Managing Risk in DeFi

J. R. Jensen and O. Ross, “Managing Risk in DeFi” in CEUR Workshop Proceedings, Aachen 2020

6 Pages Posted: 18 Feb 2021 Last revised: 10 Mar 2021

See all articles by Johannes Rude Jensen

Johannes Rude Jensen

University of Copenhagen

Omri Ross

University of Copenhagen

Date Written: 2020

Abstract

Decentralized financial application (DeFi) are a new type of consumer-facing financial application composed of as ‘smart contracts’ deployed on a permis- sionless blockchain. We situate the DeFi concept in the theoretical context of permissionless blockchain and provide a taxonomical overview of agents, in- centives and risks in DeFi applications. We identify four key risks with rele- vance for managers, practitioners and scholars contemplating a proactive en- gagement with decentralized financial applications. We contribute new founda- tional insights into a rapidly emerging field with far-reaching implications for consumer finance.

Keywords: DeFi, Blockchain Smart Contracts, Decentralized Finance

Suggested Citation

Jensen, Johannes Rude and Ross, Omri, Managing Risk in DeFi (2020). J. R. Jensen and O. Ross, “Managing Risk in DeFi” in CEUR Workshop Proceedings, Aachen 2020, Available at SSRN: https://ssrn.com/abstract=3745568 or http://dx.doi.org/10.2139/ssrn.3745568

Johannes Rude Jensen (Contact Author)

University of Copenhagen ( email )

Nørregade 10
Copenhagen, København DK-1165
Denmark

Omri Ross

University of Copenhagen ( email )

Nørregade 10
Copenhagen, København DK-1165
Denmark

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
123
Abstract Views
371
rank
270,824
PlumX Metrics