The Mind Behind Helium: Shawn Fanning

Born in November 1980, Shawn Fanning is an investor, entrepreneur, and computer programmer well known for co-founding Napster. Fanning also served as the lead software developer of the project. In 1999 he designed Napster, one of the first P2P (peer-to-peer) platforms for sharing files. Napster became so popular worldwide that he appeared on the cover of Time magazine.

In 2001, the initial free peer-to-peer version of the platform was shut down. The company appealed in court against various orders for encouraging illegally sharing copyrighted material. After these events, the site decided to install a paid subscription version. 

Following his participation in Napster, Shawn Fanning decided to invest and join a series of tech-oriented companies. Since then, he has been involved in the early stage of several startups such as Snocap, Path, and Helium.

The Beginnings of Shawn Fanning

He was born in November 1980 in Brockton, Massachusetts. In 1994 at the age of 14, Fanning met over the internet with Sean Parker,  his future partner. In the beginning, the pair bonded over topics such as physics and hacking, and then they met in real life. 

Shawn attended Northeastern University, and in 1998 he developed the code for what would be one of the most popular P2P sharing platforms. In this project, Parker was the one in charge of raising funds to build the platform. They called it Napster. 

Napster

In June 1999, a beta version of the program was released. Hundreds of students attending Northeastern University started using it to share music. Right after the project’s initial success, the founders moved the headquarters to California and hired employees to work on the development of the program. 

Napster became so popular beyond the university community that Shawn Fanning featured the cover of Time magazine. Soon after that, millions of users started downloading all kinds of files through the platform.

However, the company’s success was overshadowed by the numerous lawsuits. The Recording Industry Association of America was entirely against the project, as many bands and artists were. In the end, the resolution for all the feuds was Napster shutting down for good. 

Despite the company’s closing, Napster had a lingering impact on the music industry that we can still witness and enjoy to this day. The project served as inspiration for thriving services like Spotify and iTunes. Ultimately, the success with Napster earned Shawn Fanning a position on the list of top 100 innovators under 35.

Shawn Fanning’s Ventures

After the Napster project, Fanning invested and joined a few tech-related startups. Such ventures include Rapture, Path, and Snocap. Shawn co-founded Snocap alongside Jordan Mendelson, who had worked at Napster before. A few years later, in 2006, he jumped into developing Rapture and became the firm’s CEO in 2007. By 2009 he was starting yet another company named Path.com.

Another vital investment to mention is his participation in launching Uber in San Francisco in June 2010.

Helium

In 2013 Shawn Fanning started a company called Helium Systems with Sean Carey and Amir Haleem. The company announced that the team had obtained $16 million in funding from Khosla Ventures. Other funding participants were FirstMark Capital, Mar Benioff, Digital Garage, SV Angel, and Slow Ventures.

Helium is now selling software and hardware for companies that want to keep a closer eye on their processes. Therefore, it’s not a surprise that the company has been thriving since it was founded. In 2020 their 5G project expanded in the US and started colonizing Europe. 

Now, Helium partnered with Dish, and hotspots are expected to be set all across the US and expand to the rest of the world. Founders claim that most of the profits they make nowadays are mainly from services on top of the network, and a lot of the value of the project is in the ownership of the Helium crypto.

From an early age, Shawn Fanning showed a spark for tech. Later on, throughout his education years, he started surprising the world with his innovative ideas. Today, he’s an accomplished tech entrepreneur with his sights set on the future. We at CryptoDigest cannot wait to see what other innovations this tech visionary will bring us next.

Plasma Finance: The Next Big Thing in DeFi

In the last couple of years, the DeFi sector has grown significantly, paving the way for innovative protocols such as Plasma Finance. With a worth that surpasses the $270 billion mark, the DeFi projects have consolidated their position in the crypto space. Now, with Plasma Finance in the game, the projections for the industry are skyrocketing rapidly.

In spite of the increased interest in DeFi, it’s still only a niche sector, but Plasma Finance is now addressing the issue. The platform’s goal is to offer a streamlined and simplified experience for the user. The network utilizes DeFi protocols while offering analytics tools and some added features. By combining all that, the network gets the best of both worlds, DeFi, and traditional finance.

What Is Plasma Finance?

There are many inconveniences people face with all the intermediate steps for getting into DeFi. This is where Plasma Finance saw an opportunity. As a result of these limitations, we can conclude that there’s only so much growth that DeFi can have. There are a lot of users wanting to experiment with lending and yield farming, for example, but currently, it’s too complicated for newcomers. 

