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Decentralised Finance (Defi) apps are starting to gain traction on Ethereum. Theres about half a billion in funds currently making use of them. https://defipuls

by flarex 7y ago

Decentralised Finance (Defi) apps are starting to gain traction on Ethereum. Theres about half a billion in funds currently making use of them. https://defipulse.com https://defipulse.com

arcticbull 7y ago
Even those are mostly exchanges (speculation), derivatives (extra speculation) and stable coins (to enable speculation on exchanges which want to avoid AML and KYC in the facilitation of money laundering).
- flarex 7y ago
  Whether you agree with the use cases or traction they're gaining doesn't negate that there's a lot of others that do find them useful.
  - arcticbull 7y ago
    That's totally fair and I only call it out because in my original post I said "other than speculation and money laundering" (which I freely admit is a big use case) and you provided me a list dominated by speculation and money laundering.
    - flarex 7y ago
      Maker and Compound both support interest and borrowing which are what you'd find in a traditional bank (at much worse rates). The money laundering argument could be applied to anything that can't be controlled by governments. Unfortunately there are many countries where monetary policy is oppressive so Defi finance is a legitimate alternative. Just because technology can be abused doesn't mean that it shouldn't be used. See the internet etc.
      - bananabreakfast 7y ago
        You're completely missing the point raised though. They said there are no real uses of this technology outside of speculation and laundering and your response is that tools for speculation and laundering are useful. That's not really what the argument is here. The argument is that this technology is being touted as diverse and widely popular when it in fact is not and mostly only used in circular use cases involving itself.
        flarex 7y ago
        No I just said you can use it for saving and borrowing which have nothing to do with speculation or money laundering. Also it’s impossible to tell what percentage of transactions are related to money laundering in crypto and you can’t outright dismiss legit use cases because of this.
    - rolltiide 7y ago
      The opposite of anti-money laundering (AML) isn’t actual money laundering AML implementation is a poor and misapplied user experience that is usually done as an excuse to prevent money laundering. Many services apply it arbitrarily with no scrutiny and use it to steal users funds. Unclear regulations per country dont help and unscrupulous actors take advantage. Onchain and noncustodial services are either exempt or function autonomously, removing this particular duty of the state. They also typically have unlimited amounts that you can move, compared to arbitrary monetary amounts that centralized systems impose. “DeFi” efforts are being made to make the experience of using onchain noncustodial services as fast or faster than offchain custodial services and a lot of progress has been made towards that. Regarding the actual money laundering everyone’s afraid of, even the strictest regulations never actually prevented that while taxing all business and financial institutions. The Patriot Act wouldn’t have flagged any of the 9/11 transactions, HSBC still laundered billions for the actual cartel, minorities go to jail for accidentally using over $10,000 in cash, and even Al Capone could have passed the KYC part of AML regulations, so who is this for? Any way its going to be moot and already is for a lot of people.
- woah 7y ago
  We use the stablecoin Dai for althea.net. There are several networks running providing internet to people with wireless mesh nodes that pay each other with Dai.
  - mirekrusin 7y ago
    Sounds like pied piper.
- DennisP 7y ago
  You quoted "a vibrant ecosystem of banking functions, asset management, trading exchanges, and more" and called it a stretch. Now you're complaining it's just stuff for speculation like exchanges and derivatives. That's literally what the quote said was there. A popular asset management system is this: https://www.tokensets.com/ https://www.tokensets.com/ Maker and Compound allow borrowing backed by collateral. Decentralized exchanges include the various DEXs and Uniswap. All of these get substantial usage.
- bitreality 7y ago
  Would you say the same thing about cash? Because Dai is the closest thing out there to true digital cash.
  - spurdoman77 7y ago
    Cash is great for money laundering. Much better than crypto.
- derefr 7y ago
  Sure, but they're not speculating on the value of crypto (which is what people are actually concerned about when they talk about speculation.) These apps are just generic infrastructure, like a stock market is generic infrastructure. And, as such, they have value as infrastructure, independent of any of the assets people might list on them; just as a stock exchange has value independent of the ridiculous penny stocks people might list on it.

