From DeFi To ReFi: How The Future Internet Will Upend Your Financial World

There are opportunities as well as threats: opportunities to provide better customer service, streamline internal processes, and create exciting new services that are designed for the future internet.

In financial services, particular trends to watch include DeFi, investing in digital assets, ReFi, blockchain-based lending, and blockchain-based money transfer networks.

DeFi is the term used to describe a new internet-native, crypto-based financial system that replaces traditional intermediary services with smart contracts and blockchains in a peer-to-peer system, allowing people to trade directly with each other without the help of a centralized bank.

It has the potential to strip out the inefficiencies of traditional banking, increase access to banking services, and democratize the lending process.

The DeFi movement ultimately aims to create an internet-native financial system that is built for the web3 era.

One of the major web3 aspects to impact financial services is, of course, cryptocurrency.

Crypto is a major asset class in its own right, but we also have NFTs, creating a new wave of digital assets.

Financial institutions must decide whether they want to get involved with web3 assets and include them in portfolios alongside traditional assets.

In other words, web3 could impact traditional approaches to asset management and wealth management – providing new ways to invest and grow clients’ wealth.

Traditional financial organizations often do not consider the climate impact of companies they invest in however many investors want to invest in ways that benefit the planet.

The blockchain-based money transfer network Ripple gives us a glimpse of the future of money transfer.

Ripple is a blockchain-based money transfer network that facilitates money exchanges across a variety of government-back currencies, cryptocurrencies, and assets like gold.

It serves as a trusted facilitator of transactions between two parties, similar to traditional financial services providers, but is built for the web3 era.

Another interesting effect of decentralization is the emergence of the blockchain-based network.

Helium, which describes itself as “The people’s network,” creates a fully decentralized network that users effectively build themselves.

It completely undermines the traditional business models of telecom companies and internet service providers, with over half a million global hotspots as of early 2022.

Other Businesses Really, any service-based business can expect to be impacted by web3 and the metaverse.

I believe every service-based business – indeed, every profession – will be impacted by web3 and the metaverse to some extent or another.

Real estate agents could create immersive property tours in the metaverse to market their real-world properties, use AR to “Dress” empty properties for viewings, or even pivot to marketing virtual real estate in the metaverse.

There are also exciting opportunities to adopt new technologies, streamline services, or provide immersive new service offerings.

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