DeFi as a Remedy – Since its advent in 2020, the decentralized finance (DeFi) he’s come a long way. In fact, it offers a free financial ecosystem accessible to all. Now, many observers see in DeFi the possibility of solving many problems of traditional finance. This is the case with Uniswap.
the World Economic Forum takes place in Davos until 20 January. On this occasion, many players in the financial ecosystem published reports to be presented during the event.
Obviously, in the lot, we find many companies related to cryptocurrencies. Thereby, Financial internet circle And Uniswap laboratories collaborated to produce a report on foreign exchange transactions. In practice, this report focuses on the use of cryptocurrencies in this context.
Thus, the latter tried to prove use cases of cryptocurrencies. The goal is to conclude that they could improve safety and reduce operational costs.
These security gains and cost savings would be achieved particularly through the use of DeFi.
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Foreign currency transactions
First, the report highlights the advantages of cryptocurrencyif DeFi in foreign currency transactions (foreign currency (FX) transactions.).
In fact, every day over 2 trillion dollars go through foreign currency transactions. However, the latter run the risk that the part of the agreement not yet settled will not fulfill its obligations.
In this case, the transaction finality feature could help alleviate this problem through instant transactions.
Savings on cross-border transfers
Secondly, Uniswap and Circle Internet Financial studied the use of cryptocurrencies in the context of cross-border transfers.
Therefore, the researchers calculated that the use of cryptocurrencies in this context would allow for this reduce cost by 80%.
So, they felt itabout 30 billion dollars per year could be saved by relying on decentralized infrastructure rather than the current system.
However, it’s difficult measure the interval what will this relationship have. In particular with respect to the general context in which cryptocurrencies fit at the moment. Indeed, these do thesubject of great mistrust after the cryptocurrency winter and the collapse of several entities such as the Terra blockchain or the FTX failure.
However, while cryptocurrencies aren’t getting a boost from regulators, MNBCs are getting another treatment. Thereby, the creation of a digital euro issued by the ECB is becoming clearer.
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