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Blockchain

Decentralised Finance

Google Cloud and web3 startup Orderly Network have joined hands to create developer tools tailored for decentralised finance (DeFi), aiming to simplify entry into the world of decentralisation.

Together, they will focus on developing off-chain elements of DeFi infrastructure, with a specific emphasis on addressing challenges related to self-custody and transparency. Orderly Network will function as a DeFi infrastructure provider, accessible through the Google Cloud Marketplace.

<blockquote class="twitter-tweet">
ANNOUNCING: Google Cloud and Orderly Network's Exclusive Collaboration!<a href="https://twitter.com/googlecloud?ref_src=twsrc%5Etfw">@googlecloud</a> accelerates its Web3 push, teaming up with <a href="https://twitter.com/OrderlyNetwork?ref_src=twsrc%5Etfw">@OrderlyNetwork</a> to drive safer and faster DeFi adoption. 
 
Explores Tailored Web3 product suite.. 
 
Everything you need to know 👇 <a href="https://t.co/87ieWDb6Gm">pic.twitter.com/87ieWDb6Gm</a>
— Orderly Network (@OrderlyNetwork) <a href="https://twitter.com/OrderlyNetwork/status/1702325468425580665?ref_src=twsrc%5Etfw">September 14, 2023</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

<h3>Google Cloud adapts to blockchain boom with web3 solutions</h3>

Google Cloud revealed that this collaboration was initiated in response to growing interest from clients exploring blockchain applications on their platform. Rishi Ramchandani, Head of Web3 in the Asia-Pacific region at Google, noted that the increasing demand underscores the need for a customised suite of web3 products.

<blockquote class="at-quotes">
"Working with Orderly Network to build robust infrastructure will help address the gaps in DeFi adoption and growth, and ensure scalability in the continuously evolving space through the development of secure and user-centric enterprise developer tools."

<div class="author">Rishi Ramchandani, Head of Web3 in the Asia-Pacific region at Google</div>
</blockquote>

Blockchain technology has become a central focus in the fintech revolution, prompting various players in the financial industry to explore decentralised technologies. Even traditional institutions like JPMorgan have been actively testing blockchain-based solutions, including DeFi applications. A 2021 report indicated that 55% of the top 100 banks had some level of involvement with blockchain technology.

<div id="tab-link-wrapper-plugin">
<div class="heading-text">Also Read</div>

<ul class="tab-link">
	<li class="editor-readmore"><a class="editor-rel-content" href="https://www.web3cafe.in/emerging-tech/story/whatsapp-introduces-whatsapp-channels-in-india-here-step-by-step-guide-on-how-to-use-it-and-its-features-678218-2023-09-14">Here’s how to create your own WhatsApp Channels</a></li>
</ul>

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<h3>Orderly Network balances DeFi speed and decentralisation</h3>

Orderly Network aims to distribute DeFi operations into both on-chain and off-chain components to strike a balance between speed and decentralisation. This approach aims to streamline processes while preserving the inherent benefits of decentralisation. Critical interactions will occur on-chain, while less resource-intensive tasks will be efficiently managed off-chain.

Arjun Arora, Chief Operating Officer of Orderly Network, emphasised the importance of blockchain technology outperforming existing solutions for mainstream adoption. Orderly Network is working on a versatile trading solution to seamlessly integrate decentralised applications across various blockchains, merging the strengths of decentralised and centralised exchanges.

<blockquote class="at-quotes">
"Our collaboration with Google ensures our matching engine competes with centralized systems seen in traditional finance, but the rest of our infrastructure and liquidity network retains all the benefits of self-custody and transparency seen in decentralized finance."

<div class="author">Arjun Arora, COO of Orderly Network</div>
</blockquote>

Overcoming entry barriers and enhancing security has long been a challenge for DeFi. Google Cloud's partnership with Orderly Network aims to create a secure environment and tools to address these issues, ultimately advancing the mainstream adoption of DeFi.

These two companies will collaborate on enhancing off-chain aspects of DeFi infrastructure, particularly emphasising self-custody and transparency challenges.


