Robert Leshner, the founder of Compound Finance, said that CeFi will embrace DeFi and there are signs it is already occurring.
It has been reported that Leshner aired his views on CeFi/DeFi integration in Global DeFi and Blockchain Virtual Summit in Bangkok, Thailand, the issues with Ethereum, and the advantages of decentralized governance.
However, host Mukaya Panich, the chief venture and investment officer of event sponsors SCB 10X (linked to Siam Commercial Bank), asked Leshner about DeFi’s integration with traditional and centralized finance.
He commented that lines will blur and centralized finance and businesses will start to use DeFi to power the back end in order to improve user experiences.
“I’m really excited about seeing CeFi systems embracing DeFi back end operations.”
The report said that Leshner warned Ethereum, the network upon which most DeFi projects are built, may no longer be up to the task. He also said that Ethereum had high composability but was slow and expensive to use, and reaching its limitations.
Compound Finance's founder says that he is excited to see "CeFi systems embracing DeFi back end operations.” https://t.co/DE9x9dPuT2 — Cointelegraph (@Cointelegraph) December 16, 2020
He further stated that an unfortunate consequence of this would be that it is no longer economically viable to use for smaller transactions and users.
“The more transactions, the more it will crowd out small balances.”
Likewise, he said that it meant no single entity can maliciously ruin the protocol and anybody can contribute to the collective upgrading of a protocol.
On the downside, he said this leads to slower governance decisions and modifications and the protocol may only slowly evolve over time. Comparing it to Bitcoin, which he said was predictable and slow to evolve.
“Bitcoin is so successful because it doesn’t change much — everyone knows what to expect from it.”
Moreover, Leshner revealed plans to add more “real world” tokens to the Compound platform. The current criteria for inclusion are that the asset needs to be an Ethereum-based fungible asset with a certain amount of liquidity.
Thus, he stated that more will be added as they become tokenized:
“Over time more real world assets [will be added] as they become mainstream on the Ethereum blockchain.”