Speaking in a live YouTube session, Charles Hoskinson delivered a rather grim take on the future of DeFi. The founder of Cardano said many space projects will be phased out in the next five to ten years. He pointed out in particular the low quality of their engineering which will end up boring users. He took the opportunity to present Cardano’s solution for a more secure DeFi ecosystem.
A space in danger following the proliferation of cases of piracy
To justify the low quality of DeFi’s projects, Mr. Hoskinson notably recalled the total value of hacks suffered by them in 2021. With losses estimated at nearly $ 10.5 billion, DeFi protocols have been particularly prime targets for hackers. The founder of Cardano also pointed to the weak points of Ethereum as key elements that will contribute to the downfall of DeFi.
” Unfortunately, many projects in this space will not stand the test of time. We will see a great extinction happening in the next five to ten years, the reason you are doing it right is so that you can be there for this extinction event. Many of you are tired of the incredible cost, lack of clarity, and poor production quality of applications in the DeFi space. Said Mr. Hoskinson.
Mr. Hoskinson presented the Cardano DeFi Alliance (CDA), which includes various players currently developing on the Cardano blockchain. The overall objective of the alliance is to create a robust and dynamic DeFi ecosystem that will set the standard to follow for the entire DeFi industry. He added that the need to secure the current DeFi ecosystem is a matter of survival for the fittest protocols. CDA will thus develop a system that will build on the current gaps in decentralized finance to improve its longevity and security.
Cardano founder said his blockchain DeFi platform will be based on factors such as certification standards and exploring a public-private partnership. Mr. Hoskinson also took the opportunity to address the future of Cardano with several major projects planned for 2022. He notably underlined that the network would carry out several updates and would develop methods to support microfinance transactions.
The vulnerability shown by DeFi protocols could therefore cause their loss in the short term, according to Hoskinson. Cardano having successfully launched itssmart contractsthis year, the development of a DeFi ecosystem on the blockchain was inevitable. The advent of it should comfort Cardano as Ethereum’s main competitor.
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Luc Jose Adjinacou
Far from having dampened my enthusiasm, an unsuccessful investment in 2017 in some crypto only increased my enthusiasm. I therefore resolved to study and understand blockchain and its many uses and to relay information relating to this ecosystem with my pen.