Plasma Finance offers a solution that would lower the barriers to getting into DeFi. The protocol supplies an interface to store, invest and manage DeFi crypto. 

What Does Plasma Finance Do?

Its most significant feature is to support payment cards issued by Mastercard and Visa, as well as bank accounts. One of the goals for the network is to offer top rates from major exchanges, and at the moment, it supports multiple crypto assets. 

It is possible for Plasma Finance to support those payment methods because of its partnerships. The collaborations are what makes the global support possible. The protocol’s most important partners are PlasmaPay, Ramp, and Simplex.

New Users

Ilia Maksimenka, current CEO and founder, thinks that DeFi protocols should compete with traditional institutions. Maksimenka believes that exchanges, banks, and conventional financial institutions are the main competitors since people use them daily.

The key to their success is the ease of using, which DeFi doesn’t possess, and that’s the first issue they’re trying to solve. Research made by the team in charge demonstrates that users benefit from familiarity. They can find it among the established interface models, such as the ones used by traditional services. 

Most users expect to have an experience similar to using an iPhone, but instead, new users find it hard to understand DeFi. That unfamiliarity translates into uncertainty and fear of losing money for the user. 

Advantages of Plasma Finance

The project’s primary goal is to help new users with the onboarding process by simplifying it, making the transition easier. The team worked on a step-by-step approach that starts with the process of downloading a wallet and linking a source of funding to get further access. 

Once the user completes those two simple steps, they’re granted access to the entire experience in one platform. By simplifying the access process, Plasma Finance is helping users from around the world to save time. Instead of researching hundreds of protocols and platforms, users can have it all in one place.

As another crucial point, the protocol provides fiat on-ramps for purchasing crypto in most countries around the globe. It includes a portfolio management tool, swap platforms, and decentralized exchange, among other features. Coupled with this, the team constantly performs audits on projects and labels them accordingly.

Conclusion

It’s safe to say that it will be impossible to ignore the DeFi industry in the following years, specifically by the traditional finance system. Its more efficient and thoughtful processes will make it an outstanding sector, not to mention the difference in rates compared to conventional finance. 

One thing is for sure; if everything keeps going as it has, the most significant protocols might become more prominent. That is the goal for Plasma Finance, to be the “retailer” users go to look at the offers out there. Think about it as a Spotify for the DeFi space and use it accordingly.

The Co-Founder of Ethereum Vitalik Buterin

The programmer Vitalik Buterin who is best known for his Ethereum project has been involved in the crypto industry since 2011. He designed Ethereum to be a platform that works as a worldwide network for DeFi or DApps. Even though that’s his most famous project, Buterin is also famous for writing articles and co-founding Bitcoin magazine. 

In 2013 he traveled around the globe to speak with BTC developers. During his six month trip, he understood that he could build a new, improved version of it. BTC stands as the first crypto in the world, while Ether is a digital currency that is based on the blockchain network of Ethereum.

Vitalik Buterin co-founded the Ethereum project which supports multiple functions. Among those functions is the development of programs and apps with the power of crypto. Also, smart contracts are included in the list, and it’s actually how the platform functions. 

His Childhood

Vitalik was born in January 1994 in Russia, where he lived until the age of six. After that, his parents migrated to Canada in pursuit of a better future for the family. When he was in third grade, he was acknowledged as a gifted child and was placed in a program to develop his skills.

When he was in the program, he discovered his talents that made him stand out. His skills mainly focused on programming and mathematics, although he also had an interest in economics.

Even though he was considered a genius from a very young age, his social skills were not as developed. He went to a private school in Toronto, where he acquired a new perspective on education. While being there, he developed a hunger for knowledge, his education became his main goal at the time.

Vitalik Buterin’s Student Life

In 2011 when he searched for a new direction in his life, he came across Bitcoin. In the beginning, he was a bit skeptical about the value of BTC; he wasn’t able to see how it was possible without any backup. As time passed by, his fascination about the project kept growing; the more he learned, the more he wanted to know. 

Naturally, he wanted to be part of the team in charge of this new economy by getting some tokens. Unfortunately, at the time, he neither had the power to mine them nor the money to buy BTC. Eventually, he started writing articles for about five tokens each. Not only he went into the technological aspect of it but also the economic and political aspects. 

In late 2011, his articles got the attention of another Bitcoin enthusiast; eventually, together, they founded Bitcoin Magazine. He quit university since he was too busy traveling the world and developing various crypto-related projects.

