Decentralized Finance (DeFi): An Emergent Alternative Financial Architecture

Critical Blockchain Research Initiative (CBRI) Working Papers

12 Pages Posted: 2 Apr 2021

See all articles by Usman W. Chohan

Usman W. Chohan

UNSW Business School; Critical Blockchain Research Initiative (CBRI); International Association of Hyperpolyglots (HYPIA); Centre for Aerospace & Security Studies (CASS)

Date Written: January 26, 2021

Abstract

Decentralized Finance (DeFi) offers the promise of an emergent alternative financial architecture that prioritizes disintermediation and decentralization to empower individuals along cryptoanarchist principles. Yet it is mired in considerable difficulties including market manipulation, distortionary incentives, excess short-termism, Ponzi-schemes, and money-laundering challenges that also foment a considerable level of dissuasion against DeFi’s wider adoption. This paper critically evaluates many of these important facets at a time when DeFi is emerging as a disintermediated and experimental financial praxis.

Keywords: blockchain, cryptocurrency, DeFi, decentralized finance, networks

Suggested Citation

Chohan, Usman W., Decentralized Finance (DeFi): An Emergent Alternative Financial Architecture (January 26, 2021). Critical Blockchain Research Initiative (CBRI) Working Papers, Available at SSRN: https://ssrn.com/abstract=3791921 or http://dx.doi.org/10.2139/ssrn.3791921

Usman W. Chohan (Contact Author)

UNSW Business School ( email )

UNSW Business School
High St
Sydney, NSW 2052
Australia

Critical Blockchain Research Initiative (CBRI) ( email )

International Association of Hyperpolyglots (HYPIA) ( email )

HYPIA
www.polyglotassociation.org
Montreal, Quebec
Canada

Centre for Aerospace & Security Studies (CASS) ( email )

Islamabad
Pakistan

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