I’m a HUGE advocate for using DeFi on Ethereum as I think CeFi has completely opposite fundamentals from what crypto was initially created for, yet a lot of people still use it simply because it’s much easier.
A lot of people (especially newcomers to Ethereum) feel very intimidated by DeFi and the many things that one would need to learn about before starting that journey.
Impermanent loss, liquidity pools, flash loans, oracles, and everything in between. These are things that some people take weeks and even months to fully learn about and understand, so a lot of these people end up using centralized finance instead because it does the job for them.
That ease of use and user friendliness comes at a cost though and that is loss of custody and control over funds on the platform.
But none the less, this intimidation is definitely standing in the way of DeFi’s growth.
Another argument would be that CeFi fees are way lower but I think this argument grew irrelevant with time since more and more Ethereum based swaps and DEXs started building on L2s and commit chains.
We’ve all seen the boost in DeFi that some commit chains like Polygon ended up providing with the inclusion of swaps and DEXs including some like Quickswap, Uniswap, Meshswap, and 1inch.
These swaps and DEXs rival CEXs in terms of speed and affordability but we yet again go back to the problem of user friendliness. And while the ones I mentioned lean more toward the more user friendly experience, most DeFi platforms on the market aren’t.
You simply can use these platforms before you do a decent amount of research especially when there’s a lot of money involved.
If we don’t start seeing new development in the UI sector and user friendly experience from the entirety of the DeFi market, we might not be able to reach any form of mainstream adoption.
