SUNDAY THOUGHTS - What's the goal of Decentralized Finance?

Airdrops and food tokens have made many many millionaires during the last couple of weeks. This was all due to the first "DeFi bubble", which popped by now. But is this the end of Decentralized Finance?

First of all, it should be clear to everyone reading this that these food tokens, airdrops, and Ponzi schemes had nothing to do with the original idea of Decentralized Finance. DeFi is about much more than just getting rich with unaudited lines of code. DeFi is the separation of financial services and state just as Bitcoin is about separating money and state. 

Over the last few weeks, we shifted away from this idea and went full degen mode. We put massive amounts of money into Ponzi schemes and thought everything was fine. But this had to stop. And this is a good thing.

Now we can focus on building again. It's our responsibility to bring back the original idea of DeFi into the discussion. But how will our world look like when DeFi has gone mainstream? One thing is for sure: It will be all about financial inclusion, fairness, freedom, and equality. Let's dig a little deeper!

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Our current financial system is flawed. Money, as we know it today, is nothing more than credit. Behind every dollar, there is an equivalent amount of debt. When money is created, it is given to banks, states, or companies in the form of liability. 

The process of money printing is damaging to most people out there. Only a few people can profit from it. To understand why you need to understand the Cantillon effect.

Cantillon Effect

In theory, money should be scarce because it obeys the laws of supply and demand. As the supply of an asset goes up, its price declines. 

As the currency is printed, its supply goes up, which dilutes the whole currency's value. This is just fine, as long as everyone receives the same amount of cash. But most of the time, this is not the case.

Only a small number of companies/institutions are privileged enough to be bailed out by the banks and can get their hands first on the newly printed money.

While these companies are getting richer, the money on your bank account is losing its value. The Cantillon effect is one of the biggest reasons why the gap between the rich and the poor is getting bigger every year.

The sad thing is that people now realize what's happening. They blame it on capitalism, presidents, and society but cannot understand the actual reason behind the noise. 

This is the reason why DeFi is so extremely important. We need to change our current financial system. Who else is going to do it?

The World of Tomorrow

DeFi is going to shape our world in a much fairer way than most people can imagine. DeFi is not about food tokens, airdrops, and getting rich quick. It's about giving people back control over their finances. 

Each dollar that is saved on your bank account today is worthless tomorrow. Each ETH that you hold today on Aave is worth more as time goes by. 

In DeFi, nobody has the chance to dilute your savings. This is the beauty of this new technology. Everyone is equal.

Ethereum has a fixed inflation rate, which means that no single authority can change that! Anyone can verify every emitted Ether, and as long as you trust in math, you can believe in DeFi.

This is the mission we are on right now! We need to change the corrupt and unfair financial system of our time. DeFi is much more than just airdrops and Ponzi games; it's about making finance fair again. It's about creating a fundamentally fair environment for companies to thrive. 

Today we are far away from this kind of mass adoption. Currently, our networks are too slow, too expensive, and too small. We need to solve many problems along the way, and it might take another 10-20 years for us to achieve this utopia. But we are well on track to make the world a better place.


Now is the time to focus on fundamentals. Ignore the noise, build stuff, and think long term. We are far away from mass adoption, and there lies the opportunity to act. Don't get distracted by short term hypes and get rich quick schemes. We are on a mission that is too big to fail. 

I want to make one thing clear: If you are reading this now, you are one of the lucky ones. You are one of the first people to hear about Decentralized Finance, the technology that will shape this decade. Don't waste this opportunity. Focus on building the future.

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All information presented above is for educational purposes only and should not be taken as investment advice.