Robert Lensher, the founder of Compound, believes that DeFi should be the foundation of every market and financial product in the future.
At Chainlink SmartCon in New York, Leshner told Decrypt that he thinks the last couple of months have shown, without a doubt, the advantages that DeFi creates. Moreover, he said that DeFi should be the foundation for every type of market and financial product in the future.
As Bitcoin plummeted, then centralized firms like Celcius, which is now bankrupt, scrambled to keep their firms afloat, and the first debt they started paying off was made in DeFi. While several creditors continued to wait to see their funds. However, in July, Celcius, the lending firm, paid off the last of its decentralized loans to MakerDAO. Previously, Celsius, Maker, Aave, and also Leshner’s Compound protocol had gone down.
Under this chaos, none of these platforms suffered a single hiccup because of smart contracts’ unstoppable visibility and code. About this Lensher said that every single DeFi protocol, Compound included, basically went through unbelievably turbulent times without a hiccup.
Lensher said that those DeFi protocols in Compound were designed for radical transparency, so everybody knew exactly what assets were in Compound. Moreover, he said the Compound held all the information about what the borrowers looked like, how healthy they were, and all of the collateral that was necessary to support those borrowing.
About Celsius and Voyager, Lensher said that nobody knew what they were doing, unlike a DeFi protocol, and they got to manage their business however they saw fit. He said that they were aggressively lending, uncollateralized, to Three Arrows Capital, and no one thought their business model was.
Moreover, he said that these are the problems with CeFi he thinks regulators should look at and say Wow if they were DeFi, none of this would have happened.
