“DeFi: What does the future hold?” is the title of the panel held during the BlockDown online conference.
The topic is thus the role of DeFi, which is increasingly establishing itself in the blockchain industry as an alternative to traditional systems. But when mass adoption?
Panel speakers included Stani Kulechov of Aave, Kevin Sekniqi of Ava Labs and Loi Luu of Kyber Network, so three representatives of decentralized finance, who also discussed the Ethereum issue, trying to understand whether it can be sustainable for this blockchain to support the entire ecosystem in the long term.
After an introduction on what the various protocols are and how sometimes they also collaborate with each other (Aave uses Kyber), they spoke about the slowness of some decentralized systems, an aspect that surely needs to be solved and that affects the adoption of these protocols.
The security of DeFi
Safety is another thing to be very careful and educated about because, as demonstrated by the Maker DAO case in March, the sector still has few guarantees. An increasing number of companies like Aave test and audit their codes. DeFi is certainly still immature when it comes to security, partly because many dApps rely on third parties, such as Maker DAO.
Everything is open and public, which means that it is true that DeFi allows users to check everything, but it is also true that these processes take time.
What could help DeFi to achieve mass adoption in the future?
According to Sekniqi, the real problem is not so much security, but the fact that infrastructure and protocols are difficult to understand and use. Many people use them but without really knowing about the technology, so it is a risk and an entry barrier for many.
Of a similar opinion is Luu, who explained that even just the nomenclature of some concepts is difficult for ordinary users.
All DeFi dApps are practically interoperable with each other by default, so it is easy to use them together, contrary to what can happen in the centralized finance sector, which is why there is often mention of DeFi Lego.
For this reason, Kulechov said that he thinks that in a couple of years all protocols will work together automatically even, for example, to make lending more profitable. This will also make DeFi tools easier to use, of course. And maybe the UX of some applications could be improved too, according to Aave’s CEO.