The Lightbulb 

After spending a lot of time searching through different projects, he realized that they were too specific for certain uses. Because the protocols weren’t broad enough, he understood there was an opportunity to create a new one. He realized that it was possible to generalize massively what the protocols did. That was an option by changing the functionality with another language of programming. 

We’re talking about the Turing-complete programming language, which allows a computer to solve any problem, if there is the right algorithm, as well as enough memory and time. When his idea got rejected by people in charge of other already established projects, he made the decision to do it himself.

Ethereum is Born

Vitalik Buterin explained his idea in the white paper, which he sent to a few people. That resulted in over 30 people reaching out to him to talk the concept through. In the beginning, Ethereum was only a digital token. As time passed, the idea around it evolved, and by January 2014, the team in charge made core changes. A few months after this, Buterin presented Ethereum at the BTC conference. 

Later on, the team decided to hold an initial Ether offering. By doing this, the network would be able to fund its development. They raised over 31,000 Bitcoin from the sale of Ether, worth about $100,000 at the time.

After that, they established the Ethereum Foundation based in Switzerland. The foundation’s main task was to oversee Ethereum’s software development. Although they had some turbulence, the campaign was successful. After all, Ethereum’s principles, such as universality, simplicity, and agility make it an appealing option for investors.

Conclusions

Vitalik Buterin is, without a doubt, one of the biggest influencers these days. His ideas have proven to be successful, as they make progress not only in the tech field but in the economic one too. For sure, this won’t be the last time we hear about this tech genius and his innovations.

How to Create a Stable Income by Staking Crypto

Staking Explained

There are proof of stake networks such as Polkadot and Ethereum that are rewarding users for staking crypto. Unlike Bitcoin, secured by mining, more recent crypto utilizes a different mechanism of consensus. That other mechanism, known as PoS (proof of stake), uses crypto assets to validate transactions. It means that users commit their crypto to the network to aid the blockchain. In return, the users get rewards, usually in the form of the same crypto they have staked.

In simple terms, a blockchain is a database of transactions that don’t rely on a central authority for maintaining them. Some blockchains, such as Bitcoin, use mining for securely validating the transactions. The problem with mining is that it implies high electricity consumption and expensive hardware. Therefore, this option is not within reach of most people. 

Networks like Cardano, Polkadot, and Ethereum 2.0 changed all of that to avoid complications. Staking is the newly implemented mechanism based on committed funds. This new mechanism gets rid of the mining hustle. Proof of stake chooses validators based on the amount of crypto held in a node. Other users can delegate the assets, or the validator can stake them. 

About the Validators

Staking can be financially enticing; just like miners, validators also get rewards in cryptocurrency. The reward is earned when they stake the asset, and whoever delegates crypto to the validator also receives a portion. The portion of the reward is based on how much they’ve staked minus the validator’s share. This can be particularly attractive for investors who hold assets instead of day trading them, regardless of how small they may be. 

One of the main advantages of staking is that even though complex math supports it, it requires very little tech knowledge. All of the mentioned elements combined make it a more accessible option for most people. Therefore, it’s expected that its growth will be even faster as more people who try it spread the word.

Ways of Staking Crypto 

In general terms, there are two options for staking crypto. The first, as mentioned before, as a validator running a node on your own. If you decide to plunge into this option, you should know that it requires a bit of effort. A stable and secure infrastructure is a must, as well as having experience. Also, the minimum of coins needed to stake is usually too high. For example, to be an Ethereum 2.0 validator, it’s required to have at least 32 ETH.

Because of those reasons, among others, staking is more commonly done by delegation. You choose to delegate your crypto to a validator that already has the required setup. This way, the validator is the one doing the work of keeping the node running for you. In return, the validators will take commission from the staking rewards. 

It should be noted that by delegating your coins, you’re not handing over their guardianship to the validator. Your assets remain in your custody all the time, and usually, the rewards are reinvested automatically. 

The Exchanges

The majority of exchanges handling crypto run validators; this enables their users to stake with them. To do so, they have to use the user interface of the exchange. Among the major ones are Binance, Coinbase, Bitfinex, KuCoin, Kraken, OKEx, and Okcoin. Typically the staking process on exchanges is very similar. What differs one from the other is the available crypto for staking, the locking period, and their fees. 

Despite all of this, not all big exchanges enable users to do staking. Some like Gemini and Robinhood don’t have it as an option right now but have stated that they may offer it in the future. 

