When you put money in your bank account, where does it go? Who uses it? When you purchase shares, where do they come from? How many market makers were involved? How much profit did they make front-running your purchase?
All these things are currently completely opaque to the average person. Decentralized Finance fixes this. Every transaction and system you interact with is completely open source, transparent, and fair for everyone involved. There are no rich and powerful people taking a cut of your money every time you use the system, as it is in traditional finance.
You can see the exact code doing what you want done, and nobody can stop it doing that, or change the rules part way through (see: the Robinhood GME saga)
Traditionally the government set the rules, but the government can be corrupted. Most people know that wall street regularly breaks the law if the profit they make will be greater than `fines they pay * risk of getting caught`. Until now there was nothing we could do about this. Code can't be corrupted in the same way.
> All these things are currently completely opaque to the average person. Decentralized Finance fixes this
Code is opaque to people as well, most SWEs struggle to understand distributed systems that are using consensus protocols much simpler than byzantine fault tolerance, or programming on environment are non-adversarial, unlike solidity. You can't just learn solidity and then trust smart contracts, it takes a lot of knowledge to avoid vulnerabilities.
> Code can't be corrupted in the same way.
If you think this, you might be in your a rude awakening. "Code" is being used in crypto-currencies for corruption all the time, and there is no inherent property of computers that protects you against malice, theft and vice.
I personally don't want to live in a world where I need to audit the code for every financial transaction I'm party to, and fortunately I live in a country with a mostly working legal system that already handles this for me.
> Code is opaque to people as well, most SWEs struggle to understand distributed systems that are using consensus protocols much simpler than byzantine fault tolerance, or programming on environment are non-adversarial, unlike solidity. You can't just learn solidity and then trust smart contracts, it takes a lot of knowledge to avoid vulnerabilities.
It's open source vs closed source arguments again. I have personally never looked at the Linux Kernel or Ubuntu source code, but I trust it more than I trust Windows because I know many thousands of people have looked at it before me and said it's secure.
> "Code" is being used in crypto-currencies for corruption all the time, and there is no inherent property of computers that protects you against malice, theft and vice.
I'm sure it is, code can also be used to create viruses and malware but that doesn't mean Linux is insecure. It's about the transparency of the code and systems you use. More transparency = more trust = better outcomes. I'd rather live in a transparent, fair world, than one where those with more power and money get to set the rules and hide the internal workings from everyone else.
All these things are currently completely opaque to the average person. Decentralized Finance fixes this. Every transaction and system you interact with is completely open source, transparent, and fair for everyone involved. There are no rich and powerful people taking a cut of your money every time you use the system, as it is in traditional finance.
You can see the exact code doing what you want done, and nobody can stop it doing that, or change the rules part way through (see: the Robinhood GME saga)
Traditionally the government set the rules, but the government can be corrupted. Most people know that wall street regularly breaks the law if the profit they make will be greater than `fines they pay * risk of getting caught`. Until now there was nothing we could do about this. Code can't be corrupted in the same way.