DeFi risks and the decentralisation illusion

⚠ The summary and findings below are the editor's working notes, pending verification against the source.

BIS analysis arguing DeFi retains points of centralisation and carries familiar financial risks.

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Key findings

• DeFi exhibits a 'decentralisation illusion': governance and infrastructure remain concentrated.
• Stablecoins are a key channel linking DeFi to the traditional financial system.

Topics: DeFi & Collateral · Financial Stability & Systemic Risk

Cite this

Sirio Aramonte, Wenqian Huang, Andreas Schrimpf (2021). DeFi risks and the decentralisation illusion BIS Quarterly Review, December 2021.

@techreport{aramonte2021defidecentralisationillusion,
  title = {DeFi risks and the decentralisation illusion},
  author = {Sirio Aramonte and Wenqian Huang and Andreas Schrimpf},
  year = {2021},
  institution = {Bank for International Settlements},
  howpublished = {BIS Quarterly Review, December 2021},
  url = {https://www.bis.org/publ/qtrpdf/r_qt2112b.htm},
  note = {Indexed by Stablecoin Beat},
}

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