Welcome to New Adventures in DeFi. This page is one of many devoted to decentralized finance and crypto, and it’s reasonable to ask if the world really needs another one. As you’ll have deduced I think it does, and here’s why.
Commentary on this topic is partisan. There are exceptions, of course, but a great deal of the commentary on crypto and DeFi will present it as either the wonderful future of finance or a massive scam led by charlatans.
The ramifications of mass crypto adoption are rarely discussed and they need to be explored. As such, the posts here will look at how decentralized finance can materially change our financial lives.
Much of the discussion around DeFi focuses on people making huge sums of money or getting caught up in scandalous frauds. That’s interesting, for sure, but there are bigger narratives unfolding.
And what are these narratives?
a) Money can now be programmed to do things. This is a digital upgrade to money itself and it could change finance forever.
b) Central banks will now want to keep a watchful eye on the success of private digital currencies. To take a long-term view, the popularity of crypto and DeFi protocols presents questions about economic sovereignty and government policies. There is also a monumental issue, which regulation isn’t currently capable of handling, created by the existence of currencies that operate outside of the law.
c) We are entering a future with an increasingly diverse money mix. Cash and digital money (as in the digital money you see in your bank account) can now co-exist with any number of cryptoassets and Central Bank Digital Currencies (CBDCs), all with different features.
d) Aside from all of this seriousness there have been breathtaking creative use cases for DeFi; some of them brilliant, some whimsical, and some both. People have used DeFi as a launchpad for trying to buy NBA basketball franchises and the US Constitution, and memecoins have attracted worldwide attention. I want to explore what these developments really mean and dive into the eccentricities too.
These are rich topics to explore but who am I and why do I care? To answer the first question, I’m Ian Horne, a writer and content creator based in London, and this substack covers the core themes of my upcoming book, Why DeFi Matters, due for release in October 2023.
Why do I care? Well, I was working as a relationship manager for UK financial advisers and wealth managers when crypto first garnered mainstream attention, and there was something about the response to it - a curious blend of excitement, disgust, joy and loathing - that convinced me it was a topic worth exploring. I also noticed a jarring difference between the analysis found in the traditional financial press and the commentary available from the many scattered voices of DeFi across the web. You’d think that people were describing very different things, and in several respects they are. Regardless, my curiosity was piqued and as best as I can, I want to offer level-headed insight on what is truly happening.
There are also, obviously, issues that extend far beyond my curiosity and personal interests. For instance there’s a huge need for clarity on DeFi right now as high profile legal and regulatory decisions approach, and as politicians start to take stances on the future of digital currencies, especially in the United States. There is also a persisting public interest in crypto investing, as people seek alternative ways to boost their finances or even to simply get by. There are thousands of angles to approach DeFi and crypto from, and for my part I’ve sought to demystify it all and help people towards a real understanding of what is actually happening.
For full disclosure I’m positive on what crypto and DeFi can be, and I see serious need for reform in traditional finance, but I don’t have a vested interest in this. Crypto could ‘go to zero’ today and the impact on my finances, (save for the repercussions of any resulting economic contagion) currently, would not be significant. I do hold a relatively small amount of Ether, however, as well as an utterly useless NFT of a cartoon dog wearing a hat. If someone wants to buy this from me for an exorbitant sum, you know where to find me.
Jokes aside, what I really care about is what this new technology does to finance and whether or not this is a good thing. My hope is that it can be, but people will decide that rather than the technology itself.
So that’s New Adventures in DeFi. Click the link below for regular updates.