Google Cloud responds to surging interest in blockchain with custom web3 solutions

Arjun Arora emphasises blockchain's need to outperform current solutions for mainstream adoption

Google Cloud & Orderly Network joins to simply DeFi access

blockchain

defi

Google Cloud & Orderly Network come together to simplify DeFi access & security

Google Cloud & Orderly Network streamline DeFi security

BarnBridge DAO, which runs a decentralised finance (DeFi) protocol, has suspended all project-related activities following an alleged probe by the United States Securities and Exchange Commission (SEC).

In a recent announcement on the platform's Discord channel, Douglas Park, the organisation's lawyer, informed members about the ongoing investigation and advised them to pause work on BarnBridge-related projects, including the closure of liquidity pools.

The SEC's inquiry has prompted caution to minimise potential legal liability. While limited details are available regarding the SEC probe, Park acknowledges the alleged SEC's investigation into BarnBridge DAO and individuals associated with it but did not provide specific reasons for the regulatory scrutiny.

Due to the non-public and ongoing nature of the investigation, Park emphasised that sharing extensive information is currently restricted. Co-founder Tyler Ward, also known as "Lord Tyler" at Discord, later confirmed the veracity of Park's message on BarnBridge's Discord platform.

<blockquote class="twitter-tweet">
<a href="https://t.co/ChsjBuGEzM">pic.twitter.com/ChsjBuGEzM</a>
— BarnBridge (@Barn_Bridge) <a href="https://twitter.com/Barn_Bridge/status/1677110787780018176?ref_src=twsrc%5Etfw">July 7, 2023</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

<h3>Proposal to retain legal counsel coincides with SEC probe</h3>

Coincidentally, prior to the SEC probe, a proposal was put forth for BarnBridge DAO token holders to retain Park &amp; Dibadj, the law firm managed by Douglas Park, as legal counsel. Between 30 June and 3 July, 100 percent of BarnBridge token holders casted their vote on a proposal to retain Park &amp; Dibadj as their legal counsel.

An overwhelming support was received, with 94.3 percent of the votes casted in favor of the proposal, thus reflecting token holders’ trust in Park's legal expertise. The timing of this proposal suggests that the SEC investigation may have already been underway.

<drupal-entity data-caption="100 % of token holders casted their vote in favour of proposal. Source: Snapshot" data-embed-button="ckeditor_image" data-entity-embed-display="view_mode:media.image" data-entity-type="media" data-entity-uuid="27ea5aff-d2ea-417b-9683-86e85f20f8e4"></drupal-entity>

While some members of the Discord community expressed suspicion regarding the SEC's investigation, suggesting potential ulterior motives, Ward dismissed such claims, stating that it would be an ill-conceived attempt to defraud investors.

<div id="tab-link-wrapper-plugin">
<div class="heading-text">Also read</div>

<ul class="tab-link">
	<li class="editor-readmore"><a class="editor-rel-content" href="https://www.web3cafe.in/blockchain/defi/story/what-is-decentralised-finance-know-its-benefits-539174-2023-04-07">What is decentralised finance? Know its benefits</a></li>
</ul>

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Others reacted humorously, making light of the situation by suggesting relocation to evade the SEC or playfully referring to SEC Chair, Gary Gensler's tough stance on cryptocurrencies.

<drupal-entity data-caption="Mixed reactions from BarnBridge DAO members on Discord. Source: Discord" data-embed-button="ckeditor_image" data-entity-embed-display="view_mode:media.image" data-entity-type="media" data-entity-uuid="3639d26a-9a24-4b8b-a7f7-455513933578"></drupal-entity>

<h3>BOND token experiences a price drop</h3>

Following the news of the SEC investigation, BarnBridge's native token, BOND, saw a 1.9 percent decline in price, reaching $3.12 according to CoinGecko. Since its all-time high which was recorded in October 2020, BOND has suffered a significant decline of 98.3 percent and currently holds a market cap of $29 million.

In short, the response to an alleged probe by the SEC, BarnBridge DAO has paused all operations. The SEC investigation prompted the organisation's lawyer to advice members to cease work on BarnBridge-related projects. Specific details regarding the SEC's inquiry remain undisclosed.

Following the news, BarnBridge's native token, BOND, experienced a 1.9% price drop.

In response to a probe by the US Securities and Exchange Commission, BarnBridge DAO has paused all operations, while specific details regarding the SEC's inquiry remain undisclosed. 

