DeFi-ning DeFi: Challenges &amp; Pathway

Amler, Hendrik; Eckey, Lisa; Faust, Sebastian; Kaiser, Marcel; Sandner, Philipp; Schlosser, Benjamin

doi:10.1109/brains52497.2021.9569795

Cited by 33 publications

(20 citation statements)

References 9 publications

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“…Who governs the SushiSwap exchange is thus a subject of intrigue. This intrigue extends throughout the nascent field of Decentralised Finance (DeFi) -unlicensed, unregulated, and non-custodial financial services that exist thanks to public, distributed ledgers (Nadler and Schär, 2020;Amler et al, 2021;Katona, 2021;Zetzsche, Arner, and Buckley, 2020;Qin et al, 2021). In January 2021, Uniswap became the first non-custodial crypto-asset exchange to reach $100 billion trading volume.…”

Section: Introductionmentioning

confidence: 99%

“…This new form of governance by DAOs soon led to the emergence of DeFi projects such as Maker and Compound (Amler et al, 2021;Katona, 2021;Qin et al, 2021). In the legal par-lance, DAO-based governance is non-liable, because a DAO is not a liable, legal entity (Zetzsche, Arner, and Buckley, 2020;Katona, 2021).…”

Section: Introductionmentioning

confidence: 99%

“…In spite of regulators' and law-makers' concerns, DeFi is popular among crypto-asset investors. The year 2020 witnessed multi-billion-dollar trading volumes for a variety of DeFi services, from crypto-collateralised stablecoins to non-custodial crypto-asset exchanges, loans, derivatives, and synthetics (Chen and Bellavitis, 2020;Zetzsche, Arner, and Buckley, 2020;Aspris et al, 2021;Amler et al, 2021). The market capitalisation of DeFi's voting rights tokens (and consequently the tokens' prices) increased as well (Figure 1).…”

Section: Introductionmentioning

confidence: 99%

“…Lin et al, 2021;Gochhayat et al, 2020). It is also distinct from research dedicated to DeFi's consumers, liquidity providers, services, transaction costs, and normative goals (Schirrmacher, Jensen, and Avital, 2021;Gogel, 2021;Aspris et al, 2021;Amler et al, 2021;Babel et al, 2021). The closest precedent texts are by Aramonte, Huang, and Schrimpf (2021), Jensen, Wachter, and Ross (2021), and Nadler and Schär (2020); but these texts do not examine all nine cases from Bloomberg's Galaxy DeFi Index.…”

Section: Introductionmentioning

confidence: 99%

See 3 more Smart Citations

Decentralised Finance's Unregulated Governance: Minority Rule in the Digital Wild West

et al. 2022

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Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Decentralised Finance's Unregulated Governance: Minority Rule in the Digital Wild West

et al. 2022

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“…Bartoletti et al [6] formalized DeFi theory, which is used to systematically understand and analyze the incentives in DeFi to balance interest rates and prices. Other research proposed by Jensen et al [7] and Amler et al [8] are used to analyze the risk of assets in DeFi on Ethereum.…”

Section: Introductionmentioning

confidence: 99%

A Survey of DeFi Security: Challenges and Opportunities

Li¹,

Bu²,

Li³

et al. 2022

Preprint

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Decentralized finance (DeFi), which is a promising domain since the era of blockchain 2.0, locked $200 billion in April 2022. However, it quickly dropped to $100 billion in May 2022, which makes us realize that security issues in this area are still a challenging job. DeFi is more complex than traditional finance because it is decentralized through blockchain and without a trustworthy third-party institution to act as a guarantee. So it owns not only financial properties but also technical aspects. Existing synthesis work for DeFi tends to ignore the relevance of various layers of security for the whole system. In addition, distinct layers have different means of protection against specific vulnerabilities, which is not considered by existing analytical work. In this paper, we perform a vulnerability analysis for the entire technology layer of the DeFi application, and then we collect the most impactive attacks in recent years. Finally, we summarize the existing optimization approaches for different layers and provide some challenges and future directions.

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Handbook on Blockchain

2022

Springer Optimization and Its Applications

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DeFi-ning DeFi: Challenges & Pathway

Cited by 33 publications

References 9 publications

Decentralised Finance's Unregulated Governance: Minority Rule in the Digital Wild West

Decentralised Finance's Unregulated Governance: Minority Rule in the Digital Wild West

A Survey of DeFi Security: Challenges and Opportunities

Handbook on Blockchain

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