TITLE:
Powered by Blockchain Technology, DeFi (Decentralized Finance) Strives to Increase Financial Inclusion of the Unbanked by Reshaping the World Financial System
AUTHORS:
Saif Ahmed Abdulhakeem, Qiuling Hu
KEYWORDS:
DeFi, Decentralized Finance, Blockchain Technology, Cryptocurrencies
JOURNAL NAME:
Modern Economy,
Vol.12 No.1,
January
15,
2021
ABSTRACT: The invention of the Internet has paved the way for
a new world of opportunities in life, including finance. Even with the presence
of this invention, the traditional financial system has failed to meet
expectations set up by other technological advancements. In today’s world,
almost everyone has access to the Internet, yet not all of them have bank
accounts. According to a recent report from the World Bank Group, approximately
1.7 billion people worldwide still do not have any access to banks whatsoever.
Although the Internet has helped transfer information from one part of the
world to another within milliseconds, time and spending are still needed when
it comes to financial assets. In the last few years, a growing trend toward
decentralization in the financial system has been stimulated by blockchain and
technological innovation. Satoshi and his unique invention, Bitcoin Blockchain,
started to call for peer-to-peer transactions without intermediaries or
centralization of any kind. Six years later, the invention of another
blockchain, Ethereum, came into existence and has become the backbone of
promising decentralized finance (DeFi). This paper provides an overview of
blockchain technology, discussing the DeFi ecosystem and its possibilities
regarding financially including the unbanked and improving the current
financial system.