DeFi : Why Bitcoin’s Decentralized Financial System is Important for Human Rights?
Since the inception of Blockchain, Bitcoin, and related technological architectures, the focal area mostly has been around financial services, medical and healthcare industry, logistics, and transportation industry. But one may see it as focusing just on the short-term and neglecting the long-term alterations which may pop-up on the ground. Such technologies will surely aid numerous industries, but in the long-term, people across the world are the ones who would be employing them. So, in a crux, human beings would benefit if they tried and scrutinize from a macro-level perspective. Make no mistake, the aid to humans would be observable only if the algorithms would be written in a specific manner, and humans would use it thinking it to be of some assistance.
The global hub for Bitcoin – USA or Europe?
Since the industrial revolution, there has been a close competition between the United States of America and Europe. Starting with automobile innovation and military power among others, and then coming to technological innovations. Both the nations have been seen as the 1st and 2nd top students in a class (metaphorically speaking). Similarly, there has been a cut-throat competition with regards to developing Blockchain and Bitcoin tools and frameworks. Just like the Silicon Valley of the USA, Malta, located in Southern Eastern Europe is said to be among the few Bitcoin hubs in Europe. With GDPR being deployed on the ground a few years ago, some may perceive Europe to be one step ahead of the USA at the moment. But one never knows what may happen tomorrow. The best thing to do is to keep one’s fingers crossed and hope for the best.
Regulatory patterns with DeFi being kept in the background.
Pattern finding and recognition have become somewhat a necessity to examine and forecast forthcoming potential scenarios. Medical, logistics, and financial services industries have experienced a small fraction of the technology in the past few years. But as the architecture is new, regular input is crucial for machine learning, neural networking and similar technologies to showcase maximum yield at the end of the day. Considering policy making and regulating, and legal structure as a whole, the alterations w.r.t DeFi should be altered immediately. As transactions could be done anywhere across the world, and higher usage is being observed because of an increase in trust factor (among others), policymakers and DeFi developers should together design, build, and implement laws according to every nation. To overcome the illicit dealings happening across online channels (also sometimes referred to as the dark web), the focal point must be pattern finding, recognition, and modifying according to a scenario and nation as well.
Increase in Robustness of Decentralized Frameworks in ambiguous scenarios.
With more developers and users entering the decentralized frameworks, interoperability and adaptability while keeping the data/money secure be of utmost necessity. Such a feast may take a few experiments before experiencing the desired output. Due to cost-effectiveness and more technical experts in the market today, a higher number of potential prototypes are being developed in short intervals. For robustness to get heightened in DeFi’s Architecture, one will need to first understand thoroughly its building blocks. Just like the internet protocol suite, DeFi also uses a multi-layered framework, which encompasses:
- The Settlement Layer
- The Asset Layer
- The Protocol Layer
- The Application Layer
- The Aggregation Layer
It might seem obvious that each layer is interconnected for completing a specific task. In this piece of research, a macrolevel description is shown through a diagram about the interrelation between developers, merchants, bitcoin grid, exchange platforms, and the rest of the variables that help the decentralized framework operate swiftly and with utmost precision.
Digital Asset Market.
A digital asset consists of a lot of variables like:
The market for digital assets came into notice after social media platforms (mostly which are used across the world), i.e. around 2009.
But when it comes down to evaluation from a venture capitalist’s perspective, there’s a lot of uncertainty among those building it, offering it, and using it as well. The principal value of an asset is the current value of payoffs including the complete available appropriate information. As DeFi is decentralized, and not managed by an authority, its value changes with time. That is one factor of uncertainty among people in the DeFi ecosystem. Cybersecurity and crypto-economics and relatable variables are gradually picking up the pace in narrowing down the fear of uncertainty.
Can Social Bitcoin sustain a Democratic Digital World?
Intermixing Bitcoin, Sociology could seem to be a fascinating idea at the face value, but until it’s not implemented and experimented with in small clusters, it is too soon to tell whether a social Bitcoin could sustain a Democratic digital world. If one delves into and examines the sociological patterns financially in different centuries, there’s a narrow hope. But if similar concepts are applied with an appropriate mindset from people building and those using it, then there might be a lot of hope in the coming times.
One big benefit of using Bitcoin with sociology kept in mind at the back is that the whole ecosystem works including micromanagement and micromanagement as well. Unlike a centralized environment, a decentralized ecosystem modifies when required. It doesn’t wait until everything is at the tip of a breakdown. Besides that, developers and venture capitalists operate simultaneously, meaning, if a cluster of developers built an application that surpasses others, the developers receive some form of incentive/bonus which helps in building more productive tools in the future. Such a scenario might not be visible with clarity because of complications in the regulations, policies, and the overall functioning of a centralized framework. A multi-dimensional financial system is one potential approach to resolving the financial mess many nations are experiencing (according to this piece of research). Some portion of the worldwide population are preferring to use digital currencies over currencies in physical form.
After going through the current scenario in nations where a major focus is given on R&D, scrutinizing from the market’s point-of-view, seeing how to intensify the robustness, and finally examining if a social Bitcoin could sustain the digital world, it might be appropriate to say a lot of trial-and-error’s need to happen before finalizing it. Even after finalizing it, one shouldn’t be hesitant to build a fresh architecture from scratch.
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