by flarex 7y ago

Decentralised Finance (Defi) apps are starting to gain traction on Ethereum. Theres about half a billion in funds currently making use of them. https://defipulse.com https://defipulse.com

arcticbull 7y ago

Even those are mostly exchanges (speculation), derivatives (extra speculation) and stable coins (to enable speculation on exchanges which want to avoid AML and KYC in the facilitation of money laundering).

flarex 7y ago
Whether you agree with the use cases or traction they're gaining doesn't negate that there's a lot of others that do find them useful.
- arcticbull 7y ago
  That's totally fair and I only call it out because in my original post I said "other than speculation and money laundering" (which I freely admit is a big use case) and you provided me a list dominated by speculation and money laundering.
  - flarex 7y ago
    Maker and Compound both support interest and borrowing which are what you'd find in a traditional bank (at much worse rates). The money laundering argument could be applied to anything that can't be controlled by governments. Unfortunately there are many countries where monetary policy is oppressive so Defi finance is a legitimate alternative. Just because technology can be abused doesn't mean that it shouldn't be used. See the internet etc.
    - bananabreakfast 7y ago
      You're completely missing the point raised though. They said there are no real uses of this technology outside of speculation and laundering and your response is that tools for speculation and laundering are useful. That's not really what the argument is here. The argument is that this technology is being touted as diverse and widely popular when it in fact is not and mostly only used in circular use cases involving itself.
      - flarex 7y ago
        No I just said you can use it for saving and borrowing which have nothing to do with speculation or money laundering. Also it’s impossible to tell what percentage of transactions are related to money laundering in crypto and you can’t outright dismiss legit use cases because of this.
  - rolltiide 7y ago
    The opposite of anti-money laundering (AML) isn’t actual money laundering AML implementation is a poor and misapplied user experience that is usually done as an excuse to prevent money laundering. Many services apply it arbitrarily with no scrutiny and use it to steal users funds. Unclear regulations per country dont help and unscrupulous actors take advantage. Onchain and noncustodial services are either exempt or function autonomously, removing this particular duty of the state. They also typically have unlimited amounts that you can move, compared to arbitrary monetary amounts that centralized systems impose. “DeFi” efforts are being made to make the experience of using onchain noncustodial services as fast or faster than offchain custodial services and a lot of progress has been made towards that. Regarding the actual money laundering everyone’s afraid of, even the strictest regulations never actually prevented that while taxing all business and financial institutions. The Patriot Act wouldn’t have flagged any of the 9/11 transactions, HSBC still laundered billions for the actual cartel, minorities go to jail for accidentally using over $10,000 in cash, and even Al Capone could have passed the KYC part of AML regulations, so who is this for? Any way its going to be moot and already is for a lot of people.
woah 7y ago
We use the stablecoin Dai for althea.net. There are several networks running providing internet to people with wireless mesh nodes that pay each other with Dai.
- mirekrusin 7y ago
  Sounds like pied piper.
DennisP 7y ago
You quoted "a vibrant ecosystem of banking functions, asset management, trading exchanges, and more" and called it a stretch. Now you're complaining it's just stuff for speculation like exchanges and derivatives. That's literally what the quote said was there. A popular asset management system is this: https://www.tokensets.com/ https://www.tokensets.com/ Maker and Compound allow borrowing backed by collateral. Decentralized exchanges include the various DEXs and Uniswap. All of these get substantial usage.
bitreality 7y ago
Would you say the same thing about cash? Because Dai is the closest thing out there to true digital cash.
- spurdoman77 7y ago
  Cash is great for money laundering. Much better than crypto.
derefr 7y ago
Sure, but they're not speculating on the value of crypto (which is what people are actually concerned about when they talk about speculation.) These apps are just generic infrastructure, like a stock market is generic infrastructure. And, as such, they have value as infrastructure, independent of any of the assets people might list on them; just as a stock exchange has value independent of the ridiculous penny stocks people might list on it.