This article talks about Crypto, Decentralized Finance, Liquidus and Complexity surrounding them
On October 31st, 2008 the first Whitepaper for Bitcoin was released by an anonymous person called Satoshi Nakamoto. If you look back in time, it’s barely 13 years ago. People were barely transitioning from Web 1.0 to more interactive Web 2.0. Machine learning and Deep learning had not bloomed. Social medias like Facebook, Instagram, Youtube and Twitter were barely toddlers.
Amidst that social transformation, came this 9 page whitepaper which helped devise the first blockchain databases. But to many people, till this day, it’s been a problem understanding what blockchain is let alone understand what the cryptocurrencies are, or even the utilities some of these tokens provide. The world of crypto is complex. It’s more than just going to a bank and depositing and withdrawing money. Investing in it is complex. You have to be technical at some level to be able to understand how to own your money, how to utilize your money, how to transfer money. At the same time, you need to be willing to learn, be patient and adapt to new changes all the time.
There have been a bloom of a lot of tools lately, to help simplify the process of adopting and understanding the world of cryptos. But the process is still far too complex. Think about teaching a person, who never knows what a cryptocurrency is, all the details about the blockchain and crypto to make him and investor. It’s a mountain to climb even for the tech savvy people.
Personal Experience Trying to Onboard Few Friends To Crypto:
I recently had to teach a few friends of mine, who never had been to crypto to buy a few tokens on Binance Smart Chain. Here is what I had to do to be able to help them buy one of the cryptos.
- I had to start with teaching him the the basics of what cryptocurrency is, what blockchain is what the explorers are.
- Then came the step of helping them to buy some cryptos. Most of the banks would not let them buy any cryptos directly citing investment risk.
- So we had to create them a Binance account. Many of my friends who are not in crypto space, but are still tech savvy, have never heard of Binance or Kukoin or even Crypto.com or any Crypto Exchanges. So the challenge is to make them understand that these businesses are legit. It takes them some gut to create account in these Centralized Exchanges that they have never heard of but suddenly seem very popular (and normal) among the crypto enthusiasts. It was way different experience to convince them than to ask them to open a U.S Bank or Wells Fargo bank or any other large corporate banks (Which would pretend to hold your money but would not even let you buy the crypto directly)
- Once the Binance account is created, now they had to link their bank accounts with hesitancy. Because of all the negative FUD (Fear, Uncertainty and Doubt) that either the main stream medias or banks portray in the news feed, the hesitancy is normal. Also, volatility in crypto is very high, hence the risk and the reward. But that volatility also drives away most investors fearing they could lose all the money (and which they can).
- Next step was to fund their account. Luckily services like PLAID in US which link your bank accounts to other financial institutions were not new to them. So they could at least get some sigh of relief. And the good part using those services are they are relatively fast. You can fund your account within minutes versus waiting for a traditional ACH clearance which takes upwards of three business days. If you transferred it on Friday, it would even mean you have to wait five days.
- Once the Binance account was funded, came the part of buying Binance coin. What’s BNB? Is is trust worthy? Why is it fluctuating in it’s price so much in just few days. All good questions, and that needed a lot of explaining. I bring that up because a lot of education is needed in the sector of crypto. A lot of teaching, a lot of mentoring can help people be comfortable and adopt crypto. Then finally got them some BNB. Suddenly exchanges like Binance or Uphold hold your money for a large number of days before you could even transfer out. Binance in US holds the money for 10 days, Uphold holds for 65 days. Then what good was it to fund the account using PLAID in real time?
- After 10 days were over, had to teach the friend what wallets are, what seed phrase is, what Binance Smart Chain network is, what Dapp Browsers are. A lot of learning. You’re lucky if someone is still following you !!
- Now can I buy a token already? How do I buy a token? Why wasn’t I able to buy the token in Bianance itself? Why there is no buy button on the wallet with most tokens? What is there no certain token for sale? A lot of good questions. A lot of reflections on complexity.
- Then I told them you need to use Pancakeswap for many token purchases that are not listed on Centralized Exchanges. Pancake What? What’s even a pancake swap? Then you end up teaching them what swaps are what Decentralized Exchanges are. What slippage is. What Automated Market Makers are. What liquidity pool is. Won’t blame if your friends have already lost 90% interest.
- Then finally we were able to buy him some tokens. And had to do some explaining on the gas fee.
- Question follows, do I get interest for holding the tokens? Just like bank? Can I send the money to a friend? How do I get my money back into the bank. How do I even sell this token?
You just can imagine what a toll an average Joe might need to go through to buy his first cryptocurrency. Luckily for some of the mainstream tokens and for popular tokens, Centralized Exchanges have created some abstractions that the user don’t have to go through all these hoops to buy their first token. But not every token is in the exchange. Definitely not the new ones.
So the widely accepted notion in the mass, as well as a good portion of reality here is that Crypto owning process is tedious, prone to errors, and definitely not user friendly for the newbies, young adults, not tech savvy people and the seniors. This is the reason, why the adoption of the crypto has been slow. In my opinion the complexity is one of the factors what is alienating new users to this world. If you have been to crypto, it feels like a totally different parallel world with so many beautiful developments that the mainstream is unaware of. People will be amazed if you tell them that Yield Farming and Staking pay you way more APY than you bank.
So what can be done to resolve this complexity?
One answer is to come up with a product and process that is focused with Average people in mind as their users, not the tech savvy professionals.
Luckily there is a team that has thought through this complexity, and working hard to make the crypto buying and farming an easy experience for the general public. This company is called Liquidus. But that’s just one of the company that is working towards solving the problem of this complexity in the Decentralized Finance world. That have many others who have realized this complexity and trying to find some kind of solutions to it. It’s a fast growing area.
I am an early public investor in the Liquidus project, so I am highly passionate about it. However, I am writing this article in a non-biased way and to truly highlight what the team is doing to remove this complexity of DeFi world and to help people generate income that are unthought at the traditional banks.
User Experience is at the core of their heart at Liquidus. Simplifying the process for an user to interact with Crypto is the essence of mass adoption. Let’s put it this way, if an app or a product is simple enough to understand and use, many people will have ease using it and will like it, and adopt it and in turn get the benefits that the most cryptos tend to provide over the course of time – the opportunity to grow money, the ease of money transfer, the avoidance of middlemen and thus reduced fees on transactions.
Liquidus is doing exactly same. The team believes in the quality of the product than the quantity of the early adopters. That is primarily because a good product brings the new users by it’s own popularity. Do you think Facebook and Gmail need to do advertising to bring in new people? Definitely not. Because they are household names. So Liquidus is working on building a simplified, minimalistic product that aims to attract a large user base many of which are going to be first time users.
A good product comes with security, assurances, and benefits. Liquidus is an amalgamation of them all. They will have insurances for transactions, so if you lose you fund, your insurance covers you for your transaction. They are building high yield farms. Depending on the needs, people can stake in short term or long term farms. They are even allowing people to contribute to the liquidity by providing the Liquidity pairs.
Hopefully more products in the market put user experience at the core of their heart. And more importantly provide the education that the first time users or even the experienced users need. So between a user friendly application and and intuitive education and awareness, I am sure a lot of people can be guided to the beautiful world of crypto. Overall, Decentralized Finance is money by the people for the people so everyone’s inclusion is necessary to meet the objective of DeFi.
The world of Decentralized Finance is complex at it’s core. But thanks to the initiatives of products such as Liquidus and a few others and hopefully quite a lot more in the future, a mass adoption of the DeFi seems possible. And I am very excited about it. !! I am looking for ease of use, intuition, security, minimalism and overall user satisfaction in these products.