Other Things to Consider

Also, it would be best to consider that to comply with regulations, some exchanges might not allow you to stake. This option may not be available for you if you live in particular jurisdictions such as Hawaii or New York. As usual, we encourage you to read more about the subject, especially if you’re considering investing in it. 

Remember that even if it takes longer to take action, it’s always better to make a fully informed decision. A decision taken in the heat of the moment without enough information can potentially lead to considerable losses.

USDC to Challenge Tether

The company Circle Internet Financial, Inc. has big plans to make USDC challenge Tether, so it earns the title of  the best stablecoin. Jeremy Allaire has stated that he wants USDC to challenge Tether and has big plans to make it happen. The CEO of Circle wrote in a blog post that the company’s mission is to become a federal bank. The projections expect  that USDC, the stablecoin that the site operates, will grow its circulation into potentially hundreds of billions of USD. Currently, stablecoins are having a significant moment because they are pegged to a fiat currency, which makes them more stable, therefore, more trustworthy. 

The Background

New investors all around the world, as well as experienced crypto traders, are embracing stablecoins. They have become a good option since they are considered a better-structured alternative for moving money from one place to another. 

The Plans for USDC to Challenge Tether

Currently, Tether is the one dominating the stablecoin markets. Besides Tether, there are several other options out there, but that only seems to be an opportunity for Allaire. When considering market capitalization, USDC is second to Tether. It’s expected that it will take the lead when the regulators in the United States start scrutinizing the uncommon accounting practices of Tether. So eventually, his plans for USDC to challenge Tether will come down to regulations set in place at the time.

How Stable is this Stablecoin?

The main advantage of stablecoins is that they’re not as volatile as other blockchain currencies. For many companies that mine them, stablecoins offer a fast and easy way of generating revenue. When users pay stablecoins in USD, corporations such as Circle and Tether use that money as a backup for them. For example, Circle stated that USDC operations are expected to generate $40 million this year.

The problem comes when companies decide to place the reserves in commercial paper or bonds. So stablecoins such as USDC end up not being backed up 1 to 1 as companies promise. Such was the case of Circle.

Circle’s Battle 

Circle is planning to go public soon, which means that convincing investors that USDC is safe to invest in is crucial  at this point. The company announced  its intentions to become a federally chartered bank, which could help with the regulation issues they face. However, they are confident that their future is bright.

Is It Possible to Ban Bitcoin?

Since the inception of Bitcoin, there has been an opinion that countries around the globe would ban the cryptocurrency, and it is only a matter of time. First of all, Bitcoin is often considered a threat to fiat currencies, with the capacity to affect the control of financial institutions over the monetary supply. As this cryptocurrency has an anonymous nature, there is a concern that Bitcoin facilitates money laundering, drug trafficking, and ransomware. However, it depends on a country whether it is possible to ban Bitcoin. 

It is worth noting that the use of Bitcoin has already been prohibited in different regions. At the moment, some countries place a complete blanket ban on Bitcoin. They restrict the ownership and use of cryptocurrency. Among these countries are Egypt, Nepal, Ecuador, Algeria, and Pakistan. Also, Taiwan and Saudi Arabia implemented a partial ban on the use of cryptocurrency; the governments of these countries prohibit financial institutions from dealing in Bitcoin and carrying out Bitcoin transactions. 

In 2021, China has been the most aggressive towards the use of Bitcoin of all countries that expressed their negative attitude towards cryptocurrency. China has introduced restrictions on Bitcoin mining; the country forced miners to cease their activities. The People’s Bank of China introduced an edict to transaction platforms and banks that ordered them to stop all the operations with the cryptocurrency. 

Prior to mining restriction, China was in control of almost two-thirds of the worldwide Bitcoin mining industry. This restriction resulted in a mass exodus of miners, and crypto exchanges stopped servicing Chinese customers. Also, all crypto-related accounts were terminated by the Chinese social media network Weibo. Nevertheless, some people in China can still access foreign crypto exchanges by means of using VPNs. 

Meanwhile, in spite of the slump following China’s ban on mining, Bitcoin’s mining hash rate has recovered. While Bitcoin’s pre-ban height of price is still recovering, it has noticeably increased since August 2021. 

Even though governments can issue edicts that prohibit Bitcoin, the enforcement of such a ban would be quite complicated. Unless the government controls the use of the Internet, people would be able to use Bitcoin wallets, complete transactions, or run a node. It is certain, as there many Bitcoin users in the countries that have already prohibited its use.

