Balaji Srinivasan: On-chain lending rates will be determined by the market and will replace central bank services with decentralized banking

2024-12-09 17:39:24

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ChainCatcher news, Ethereum investor DCinvestor pointed out on social media that on-chain lending is the most revolutionary application of blockchain, comparable to the most important innovation in the financial sector since the establishment of the central banking system in the 17th-18th centuries. However, most people are still unaware of its significance.

Former Coinbase CTO Balaji Srinivasan stated that on-chain lending will replace central banks with decentralized banking services, with interest rates determined by the market rather than fiat regulation. Although some P2P lending platforms still use centralized order books, decentralized P2P lending order books already exist, marking a shift in interest rate pricing models from central bank dominance to peer-to-peer market determination.

Token Terminal data shows that the current outstanding loans in the on-chain lending market are approaching a historical high of nearly $20 billion.

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