4. An Introduction to DeFi
How accessible are traditional financial markets?
Think about how many requirements and restrictions exist around taking out loans. To even get approved for one requires a bank account, good credit, tons of documentation, and can take weeks or even months. Banks then charge high interest rates on these loans, making it even harder to pay them off.
The financial system that exists today has often been criticized for its lack of fairness and its harsh practices. While developed countries have certain standards and regulations in place, developing countries often do not. Residents within these countries have little to no exposure to the banking system due to corrupt practices, high amounts of inflation, and a lack of government regulation in the banking sector.
What if there was a way to take out a loan with none of those obstacles in place?
What if you didn’t need a bank account, a high credit score, or even an ID?
What if you could take it out in a matter of minutes?
This is the true power of decentralized finance.