Bahaa Abdul Hussein is a Fintech expert and shares his experiences with his audience through his blogs.

We live in a world where centralized authorities are no longer a given. From FileCoin to Golem, decentralized finance (DeFi) is rising. But with more eyes on DeFi, comes greater scrutiny.

Projects were often built on trust and community participation. But as the space has grown, so have the scams and hacks. The latest example is the $31 million hack of Bancor Protocol in July. So why is DeFi no longer defiable? And what can be done to make it more secure?

What is Decentralized Finance?

Decentralized finance (DeFi) is the term given to a growing category of financial services that are built on top of public blockchains. These services allow users to interact with each other directly without needing a middleman or intermediary.

One of the key benefits of DeFi services is that they are built on trustless, decentralized networks. This means that users can interact with each other without having to worry about trusting a third party. Instead, all interactions take place on the blockchain, which provides a layer of security and accountability.

Benefits of Decentralized Finance

  • Increased Security: By eliminating the need for a third party, decentralized finance increases security and reduces the risk of theft or data corruption.
  • Reduced Fees: Decentralized finance eliminates the need for high fees charged by centralized intermediaries.
  • Greater Accessibility: Decentralized finance allows anyone with an internet connection to participate in financial transactions.
  • Increased Privacy: Decentralized finance provides greater privacy than traditional banking systems.
  • Faster Transactions: Decentralized finance allows transactions to be completed more quickly than traditional banking systems.

Why is decentralized finance no longer defiable?

In the past, decentralized finance (DeFi) was considered a niche corner of the financial industry with limited mainstream adoption. However, several recent developments have pushed DeFi into the mainstream.

The increasing popularity of cryptocurrencies such as Ethereum has expanded the potential user base for DeFi platforms. In addition, unprecedented monetary policies and low-interest rates have led to a search for new investment opportunities, leading more individuals to turn to

DeFi protocols for high yields and alternative options.

An influx of investment in venture capital and accelerator programs has supported further development and adoption of DeFi solutions. As a result, decentralized finance is no longer seen as a fringe idea but rather as a legitimate and rapidly growing sector of the financial industry.

What’s Next?

The ecosystem of decentralized finance (DeFi) is still in its early days, with a wide range of projects built on Ethereum that show immense promise. However, as the sector has grown, so too have the number of hacks and scams.

We hope this article has helped you understand the Defi space better and shown you why we think it is still an exciting area to be involved in. This has led to many people wondering whether DeFi is no longer defensible. While it is true that there are some risks associated with DeFi projects, the potential rewards outweigh these risks.

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