The SEC investigation prompted members of BarnBridge to cease work on all projects

100 percent of BarnBridge token holders casted their vote on proposal to retain Park & Dibadj as their legal counsel

Following the news, BarnBridge's native token, BOND, experienced a 1.9% price drop

BarnBridge DAO to halt operations amid SEC investigation

SEC investigation prompts BarnBridge DAO to halt operations

BarnBridge DAO to pause operations amid SEC probe

The use of real-world goods as collateral for loans being taken on decentralised finance (DeFi) platforms was unheard of, but that’s about to change.

As per Arcade, which is a DeFi&nbsp;lending platform for NFTs, someone took a loan on its platform using two luxury Rolex watches as collateral. This is the first time that a platform has accepted a real-world asset for on-chain transactions in the open market. 
&nbsp;

<div class="embedcode">
<blockquote class="twitter-tweet">
Someone just took a $14,500 loan on two Rolexes at 12% APR from a complete stranger all on-chain 
 
The Rolexes were sent to an escrow company who then sent back NFTs representing ownership of the watches 
 
The borrower can then use those NFTs to tap into global liquidity rather… <a href="https://t.co/wjLbpEpmd8">pic.twitter.com/wjLbpEpmd8</a>
— Cirrus (@CirrusNFT) <a href="https://twitter.com/CirrusNFT/status/1669064880949985280?ref_src=twsrc%5Etfw">June 14, 2023</a></blockquote>
<script async="" charset="utf-8" src="https://platform.twitter.com/widgets.js"></script></div>

It is expected that this event could open up new avenues in the decentralised finance space in the long run.

<h3>How did the transaction take place?</h3>

As per the lending platform, the borrower committed two Rolex watches for a loan of $14,500 at an annual interest of 12 percent. He later sent these watches to an escrow service to be placed there till the money was returned to the lending platform with interest.

The company in a statement said,

<blockquote class="at-quotes">
These @ROLEX watches, stored at @4KProtocol, are being used as collateral for DeFi loans on Arcade. Using real-world assets (RWAs) like luxury goods on-chain could open up a huge market for DeFi.
</blockquote>

If in case the borrower of the loan defaults, Arcade can state a claim to the Rolex watches with the escrow service. However, if the borrower pays back the loan, the lender is entitled to a 12 percent profit at the end of the loan tenure.

<h3>More NFT use cases highlighted</h3>

An advisor to Arcade, Cirrus,&nbsp;went on to highlight the use case of NFTs in this scenario where the company sent back NFTs to the borrower where they could use those NFTs to tap into the global liquidity it offers. The fact that NFTs are immutable codes recorded on the blockchain gives the owner proof of ownership which cannot be altered by anyone.

Not only that, NFTs are programmable which means that they can be programmed to become null and void if the borrower exceeds the time period of the loan payment.

<div id="tab-link-wrapper-plugin">
<div class="heading-text">Also Read:</div>

<ul class="tab-link">
	<li class="editor-readmore"><a class="editor-rel-content" href="https://www.web3cafe.in/blockchain/story/uniswap-sushi-and-more-defi-platforms-launch-on-ethereum-layer-2-platform-zksync-era-533686-2023-03-28">Uniswap, Sushi &amp; other DeFi giants launch in Ethereum layer 2 zkSync Era</a></li>
</ul>

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Cirrus explained that NFT-backed loans are a much safer way to take transactions forward instead of depending on pawn shops or being at the mercy of loan sharks.

<blockquote class="at-quotes">
“The Rolexes were sent to an escrow company, which then sent back NFTs representing ownership of the watches. The borrower can then use those NFTs to tap into global liquidity rather than take a predatory loan at their local pawn shop. If they default? The lender can use the NFTs to redeem the watches. One of the most obvious and easy-to-understand use cases of NFTs.”

<div class="author">Cirrus</div>
</blockquote>

On 14 June, the DeFi lending platform announced that it has reached $100 million in loan settlements and that the company is continually striving to make inroads into the NFT-backed loan market.

<h3>Why this is big for NFTs &amp; DeFi</h3>

This transaction has set a precedent for the DeFi sector as more companies will start to explore the possibilities of real-world assets for on-chain loans. Since NFT lending has been capped by the types of NFTs and is mostly restricted to the digital artwork space, this could unlock access to an unexplored segment of NFTs.

