We don’t learn the real economy in school. Instead, we study the economics of voodoo. For example, professors rarely give us valuable insights – if ever – from the Austrian School of Economics.

Therefore, people must violate the condition in order to understand how the economic world works. The truth about how the financial system is built, how it works, who controls it and so on, is a whole new world for them.

If you really dig into the truth and start to see how everything works, you can form certain connections, such as why Jesus expelled money changers from the temple, how Britain became a great empire, and why the US dollar lost its purchasing power. Energy. Lots of people spend money on a daily basis without questioning the system behind it.

I am thinking of two theories about the future of the financial world. One theory is that smart technologists have created blockchain technology, a decentralized economy, and all of these technologies that are taking over the world. The second theory is that large financial institutions or governments have experimented with similar technologies and today may be 10 years before the public DeFi movement. In any case, the elites behind the major reconfiguration of the World Economic Forum, which seek to transform the global economy, have a plan and a new financial system ready to take off.

As elites rebuild the global economy in their favor, cryptocurrencies develop services that rival the most powerful corporations and central banks on Wall Street. Entrepreneurs and developers are starting to create what they call the decentralized economy, which is an entirely new system in which users can decentralize money lending, among other options. A few years ago, you only had to do it through the bank.

Although not long ago only central banks could print cash, DeFi has created technologies by which people can encrypt their transaction currencies in the form of tokens or digital currencies. The Internet has decentralized the content creation and distribution process; For example, anyone can own a YouTube channel. DeFi does the same with financing.

DeFi is the next evolution of the financial system
We used to use gold as the global currency because it was so small. Bitcoin (BTC) has copied this scarcity model. The Medici were at the forefront of the early banks, encouraging people to keep gold with them in exchange for a check to claim your gold. They realized that no one would ask for all of the gold at once, and they began lending their assets – like some DeFi technology today. In a sense, you can predict DeFi’s future by looking at banking history.

DeFi’s most promising apps to date include protocols for decentralized interest rates, liquidity pools, coin pools, and more. For example, suppose you have $ 10,000 in your bank and the bank gives you 0% or negative interest on money. DeFi platforms offer solutions where you can earn 3% -4% on the same amount of $ 10,000.

DeFi Threatens Big Banks. They were opponents of Bitcoin as they experimented behind the scenes with basic blockchain technology. They suspected that Bitcoin could alter the balance in the financial world. They are now releasing their stablecoins and distributed ledger infrastructure.

If you look at JPMorgan Chase, it recently launched its own distributed ledger with the Singapore government. Typically, the primary innovators were two to three years ahead of these giants. For this reason, I do not yet see the major banks taking revolutionary steps towards DeFi. Large banks will first focus on proven distributed ledger solutions such as cross-border payment solutions, replacement of cloud systems with distributed ledger systems on cloud, etc.

The future of the decentralized economy
Many factors today influence DeFi’s future. One of them is, for example, Ethereum 2.0 and its attempts to solve Ethereum’s scalability problem. Its success or failure will affect everything related to the Ethereum blockchain.

Another factor is how banks and regulators respond to the DeFi phenomenon. Nowadays, it has to regulate itself as an industry. We must act ethically and develop solutions like insurance that gives people a guarantee. Unless we develop and adhere to these standards, DeFi will not be able to compete with the traditional banking system.

Crypto contractors need to educate the public about DeFi to help them understand why this new technology is useful to people in their daily lives. Moreover, an overall adoption of DeFi alone is unlikely.

Source: CoinTelegraph