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zeroclip | 3 years ago

They are widely used and process billions per day.[1]

There are other problems with DeFi: protocol risk, transaction fees, speed, UX. They are newer and less known than CEXes and most users who buy and hold crypto on FTX or BlockFi do not know how to use the blockchain. Most of these problems can be overcome, like see L2 development, but it will take some time.

[1] https://defillama.com/chain/Ethereum

discuss

bogomipz|3 years ago

Could you elaborate on what exactly is the "protocol risk" in DEX?

zeroclip|3 years ago

A protocol is just code, code can have bugs. Another risk is around governance. Some protocols use proxy contracts, so a single developer or team can upgrade them. But they can accidentally push out a bug in a new version. Other protocols like Uniswap opt for non-upgradeable contracts, users have to opt-in to the new version.