Decentralized Finance (DeFi), a blockchain powered peer-to-peer financial system, is mushrooming. One and a half years ago the total value locked in DeFi systems was approximately 700m USD, now, as of November 2021, it stands at around 100bn USD. The frenetic evolution of the ecosystem has created challenges in understanding the basic principles of these systems and their security risks.

In this talk, I delineate the DeFi ecosystem along the following axes: its primitives, its operational protocol types and its security. I distinguish between technical security, which has a healthy literature, and economic security, which is largely unexplored, connecting the latter with new models and thereby synthesizing insights from computer science, economics and finance. Finally, I turn to the open research challenges in the ecosystem, and try to answer the question: is this Finance 2.0?

Bio: Lewis Gudgeon is a fourth year PhD Candidate in the Computer Science Department at Imperial College London, supervised by Professor William Knottenbelt. His background is primarily in Economics, having first studied Philosophy, Politics and Economics as an undergraduate followed by a MPhil in Economics Research at the University of Cambridge. His work focuses on DeFi systems, particularly the design, behaviour and risks of protocols for borrowing and saving (Protocols for Loanable Funds) and stablecoins.

You will receive the Zoom link for this talk in the seminar registration confirmation email after you register through the following link: http://www.fields.utoronto.ca/cgi-bin/register?form_selection=blockchain...