The physical collectibles market was estimated to value $402 billion in 2021. It is projected to hit the $1 trillion mark in the coming 10 years. As the lending process becomes easier on-chain, we could see an influx of these real-world asset loans, subsequently opening doors to more avenues in the decentralised finance space.

In what seems a disruptive move for decentralised financing, a person used two Rolex watches as collateral for the money he loaned from a DeFi-lending platform. 


$14500 was borrowed from the DeFi platform

The Rolex watches were placed with an escrow service

Borrower received NFTs as proof of loan

Rolex watches used as collateral on DeFi platform

Someone got NFTs in exchange for two Rolex watches used as collateral on a DeFi-lending platform

Rolex watches used as collateral on DeFi loan platform

The U.S. Treasury Department warned on April 6, 2023, that North Korea, cybercriminals, ransomware attackers, robbers, and con artists are exploiting decentralised finance (DeFi) platforms to transfer and launder their illicit proceeds. 
 
DeFi platforms enable users to lend, borrow, and save without utilising banks, typically in the form of cryptocurrencies and stablecoins. The fundamental element of DeFi is that there is no centralised authority that can impose rules or regulate behaviour.

<h3>Illicit actors are exploiting vulnerabilities</h3>

 
In a recent illicit finance risk assessment on decentralised finance, the Treasury discovered that criminal organisations are taking advantage of gaps in international and domestic Anti-Money Laundering / Countering the Financing of Terrorism (AML/CFT) legislation, enforcement, and the technology supporting the services. 
 
According to the study, DeFi services that disobey these obligations to stop money laundering and terrorism funding provide the worst danger of illicit finance in this area. 
 
According to Brian Nelson, the Treasury's Under Secretary for Terrorism and Financial Intelligence, "Our evaluation reveals that illicit actors, including criminals, con artists, and North Korean cyber actors, are using DeFi services in the process of laundering illicit assets." 
 
Nelson stated that the private sector should take action to stop criminal actors from utilising decentralised finance services by using the assessment's conclusions to guide their risk mitigation techniques. 
 
Additional problems in the assessment included the possibility that DeFi services could be free from current AML/CFT duties, lack of application of international AML/CFT standards, and inadequate cybersecurity procedures. 
 
The assessment suggested enhancing U.S. AML/CFT regulation, after taking into consideration further advice for the private sector on DeFi duties, and addressing any regulatory loopholes related to the services. 
&nbsp;

&nbsp;

&nbsp;

According to the U.S. Treasury Department DeFi services are being used to transfer and launder illicit gains.

DeFi services are being used to illicitly transfer and launder money

Cybercriminals are exploiting DeFi platforms to steal data

DeFi services lack AML/CFT duties and inadequate cybersecurity procedures

DeFi services utilised for unauthorised transfers said U.S Regulators 

U.S. Regulator: DeFi services utilised for unauthorised transfers

DeFi services being used for unauthorised transfers

In 2022, funding related to decentralised finance (also known as DeFi) grew by 190 percent compared to 2021. In contrast, investments in centralized funding (CeFi) fell by 73 percent to $4.3 billion.<o:p></o:p>

Interestingly, total crypto funding dropped from $31.92 billion in 2021 to $18.25 billion in 2022 as the crypto market went from bullish to bearish.<o:p></o:p>

<h3 class="MsoNormal" style="text-align: justify;">Why is the DeFi sector growing?<o:p></o:p></h3>

The aforementioned report states that these numbers "may point to DeFi as a new fast-growing area of ​​the crypto industry, while the decline in CeFi funding may indicate that the industry is reaching saturation."<o:p></o:p>

The fact that the DeFi space&nbsp;is developing at a faster pace&nbsp;and that there are more on-chain participants are two factors contributing to the DeFi segment's growth. Conversely, the decline in CeFi funding may reflect industry saturation.<o:p></o:p>

Last year, the largest DeFi funding came from Luna Foundation Guard's (LFG) billion dollar LUNA token sale. This happened almost three months before the May 2022 crash of Terra Luna Classic (LUNC) and TerraClassicUSD (USTC).<o:p></o:p>

Speaking of centralized financial funding, FTX and FTX.US raised a total of 800 million euros in January 2022, which is a total of 18.6% of CeFi's funding last year.<o:p></o:p>

It's interesting to note that the blockchain infrastructure, blockchain technology, and service sectors continues to garner favourable responses for funding in the cryptocurrency space during the past five years. Even GameFi and NFTs saw significant increases in investment in 2021.<o:p></o:p>

The financing for the AI &amp; Data sector increased by 65.1 percent year over year, which was another industry that experienced growth. Meanwhile, no increase was recorded in the mining industry and the social sector.<o:p></o:p>

According to a recent report, decentralised finance projects  attracted the majority of  investments from digital asset companies in 2022.

