00000nam 2200000zi 4500 9.916421 CaOODSP 20221107183433 m o d f cr |n||||||||| 221020t20222022oncd ob f|0| 0 eng d CaOODSP eng rda CaOODSP n-cn--- FB3-5/2022-43E-PDF Chiu, Jonathan, author. Grasping de(centralized) fi(nance) through the lens of economic theory / by Jonathan Chiu, Charles M. Kahn and Thorsten V. Koeppl. [Ottawa] : Bank of Canada = Banque du Canada, 2022. ©2022 1 online resource (ii, 32 pages) : charts. text txt rdacontent computer c rdamedia online resource cr rdacarrier Staff working paper = Document de travail du personnel, 1701-9397 ; 2022-43 "Last updated: October 11, 2022." Includes bibliographical references (pages 27-29). "In this article, we use a simple stylized model of collateralized lending to analyze the value proposition and limitations of decentralized finance (DeFi). DeFi uses a decentralized ledger to run smart contracts that automatically enforce the terms of a lending contract and safeguard the collateral. DeFi can lower the costs associated with intermediated lending and improve financial inclusion. Limitations are the volatility of the crypto collateral and stablecoins used for settlement, the possible incompleteness of smart contracts and the lack of a reliable oracle. A proper infrastructure reducing such limitations could improve the value of DeFi"--Abstract. Cryptocurrencies. Loans. Cryptomonnaie. Prêts. Bank of Canada, issuing body. Staff working paper (Bank of Canada) 2022-43. (CaOODSP)9.806221 PDF 732 KB https://publications.gc.ca/collections/collection_2022/banque-bank-canada/FB3-5-2022-43-eng.pdf