Binance, CEO CZ, thinks that in the next bull market, DeFi will outperform CeFi

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Binance, CEO CZ, thinks that in the next bull market, DeFi will outperform CeFi

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We cannot think of crypto without considering Cefi and DeFi. Earlier CeFi got much attention because of its easy accessibility. But DeFi is currently outperforming CeFi. These are not my words. CEO of Binance CZ said so.

What is DeFi?

DeFi is known as decentralized finance. It is an approach by which finance-related services are performed in a decentralized way in the crypto market.

What is CeFi?

CeFi is known as centralized finance. In this kind of approach, services are performed in a centralized way. Here all decisions and actions are directly controlled by a single institution. Binance is a centralized finance medium in particular.

What are the differences?

As said at the beginning of my post basic difference lies in the mode of operations whether services are performed centrally or De-centrally. Nevertheless, DeFi comes with a series of new applications and use cases. Here services are conducted through smart contracts which provide use cases like trading, lending, borrowing, and many more using blockchain tech. source

Why does CZ believe DeFi has much potential?

Now, coming to the main point of my discussion why CZ thinks in that way? Many factors lead us to CZ’s conclusion. source

The factors are:

1. Decentralization and Control: The DeFi system provides users with better and safer access to funds. Whereas in CeFi users have to solely rely on the trusted or their chosen exchanges. So if something bad happens to the exchange users can be affected.

2. Accessibility: Users can access DeFi with only an internet connection. So, it is very easy to join and use the features there. In the case of CeFi users have to follow strict rules and regulations set by the exchanges or institutions.

3. Innovation: The DeFi system comes with modern tech as a result it is growing rapidly. Many new features are being brought regularly offering solutions to overcome financial problems. In CeFi we hardly see this.

4. Transparency: DeFi transactions are performed in the blockchains so user can monitor what is happening and how their funds are getting used. They can also verify each transaction and take action for the sake of the safety of their funds.

5. Global Reach: The DeFi system only requires an internet connection. This unique feature makes it more demanding in the space right now. There are no restrictions. People from anywhere in the world can get into DeFi. In CeFi users have many restrictions.

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Deduction:

CZ is a successful financial advisor and an entrepreneur. His forecast shows strong evidence that DeFi is going to rule crypto in the future days. But to see which side wins the race in the next bull run, we must patiently wait.

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@toufiq777