasse that has characterized global banking for decades will, over time, remove key players with monopoly power and influence. Many hope that DeFi will help build financial services in a fairer way and open the door to economic growth for individuals and communities that are still understaffed.
Isn’t everything centralized?
In the corporate world, long-term vision is built from the top down, from the board of directors and through management to employees.
In contrast, many of Defi’s recent projects are being built with the goal of rapidly decentralizing the wider community of token holders to build structures from scratch. It does this by relinquishing control over key components such as treasury management, code changes, and legal entities to eliminate isolated points of attack from nation states or intruders.
Tackling rising wealth inequalities, political corruption, and company technology monopolies in innovation hubs such as Silicon Valley are all part of what motivates many industry players. A culture of radical decentralization has developed within the major factions of the crypto society. However, there is still debate about whether this extreme approach is the most effective way to solve social problems.
Limiting disproportionate control or influence from key players is an undeniable priority. However, frequent driving in a spirit of “decentralizing everything” at all levels of industry and technology can lead to inefficiency.
Defi’s rapidly evolving nature makes it difficult to predict the future. Will the supply of liquidity in the chain be institutionalized? Will billions of people around the world be able to connect to your chosen income groups? What’s the future of Central Exchange with groundbreaking innovations like Uniswap and Loopring now in the spotlight? When liquidity leaves centralized systems, what is the future of payments?
What innovative methods will be developed in this new and unlimited world of smart contracts and “growing money” to secure networks, ensure high transaction speeds and create attractive incentives for customers?