Bitcoin Halving Explained

How Does Bitcoin Limit its Supply?

In the mining world, it’s well known that Bitcoin has a limited supply of 21 million tokens, and Bitcoin halving happens every few years. But what is Bitcoin halving? In simple terms, it’s the event where the rewards given to miners are cut by half. This event, following Bitcoin’s pre-set rules code, should happen every four years. That means that the amount of Bitcoin tokens distributed to the miners as rewards halves.

About the Supply

In order to understand halving, first, we should understand what the theory of the supply of Bitcoin is about. Satoshi Nakamoto, the mastermind behind Bitcoin, strongly believed since the beginning that scarcity creates value. It can be compared to there being only one Mona Lisa, which makes it more valuable than if there were several of them. The same thing happens with the amount of gold worldwide; because it is limited, its value increases.

Based on that same principle, Bitcoin became the first revolutionary digital asset by making it scarce. There will only be 21 million coins of Bitcoin ever issued and distributed. This limiting strategy of BTC is totally the opposite of the principles of how fiat currencies work, such as the USD. In the beginning, the US dollar had a certain amount of backup in gold as a reserve. That is a concept known as the gold standard. As time went by, those rules adapted so economies could print more money, and they could stimulate economies in need. That way, governments can print money every time they need to. 

What is Bitcoin Halving?

First, we have to clarify that mining is the process through which new Bitcoin is minted as a reward for blocks. Miners are in charge of securing and maintaining the ledger of Bitcoin, and in exchange for it, they get Bitcoin. Still, every four years, said reward gets reduced by half; therefore, the term assigned to it is “halving.” Each Bitcoin halving event minimizes the number of new coins in the supply until 2140, when the last Bitcoin will be minted.

What Makes Halving Unique?

Since Bitcoin is decentralized, which means no one controls it, it needs a great set of rules. One of the most important rules is how many Bitcoins get minted and how they are released and distributed. The halving event occurs every four years, the whole system is set in stone and basically impossible to change. Specifically, that rule makes Bitcoin practically hard money, like the case of gold, which has a limited supply almost impossible to change.

The Impact it Will Have on the Price.

There are different opinions about how halving will impact the price of the crypto. If we go by the book, in theory, because of supply and demand laws, the fact that the supply is limited should increase the price. Although, some experts claim that it could potentially have the opposite effect based on the history of Bitcoin halving events. Not only by stalling the price but actually crashing it.

What Can We Expect From Ethereum 2.0?

The Background

Like Bitcoin, Ethereum uses “mining” to make and distribute new coins; Ethereum 2.0 will come to end that. The people worldwide who make mining possible, a.k.a. miners, work with equipment worth millions of dollars. Miners require sophisticated machinery to have a real chance in the race of solving mathematical problems to earn ETH. The process has become a concern due to its energy-intensive consumption and its impact on the environment. But apparently, this won’t be a concern for much longer. Next year Ethereum will go under a significant upgrade that will change how it operates and how its coins are minted. So, mining Ethereum as we know it will become only a part of history. 

What is Ethereum 2.0?

Ethereum 2.0 is a set of upgrades that are interconnected, planned, and designed to help it become more scalable, sustainable, and way more secure. Several teams within the community have been working on building the upgrades necessary to make this happen.

From PoW to PoS

Since the beginning of Bitcoin, proof of work has been the concept used to make decentralized networks safer for money transactions. In 2015, when Ethereum was launched, they adopted the same protocol. In simple terms, PoW is the algorithm, and mining is the action itself, attaching the right blocks to the chain. Now that the teams have been putting effort into changing the protocol from PoW to PoS since it requires remarkably less electricity. Another advantage of it is that it will also enable a much larger volume of transactions. It will be more secure since attacks can be prevented from happening. Finally, mining will be completely turned off when the PoW and PoS chains are merged, and Ethereum 2.0 is all in. According to Tim Beiko, Ethereum developer, this can possibly happen before next year ends. 

What Will Happen to the Miners After That?

Experts say it will not be such a big problem; once the merge has been completed, they believe that miners will go for either one of two easy choices. Once Ethereum 2.0 starts operating entirely, there will be divided opinions about which way to go. The most obvious options are Ravencoin with a market cap of $436 million and Ethereum Classic with $4.7 billion. Another significant change is the way miners get paid; no more transaction fees will go to them, only the newly minted coin as a reward. Although not all of them will endure, those who will keep mining ETH will have it  since they will become easier to obtain.

Are People Ready for This?

