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Since the creation of Bitcoin in 2009, cryptocurrencies have exploded in popularity and are today collectively worth over $1 trillion.
Critics say a lack of regulation has contributed to volatility in the nascent industry. In 2022, several cryptocurrencies and crypto firms collapsed, including industry heavyweight FTX, causing trillions of dollars in losses.
Meanwhile, many governments are seeking to capitalize on the technology that powers cryptocurrencies by investing in their own digital currencies.
Cryptocurrencies and blockchains have given rise to a new constellation of “decentralized finance” or DeFi businesses and projects. Essentially the cryptocurrency version of Wall Street, DeFi aims to offer people access to financial services—borrowing, lending, and trading—without the need for legacy institutions such as banks and brokerages, which often take large commissions and other fees. Instead, “smart contracts” automatically execute transactions when certain conditions are met. DeFi is surging in popularity, with investors pouring tens of billions of dollars into the sector.
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Analysis – “This article does a great job of giving the ‘lay of the land’ of crypto. It talks about the history, concepts, issues, and contemporary topics such as up-to-date government regulations and CBDC.” – Easton Nguyen
