DeFi is at war. Total value locked (TVL) is at its pre-pandemic level of $50 billion, along with the prices of bitcoin and ethereum. Rising inflation is driving the cost of money out of fintech innovation investment and raising capital is becoming more difficult. Many fintechs are facing downsizing and staff layoffs while their customers are facing rising mortgage, energy, and food costs. Regulators cannot seem to move fast enough with crypto spot market and stablecoin regulation and have resorted to the blunt tools of enforcement as a shot across the bow of the industry. OFAC and Tornado Cash, and the CFTC’s recent enforcement action against decentralized blockchain protocol bZEROx have sent a chill up the spines of decentralized finance (DeFi) network stakeholders. Regulators do not appear to have an expressed objective to regulate algorithms, but in the absence of individuals or legal entities to hold accountable, they must be seen to be taking action against hackers, cyber-syndicates and state-sponsored cyber-attacks.
Read more : DeFi Is At War: But Not With Who You Think.