Advantages and risks of decentralized finance

Decentralized Website

In short, if we want to frame the question with the aim of answering the questions we asked ourselves at the beginning of this article, these characteristics of decentralized finance are evident , some positive, others more configurable in the category of “risks” : it promises easy profits and this always involves risks; it offers real opportunities for all those people who, for one reason or another, are cut off from the circuits of traditional finance, for example for all those who do not have a bank account; its transparency is verifiable; it is the subject of constant innovation ,it is difficult to use and does not guarantee any kind of legal protection transactions are slower than those of centralized finance decentralized website.

 A financial world without particular rules, in which you can win or succumb, in short.

In short, DeFi allows, at least to a certain extent, access to financial instruments without the difficulties that exist in the traditional financial system and does so in an open and, indeed, decentralized way. At the same time, dangers are just around the corner for decentralized finance . From hackers to traditional scammers who use DeFi tools to take advantage of the naivety of those who fall into their meshes, Decentralized Finance is not safe from risks and dangers.

Furthermore, since Decentralized Finance is still in a phase that can be defined as experimental even technologically speaking, nothing guarantees us that sooner or later a big flop will not happen.

Decentralized Website

There is no lack of those who condemn Decentralized Finance tout court and those who even went so far as to compare it to the Ponzi scheme. What is certain is that the growth of DeFi is exponential and exciting. Nonetheless, some traders think of the danger that yet another “bubble” may occur precisely because of this, or that some investors, not reacting promptly and not catching any negative signals, fail to use their resources effectively and lose even before invest, remaining, as they say, with the proverbial match in hand.

A new action is fueling attention in the cryptocurrency sector despite the evidence that their prices are still far from the peaks reached . It is called DeFi , quick for Decentralized Finance, and utilizes blockchain , reasonable agreements and / or cryptocurrencies to furnish financial services to consumers, such as loans, expenditures, remittances, results or interests.

Decentralized finance, to date, is still in its infancy and is far from reaching the levels of classical financial systems. Bitcoin and Ethereum are prime examples of decentralized finance. Both are controlled by large computer networks, not by a central authority. Many investors think of bitcoin as gold, which is a store of value, an investment that protects against inflation.

However, it is the new projects that make the concept of DeFi even more interesting. The Dai stablecoin, for example, is a bitcoin like a digital card that strives to be a common cash inaccessible by central jackpots. Different bitcoin, its importance is pegged to the US buck, drastically diminishing the volatility that precludes bitcoin from existing logical for ordinary properties.