Projects involving decentralised finance garnered a lot of financing in 2022

A decline was noticed in initiatives relating to centralised funding

GameFi, NFTs, and blockchain-related businesses also drew significant funding

DeFi sector witnesses growth

DeFi attracts huge amounts of money; GameFi & NFT on the rise: Report

DeFi attracts huge amounts of money: Report

Web3

AllianceBlock, a blockchain-independent platform created to connect trade finance (TradFi) and decentralised finance (DeFi). It has agreed to incorporate data from Crunchbase, a business information platform for private and public companies, into its ecosystem. 
 
The transaction marks Crunchbase's first entry into the cryptocurrency market. The company's data, which includes details on investment rounds and profitability, will first be accessible to users of AllianceBlock's Data Tunnel. Users can publish, share, and consume data in a number of formats through the tunnel. 
 
When this collaboration gets going, Crunchbase will join the volatile Web3 space, where its data streaming tools will boost Data Tunnel by AllianceBlock. A game-changing application, Data Tunnel is expected to speed up innovation in the fields of Web3 and DeFi. 
 
AllianceBlock's CEO highlights the importance of this collaboration 
 
According to Rachid Ajaja, CEO and co-founder of AllianceBlock, "the buying and selling of data is a multibillion dollar growth business that shows no signs of slowing down." However, up until now, users and providers of both traditional and decentralised data have worked separately and have been unable to communicate. 
 
The agreement comes after AllianceBlock's most recent collaboration with investment company-ABO Digital, to provide institutional and individual customers with a number of tokenised investment products. 
 
As Bonq, a decentralised borrowing system, was hit with an exploit worth about $5 million last month, the AllianceBlock token (ALBT) fell by 51%. In response, AllianceBlock stopped trading the token, took a snapshot, and then released a new token to replace the legacy ALBT. 
 
Combining traditional and decentralised services 
 
AllianceBlock and Crunchbase's partnership will make DeFi opportunities available to the 75 million dealmakers who use Crunchbase. The data collector itself will also make use of DeFi's disruptive potential. 
 
In order to handle common problems in the digital business, create a trustworthy data ecosystem, and increase confidence, Web2 and Web3 services must work in perfect harmony. Users of Data Tunnel can now construct innovative technical designs like default probability models, frameworks for customer interaction, maps of unexplored markets, and more.

Users of the AllianceBlock Data Tunnel will be able to import both DeFi and Crunchbase data.

AllianceBlock collaborates with Crunchbase

DeFi instruments will have access to data that is more trustworthy and accurate 

The partnership will make DeFi opportunities available to the 75 million dealmakers who use Crunchbase

AllianceBlock and Crunchbase's partnership will make DeFi opportunities

 AllianceBlock signs an agreement with Crunchbase to bring traditional business data to DeFi

AllianceBlock and Crunchbase signs a partnership 

Crypto Shankar

The Ethereum layer 2 scaling network, zkSync Era, has enabled quicker and less expensive transfers after four years of development. On March 24, between&nbsp;32 to 50 initiatives, including some of the biggest names in decentralised finance like Uniswap, Sushi, Maker, and Curve, are scheduled to launch.

The majority of Ethereum DApps can easily port over with very little modification thanks to ZkSync Era, the first zk-Rollup compatible with the Ethereum Virtual Machine to debut on mainnet. The network can scale "orders of magnitude" more than Ethereum's present 10–12 transactions per second (TPS), starting with "tens of TPS" and increasing as needed.

<h3>Increase in transaction speed</h3>

The "fair onboarding alpha" of the project, which debuted on February 17, enables projects to port over and try out security and optimisations. The creators of zkSync Era, Matter Labs, claimed that to lower the possibility of any incidents, they had spent $3.8 million on security testing, seven independent security assessments, and a bug bounty programme.

