DAAS the key to mass adoption of decentralized finance.

in LeoFinance8 months ago (edited)

DeFi, BASS, DAAS, and EasyDefi.

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  • EasyDefi is a futuristic DAAS service provider on Hive, which I think provides investors on Hive with a glimpse into the future of decentralized finance mass adoption.
  • But in order to understand why DAAS is the future of mass adoption of decentralized finance we need to talk about the current state of DeFi mass adoption, then review BAAS and finally DAAS.
  • So welcome to a glimpse of the future.

Defi: the state of mass adoption of decentralized finance

  • We have all lived through an explosian in decentralized finance, where the amount of money invested in decentralized finance grew 1000 times from millions of dollars to billions of dollars in a year.
  • This is the fastest growth of a new financial industry in all recorded history.

  • But the number of investors in decentralized finance represent less then one percent of the earths population, and by some estimates hovers around 1/2 of 1 percent.
  • This is a very small percentage of human beings.
  • Why??? decentralized finance is complicated.
  • I know it's surprising to some of you, who are DeFi Degens but to 99% percent of the world's population decentralized finance is to complicated to invest in...
  • Thats shocking when you conside that the lowest APR you can find on decentralized finance sites is around 4% per year and because Traditional bank Savings accounts pay 0.25% per year that 4% is a 16x or 16 times greater return on investment.
  • Now consider for a moment that 4% is actually very small and that temporary APRs of 1000% are not unheard of in decentralized finance yield farms. Which is an astronomically high 19% return on investment per week. So you can potentially double your investment every 5 weeks!
  • So with returns this great, decentralized finance must be extremely complicated if only 1/2 of 1 percent of the global population is invested in it.
  • So what's the solution? DAAS or decentralized finance as a service.
  • What is DAAS? read on.

DAAS Defi As A Service and BAAS: Banking As A Service

I am going to explain the title backwards because I think you may be more familiar with BAAS then DAAS, and if I explain BAAS first, you will most likely instantly understand DAAS.

BAAS or Banking as a service.

What is a bank?
A bank is a very complicated and heavily regulated entity. But many commercial busineses on the internet find it that they can sell more products and services, if they are partnered with a bank, so they can allow their customers to use credit cards and sometimes pay directly from their checking or savings accounts for goods and serviceas.

But Banks are expensive to run and banking partnerships cost a business 10-15 percent of their revenues.
If you are a large retailer like Walmart, doing 100 million dollars worth of business in a month, that's 10-15 million dollars your paying to banks every month.

So what do you do? Build your own bank!
So the retailers tried to create their own banks. But they tried and failed. Even very large retailers like Walmart, the largest retailer in the world tried to create their own banks. But they failed.

Why? Banks get to decide who gets to become a bank and they simply said no.
It seems banking is heavily regulated and controlled by the government. And a committee made up of people from all the banks in a state or province get to decide if a new bank can be allowed to operate. So in the name of consumer safety, not to stifle competition, they didn't allow any retailer to build their own banks. Ha Ha Ha :)

But then something revolutionary happened!
A large bank decided that it coud make money by providing banking services in single or multiple specific banking service packages to retailers. So in the name of making money the monopoly that banks held on banking services was broken. Now retailers could buy the banking service, deploy it in their stores and then keep the 10-15 % fees that they previously paid to banks. In return they pay much smaller fees, which amount to 1-3% of their revenues. This became known as Banking As A Service or BAAS.

BAAS or banking As A Service has become so common place that you don't even recognize it anymore. But technically when you create an account on a cryptocurrency exchange, and connect your banking account to transfer money from your banking account to your cryptocurrency account, the cryptocurrency exchange is engaging in banking services.

So ... lets move on to DAAS or decentralized-finance As A Service.

As I mentioned above banking is very complicated, and while a lot of retailers and exchanges would like to do it, it's simpler to hire a bank to provide banking as a service or BAAS.

So by now I think you see the parallel. DeFi is complicated, and although lots of people would like to invest in defi, they can't due to the complexity.

So I provide decentralized finance as a service or DAAS. And I think that DAAS is the future of mass adoption of decentralized finance, because defi is complicated, and DAAS makes it simple. My business on Hive is called EasyDefi and it's motto is defi made simple.

What do you think?

  • In your personal experience is defi complicated?
  • Do you think you would pay someone to do it for you?
  • Do you agree that defi as a service is one pathway to mass adoption of decentralized finance?
  • Have you ever heard of EasyDefi before now?
penned by my hand @shortsegments.

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@shortsegments has been writing about cryptocurrency, blockchain, Bitcoin, and decentralized finance for four years on Hive. He runs two businesses on Hive: the No Loss Lottery and Easy Defi. Both businesses provide investment services to over 100 individual investors here on Hive.
For further information about these businesses read the following articles by clicking on the title your interested in reading:

(1) The No Loss Lottery

(2) DeFi made easy; EasyDeFi, the 2 step DeFi investment strategy

(3) EasyDeFi report to investors : #56 on June 19th, 2022..

(4) No Loss Lottery Winners on June 19th, 2022!

.
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I remember briefly DASH was talking about MaaS, Money as a service and how different types of "Money" might be better for different types of transactions. For instance, bitcoin for large international transactions and something lite for the always talked about "coffee" transaction.

I see defi the same way, but also.. If someone is paying you interest on something in exchange for liquidity if there is no real reason for the transaction it will eventually lose value and fail. If I am opening an exchange and I need investment that would be a good time to pay for liquidity.

Just to put money in pools for no reason is pointless and valueless and over time that will show up in the price.

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I see your point. Uniswap trading pairs serve a need, so they continue to generate income for a long time, but many yield farms generate trading pairs just for the incentives, there is no utility in the tokens at all.

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For instance, we really do need deeper liquidity in Hive and HBD if we want large investors to stake.

Vs. the obvious "no point" Farm of CakePop. No one needs a cakepop.

I could go on here, but I'll leave it to the reader to assess, "how real is your pool".

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I love the phrase: How Real is your pool.
I hope my BUSD is safe :)

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OMG! We don’t need CakePop?
It’s my best investment of 2021!
Hi Ho Hi Ho it’s our first IDO!
Ha Ha Ha
Just joking :)

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#confessions I've never bothered to sell mine either. lol.

I think this is an excellent question we need to ask. Now that the defi summer of yield farming is over. What utility do these tokens have? Why doesn't their value just go to zero?

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In some cases there is a real use case for the liquidity, in other cases it is a game of giving one token for taking steps of staking another one.

That might last a while, but if there is no point, I can't see how it ages well.

Yes indeed, we have seen repeatedly how yield farmers moving capitol from one defi staking project to another drive up project tokens getting into the project, and drive down project token price getting out. Then when the TVL swells and the APRfalls their is enough liquidity for the yield farmers to get out with out affecting price to much, if they get out while other investors are still getting in…

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