Anthony Pompliano revealed that many DeFi projects are actually based on Amazon AWS.
The point is that the term DeFi stands for Decentralized Finance, and in turn the term “decentralized” means the absence of a Single Point of Failure (SPOF), i.e. a single part of the system whose failure can lead to anomalies or termination of service.
In other words, a platform should not be defined as “decentralized” if it has even a single SPOF.
In fact Pompliano writes:
“Jeff Bezos could shut down most of these Ethereum-based “DeFi” apps by simply shutting off AWS. You’re not decentralized if you just spin up servers with Uncle Jeff!”
Jeff Bezos is the founder and CEO of Amazon, and AWS is a hosting service offered by Amazon.
In other words, Amazon has complete and arbitrary control over AWS servers, so it would have full power to intervene for example to block any platforms based on them.
The Ethereum network, instead, is not based on hosted servers, but on nodes that anyone can freely install on their own machines, if they have the resources and are able to do it.
Therefore while the Ethereum network is considered without SPOF, the same could not be said of many DeFi platforms based on its blockchain.
According to Pompliano there are many DeFi platforms that use, in addition to the Ethereum blockchain, hosted servers, in particular through the AWS service provided by Amazon.
In these cases the SPOF would be precisely the hosting, able arbitrarily or unintentionally, to interrupt its operation.
If this was the case, it would be absolutely wrong to call these platforms “decentralized”, which would therefore not be DeFi protocols at all.
Sometimes the term DeFi is used more for propaganda purposes than to indicate a special technical characteristic, namely that they are decentralized and therefore unstoppable protocols. In such cases a good dose of caution would be appropriate when relying for example on such platforms.