Zk-Rollups, such as zkSync, Scroll, and products from Polygon, StarkWare, and Consensys, compute transactions away from the Ethereum blockchain while offering a small cryptographic proof that is written as a single transaction back on Ethereum showing that a collection of other transactions has been completed correctly. ZkSync also uses recursion, which produces a proof demonstrating the execution of a number of other proofs (each depicting numerous transactions).

<h3> 
Faster Withdrawals for users</h3>

Compared to optimistic-rollup layer 2s like Optimism, where withdrawals take a week, Zk-Rollups can allow almost instant withdrawals. However, as a security measure, zkSync Era will originally impose a 24-hour waiting period.

Every account in the network is now a "smart account" thanks to ZkSync Era's native account abstraction feature, which also enables two-factor authentication (2FA), social recovery, autopay transactions, and other features through purveyors of smart contract wallets like Argent.

The network won't be entirely decentralised at launch, allowing the team to quickly resolve any security or technical problems. A time lock, however, will subsequently be put in place so that the Security Council and the general populace can approve of choices. Similar to its rival StarkWare, zkSync depends on a central prover and scheduler, which are quicker but offer a single point of failure.

Decentralising that portion of the network is more challenging because running a prover requires paying $10,000 per month for cloud capability or purchasing expensive hardware. This year, a new proof system that significantly lowers hardware requirements should be made accessible on the mainnet.

Overall, the zkSync Era is a significant advancement for Ethereum, which has been battling scalability problems for years. The mainnet launch of the network has the potential to significantly lower gas costs and allow quicker, more effective transactions, which would be advantageous for both DeFi projects and other Ethereum-based programmes.
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Several decentralised finance platforms like Uniswap and Sushi have now launched on the Ethereum Layer 2 scaling solution zkSync Era for faster transactions.

DeFi platforms launching in Ethereum Layer 2

zkSync to offer faster transaction speeds

Users will be able to withdraw funds faster

zkSync Era onboards DeFi giants

Uniswap, Sushi & other DeFi giants launch in Ethereum layer 2 zkSync Era

DeFi giants launch in Ethereum layer 2 zkSync Era

Explainers

Decentralised finance, popularly known as DeFi, is an emerging financial ecosystem based o based on secure distributed ledgers. Here, financial products are publicly available on a decentralised blockchain network. It lets users buy and sell assets as well as financial services as a form of investment or financing, thus avoiding the middlemen.<o:p></o:p>

It must be noted that DeFi makes use of blockchain technology, which connects users without a central server and can transfer data and assets securely.&nbsp; Here, transactions are regulated under smart contracts that also use blockchain and run automatically when the parameters the parties set in advance are met. In other words, DeFi uses cryptocurrency and blockchain technology to manage financial transactions. It aims to democratise finance by replacing legacy, centralised institutions with peer-to-peer relationships that can provide a full range of financial services, be it everyday banking, loans, and mortgages, to complicated contractual relationships and asset trading.<o:p></o:p>

In order to have in-depth knowledge of decentralised finance, let us in brief understand what is centralised finance.<o:p></o:p>

Here in centralised finance, banks and third parties hold money, thereby facilitating the movement of money between parties and levying fees for using their services. Here, each entity in the chain receives payment for its services, for instance, a credit card charge starts from the merchant and moves to an acquiring bank, and so on. Moreover, it must be mentioned that in the case of centralised finance, all financial transactions are overseen in centralised finance, right from loan applications to a local bank's services.<o:p></o:p>

Decentralised Finance, indeed, is being viewed both as a revolution and an opportunity, and has a profound influence on the way banks operate. Let us now look at some of the significant advantages and disadvantages of DeFi.<o:p></o:p>

<h3 class="MsoNormal" style="text-align: justify;">Pros of decentralised finance:</h3>

<h3 class="MsoNormal" style="text-align: justify;"><o:p></o:p></h3>

<drupal-entity data-caption="Decentralised finance offers numerous advantages" data-embed-button="ckeditor_image" data-entity-embed-display="view_mode:media.image" data-entity-type="media" data-entity-uuid="e958414d-2b8e-4897-9b2c-35d51f146a81"></drupal-entity>

<h3 class="MsoNormal" style="text-align: justify;"><o:p></o:p></h3>

The DeFi movement aims at introducing various benefits for customers and investors. Some of the notable advantages of DeFi include:<o:p></o:p>

