For the most part of recorded human history, finance has been constantly evolving and adapting to the needs of human culture and lifestyle. Fintech (financial technology) has changed the face of the financial industry. From mobile payments to lending and personal finance management, fintech has completely changed how we interact with our money. Importantly, fintech is not just limited to banking and credit. It has also made things like saving, investing and credit scoring easier for the average consumer. Nevertheless, fintech today is largely centralized and is thus unable to accommodate Web 3.0 and other blockchain-based innovations such as DeFi. What Is DeFi? According to many proponents, DeFi or decentralized finance is an evolution of fintech set to take financial markets by storm. With a steadily growing market cap that is currently estimated to be USD 115 billion, DeFi applications are already demonstrating that they can accomplish the objectives of legacy financial systems but in a manner that is faster, cheaper, and better by leveraging blockchain. This has made it an attractive space for investments and funding from venture capitalists. The sector boasts a total locked value (TVL), a metric to denote the value of assets currently locked in, of USD 92.3 billion in January 2022 and a record high funding of USD 17 billion from VCs. DeFi aims to bring the convenience of peer-to-peer (P2P) transactions to its users by harn...
