Nithin starts the video with a question: if the rule of the land was that you could only sell your house through an agent and had to pay the agent 90% of your profits, would you do it? He then compares this situation to how banks work. Banks charge interest on loans and pay depositors a small fraction of that interest. He argues that this is unfair because people do not have a choice in banking when collecting deposits and should have more control over their money.
DeFi is a new way of doing financial services on public blockchains. Blockchains are ledgers that are secure and transparent. Defi allows people to borrow, lend, and trade without going through an intermediary like a bank. Borrowing and lending the DeFi way can save people money and give them more control over their finances.
The speaker then discusses three reasons why DeFi is not the ubiquitous way of doing financial services.
It is a new technology, and people resist change.
There is much fear-mongering from incumbents in the financial industry.
The price of Bitcoin, the flagship cryptocurrency, has decreased in recent years compared to two years ago.
Nithin concludes the video by saying that Defi is a brilliant technology that has the potential to revolutionize the financial industry. He encourages people to learn more about DeFi and see how they can participate in this revolution.
Ntihin argues that the current financial system is unfair and rigged against ordinary people. DeFi (decentralized finance) is a probable solution, as it is a more transparent, efficient, and democratic way to manage your finances.
Here are some key points from the video:
The current financial system is unfair: Eapen points out that banks and other financial institutions charge high fees and take advantage of customers. For example, he mentions that banks charge an average of 6% commission on home sales, even if the seller makes a loss. He also criticizes that banks pay depositors very little interest on their savings while charging borrowers much higher rates. Defi is a new way of doing financial services built on blockchains. Defi is a brilliant technology that has the potential to revolutionize the financial industry
DeFi is a more transparent and efficient alternative: Eapen argues that DeFi eliminates the need for intermediaries like banks and financial institutions. Instead, DeFi uses smart contracts, self-executing contracts running on a blockchain, which means that transactions are transparent and secure, with a lesser risk of fraud or manipulation. Defi allows people to borrow, lend, and trade without going through an intermediary like a bank.
DeFi gives you more control over your money: With DeFi, you have custody of your assets, which means that you can decide how your money is used, and you are not at the mercy of banks or other financial institutions. Defi can save people money and give them more control over their finances.
DeFi is still in its early stages, but it can potentially revolutionize the financial system. Eapen acknowledges that DeFi is still a new technology. Still, he believes it has the potential to change the way we manage our finances. He points out that the total value locked in DeFi protocols has grown from a few million dollars in 2019 to almost $200 billion in 2021.