DeFi “must be the foundation” of every financial product: Robert Lesnar of Compound

the summary

  • During the recent Terra crash and the resulting crypto crisis, DeFi continued to operate without a “hiccup,” Compound co-founder says.
  • Lesnar argues that this distinction should be key to helping regulators see the value of DeFi.

One way to look at this summer’s crypto liquidity crunch – and the resulting bankruptcies and bailouts of central lenders – is how we’ve shown that Decentralized Finance (DeFi) is working.

At least it is organisation Founder Robert Lesnar sees it.

“I think the last few months have undoubtedly demonstrated the benefits that DeFi offers,” Lechner said. Decrypt At Chainlink SmartCon in New York. “DeFi should be the basis of every type of market and financial product in the future.”

as such Bitcoin Collapsed and centralized companies like the now-bankrupt Celsius are struggling to keep their business afloat, and the first debt they started paying off were debts made in the land of DeFi.

While many creditors are still waiting to see their money, last July, the lender company Pay Its latest decentralized loan is to MakerDAO. Previously, the percentile had gone down from Sly back then aviSo is Leshner’s Compound Protocol.

Throughout this mess, none of these platforms have experienced a single “hiccup” thanks to smart contractsUnstoppable icon and vision.

“Essentially every DeFi protocol, including Compound, has gone through incredibly turbulent times without a hitch,” Lechner said. It has been designed to achieve radical transparency. So everyone knew exactly what assets were in the Compound, what the borrowers looked like, how healthy the borrowers were, and all the collateral needed to support those loan positions was already owned by the Compound. “

The funds, for example, were not used anywhere else to gain additional leverage. (If that was the case, everyone on Crypto Twitter would have known.)

As for managing the various centralized platforms, Lesnar said, there wasn’t any of that transparency, so companies like Celsius and Voyager could take their customers’ money and do whatever they wanted with it.

“No one knew what they were doing; unlike the DeFi protocol, they were allowed to run their business as they saw fit.” “They lent aggressively, unsecured, to Three Arrows Capital, traded their clients money, or did all these crazy things that nobody thought was their business model. And those are the problems with CeFi [centralized finance]. And these are the things I think regulators should look and say “Wow, if they were DeFi, none of this would happen”. “

Make everything stable currency

Meanwhile, for exampleThe rapid growth of dollar-pegged blockchain tokens over the past two years has been astounding. This raises a key question: why not put all financial markets on the blockchain?

“I think we’ll start to see a lot of different things stablecoinsBoth for foreign currencies like the pound or the yen, but also for different assets, says Lesnar.

So instead of just flying a vanilla order on several blockchains, he claimed we would soon start seeing assets like real estate or government bonds.

And most importantly, everything will look like a stable currency – only linked to something else.

“In most use cases and examples, a real asset — whether it’s real estate, stocks, bonds or anything off-chain on the blockchain — will look like a stablecoin,” Lesnar said. Additionally, these new types of assets will see “a lot of adoption in DeFi“Over the next decade.

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