DefiTalk - Harvey Campbell: On financial efficiency

In the podcast, Professor Campbell talked about DeFi as a means of efficient capital, allowing us to bypass banks which introduces additional barriers for economic initiative. I’ve been impressed with Radix on the tech side, however when thinking about products that could move DeFi into the mainstream, I couldn’t help but feel that DeFi is gradually getting integrated into the existing system. With respect to Radix, especially since it does hold the potential for the scaling, how do we build toward an improved financial system if we model a lot of DeFi products after those existing in the current financial system? Are we simply building an improved version of the beast?

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Are we simply building an improved version of the beast?

I’d say it would be a great start for Radix :slight_smile: . What kind of new features would you like to see be included in the future, to separate Radix from the current financial system?

Yea I think at this stage it’s sufficiently good enough to rebuild familiar things as we do need it for recognition and growth.

To use a very simple use case for this discussion - real life transactions for real world goods/services. Currently, the accepted rule of thumb for practical transactions is:

  1. transact in crypto + oracles or stablecoins for consistent pricing
  2. Bridging into fiat

This bridging into fiat seems to be a step backward, as we’re now back to relying on the middleman systems that DeFi intends to replace. I believe that as long as this basic transaction is still reliant on existing systems, the promise of DeFi remains quite empty. All it takes to dismantle DeFi is for regulation to require that any fiat bridging requires multi-sig from centralized banking entities, and now we’re back to square one.

I’ve wondered briefly if a decentralized approach for a collaterized stable coin is possible (to enable p2p transactions as originally intended) - but that would mean having to pool the collateral in a centralized manner, and now we’re back to forming banks. Perhaps an exchange/bank that is DAO/protocol driven? I don’t think this idea is novel, but I think the execution of decentralization in such entities have yet to be realized in DeFi and that’s why we struggle and revert back to central organizations that can be regulated away.

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