Permissionless<o:p></o:p>

One of the most striking features of DeFi is its decentralised nature. In fact, decentralisation is one of the basic tenets of blockchain, which helps in reducing the need to depend on corporations. This enables simple and effective access to financial services for every individual.<o:p></o:p>

Transparency<o:p></o:p>

Decentralisation offers better transparency, and the distributed ledger features information about all activities on the blockchain network, thus improving due diligence. In other words, DeFi provides transparency through the openness of blockchain data, which can be viewed by anyone at any time.<o:p></o:p>

Good-bye to human error<o:p></o:p>

Routine human errors have no place in DeFi, thanks to smart contracts. This greatly helps in minimising the financial crisis which occurs owing to the mismanagement of central banks and third-party intermediaries.<o:p></o:p>

Instant lending access<o:p></o:p>

Prior to the existence of DeFi, for availing of any loan, one had to physically go to the bank and had to undergo a tedious loan sanction process.&nbsp; However, this is not the case anymore with decentralised finance. With DeFi, one can receive a loan with only a few clicks as the growth of peer-to-peer lending and borrowing solutions has been significantly aided by this new-age technology.<o:p></o:p>

Security<o:p></o:p>

Financial data, which is one of the most sensitive information across the world, can now be safely stored with the help of DeFi. Here, data can be stored on hundreds or thousands of different nodes, thereby preventing hackers from attacking or breaking into the system to gain control. Its consensus protocols prevent any one participant in the system from harming the entire network.<o:p></o:p>

A majority of risks associated with the DeFi project are related to the technology (blockchain) they are built upon. 

<h3 class="MsoNormal" style="text-align: justify;">A few of the cons related to DeFi include:<o:p></o:p></h3>

Responsibility<o:p></o:p>

DeFi, though free of risks and issues, can still not be held responsible for one’s mistakes. In fact, it transfers responsibility from intermediaries to users. In other words, even if one loses funds by mistake, no one will be held responsible. Hence, creating some tools to prevent human errors and mistakes is strongly needed in the DeFi space. <o:p></o:p>

Smart contract problems<o:p></o:p>

Smart contract vulnerability also poses risks to several DeFi projects. If there is the slightest flaw in the code of a smart contract, it can lead to a loss of funds.&nbsp;

<span style="font-size:12.0pt;line-height:115%;
font-family:&quot;Calibri&quot;,&quot;sans-serif&quot;;mso-ascii-theme-font:minor-latin;mso-fareast-font-family:
Calibri;mso-fareast-theme-font:minor-latin;mso-hansi-theme-font:minor-latin;
mso-bidi-theme-font:minor-latin;mso-ansi-language:EN-US;mso-fareast-language:
EN-US;mso-bidi-language:AR-SA">Though decentralised finance has its own share of pros and cons, however; undoubtedly, its advantages outweigh the disadvantages. In fact, the conventional benchmarks of financial services are poised to be transformed by decentralised finance, which has quickly emerged as a promising technology.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <span style="font-size:12.0pt;line-height:115%;font-family:&quot;Calibri&quot;,&quot;sans-serif&quot;;
mso-ascii-theme-font:minor-latin;mso-fareast-font-family:Calibri;mso-fareast-theme-font:
minor-latin;mso-hansi-theme-font:minor-latin;mso-bidi-theme-font:minor-latin;
mso-ansi-language:EN-US;mso-fareast-language:EN-US;mso-bidi-language:AR-SA">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<o:p></o:p>

Decentralised finance is gaining a lot of traction as this is one of the fastest-growing sectors in the blockchain space. 

DeFi is based on secure distributed ledgers and avoids middlemen

It uses uses cryptocurrency and blockchain technology to manage financial transactions

It is permissionless, tranparent and offers instant lending access

An explainer on Decentralised finance (DeFi)

What is decentralised finance? Know its benefits

What is decentralised finance? 

While the conventional system of centralised finance still rules the roost, blockchain technology has given developers the opportunity to explore a decentralised way to manage a financial system and that is called decentralised finance. DeFi is still in its nascent stage and developers around the globe are working together to improve this form of technology. This section will cater to the latest news and developments from the world of Defi.&nbsp;

Decentralized Finance (Defi) News: Find and read latest news, articles on Defi. Check top headlines, videos, photos and breaking news on Defi, decentralized finance.