If it’s true that the news about Ethereum 2.0 is a matter of public domain, not everybody involved has done something about it. Some might have done more or even better than others to prepare for the change. It’s also true that some pools have stated their position against the merge, which also impacts the general opinion of the public, traders or not. If Ethereum 2.0 can deliver all that has been promised, it’s still yet to be seen. Although one thing is for sure, if they succeed, this will imply an astronomical jump for the protocol that could potentially cause a chain reaction with other protocols of the exact nature, but what would happen with the PoW protocols? That is still left to be determined.

Last Bitcoin to Be Minted Around 2140

The Background

What will happen after the last Bitcoin has been minted? Since the emergence of Bitcoin, it was stated that the maximum amount of coins to be minted was as high as 21 million. So, what will happen after that? That’s what many traders, as well as miners, are beginning to wonder. What’s next? Once the supply has reached the maximum level, the miners will not longer receive block rewards, at least not the way they received them so far. Miners will be rewarded with fees from transactions, and this considering that there are no significant changes in the protocol of Bitcoin until then. 

There will only ever exist 21 billion coins of Bitcoin. When the last Bitcoin has been mined, which is predicted to happen sometime around 2140, there won’t be anymore Bitcoins entering the circulation. The principle that the blockchain of Bitcoin was created around is that of a controlled supply. It means that there’s already a fixed amount of new coins being issued each year until the grand total of 21 million coins has been reached. Once this happens, the network, in general, will keep operating the same way, except the significant change for miners.

The Miner’s Reward

Every ten minutes or so, the miners who work with Bitcoin discover a block. They solve the puzzle of cryptography that enables the miner to attach a new block to the blockchain. Every block is formed by a bunch of records of transactions waiting in the pool of memory of Bitcoin. They get chosen often because of the size of the fee they can bring to miners. Every time a miner discovers a block, they receive an established amount of Bitcoin for their contribution. That is known as the “block reward.” 

First, the reward was 50 Bitcoins, but every time 210,000 new blocks are discovered, the reward gets cut by half. That happens more or less in a time frame of four years. The reward has already been cut a few times, first to 25 BTC, then 12.5 BTC to currently be at 6.25 BTC. The last cut happened in May 2020, and the next one is expected to occur in 2024. 

So What Happens After the Last Bitcoin?

After the last Bitcoins have been issued, miners will be able to keep participating in the process of discovering blocks. The main difference is that the reward will not be the same, but there will still be a reward for them. The miners will receive a fee spent on the transactions in every new block. They currently make as little as 6.5% of revenue out of those fees, but by 2140, it should go up to 100%.

Will this disincentivize people from mining? Only time will tell. For now, miners are taking advantage of the situation while they still can do it. Until the day that the last Bitcoin gets minted, something is for sure we still have a long way to go, and many things can change. Nothing is set in stone, especially when it comes to technology development. But bottom line, it seems more and more real that crypto has come to stay with us.

The Capital Market Revolution, Decentralized Finance

With smart contracts and blockchain involved, decentralized finance has become an excellent alternative to the most common financial services. They have proved they are great at updating, improving, and globalizing finance. 

Until recently, we’ve been living in a centralized world because institutions are in charge of the access to capital markets and the issuance of currency. For example, to access the traditional capital markets, one must go through a financial institution authorized to do so, like a bank. That same institution will be the one centralizing all the information and will have the power of the clients’ assets.

The entity through which we have accessed the capital market is also registered in a centralized registry that allows it to access it. In other words, the entire financial system in this process is centralized. Even when we purchase on any platform to buy and sell goods or articles, the information is centralized. The same happens every time we make a payment through any application or means of payment. In the traditional capital market, the entire financial system is centralized. All the information, payments, purchases, sales of goods or articles, are centralized in records of the control agencies. 

Available Alternatives

They are nothing more than financial systems without the need for intermediaries. Decentralized finance is an excellent alternative to traditional financial services supported by smart contracts. That came with the intention of updating, improving, and globalizing classic financial services. 

DeFi is a set of rules and protocols that, thanks to blockchain technology, decentralize the financial system as we knew it before. In this case, the information flows without needing an institution to give its approval. The users themselves are the ones who safeguard their assets.

Final Thoughts

It is no longer necessary to make payments through banks or companies that provide payment services. It is also not necessary to lend money or invest through entities that centralize these activities. DeFi technology is here to stay, creating greater freedom for users to use and safeguard their money. In addition, thanks to the different investment platforms, people can access this type of service more efficiently and in just one click.