DeFi & Beyond: This Is Not Financial Advice Ether Knight | Chris Bradbury - Summer.fi, Maria Magenes

For this panel we have Maxim de Draper. No, it's not here. She's not here. Maria. I.

Yes, and we have Chris from Summerfi and we're going to talk about everything related to DeFi and beyond. Okay , so this...Thanks, sis. This was supposed to be a panel, but now it's a conversation, and interestingly, I used to work with Chris and he was my boss, and now I've changed, I moved into a marketing agency role , but I was involved in DeFi for many years. So that's what we'll be talking about today.

So the first question for you is, Chris, I actually want you to introduce yourself and Summer, and what you do. Hi, I'm Chris. Good. So, hello. Yes, I'm Chris, the CEO of Summerfi.

We have been present since 2019 as a DeFi aggregation platform. Originally Oasis.app, we separated from Maker in 2021. We were the original interface for Maker, the Maker protocol. In recent weeks we have launched our second generation of performance aggregation platform.

We hope to take DeFi further, as we're here to talk, and attract a whole new group of users in the future and beyond. Very good. Next question. Is DeFi still relevant? I mean, are DeFi still relevant?

I mean, are we...the purpose, as you said of Summerfi, and hopefully of some apps and projects that are emerging now, to attract new people? But my impression, from a slightly outsider's perspective now, is that DeFi projects are always talking to the same users are always talking to the same users . Competing for the same users and then rotating the same liquidity over and over again . So, what's your take on how we can actually attract new users?

Yes, I think we're almost at the limit. Obviously, there are still new users entering DeFi and so on, but I think we're still stuck in this mentality that all new DeFi users have to come and use DeFi interfaces. Whether they are protocol interfaces or different aggregation interfaces, etc. I think that concept is coming to an end now, because we'll never attract the next 100 million users to DeFi interfaces using wallets like MetaMask or whatever. We just heard them talk a little bit about wallet abstraction and so on, but I think that, actually, DeFi still has a great future.

DeFi remains relevant, but attracting the next 100 million users to DeFi means integrating its protocols into the applications and services that people already use today in the Web 2.0 world. That is, fintech applications, savings apps, and so on, enabling and exposing DeFi to those users in that way. Understood. But do you think we need...?

Who in the audience isn't using DeFi right now? You are all using DeFi. Okay, we have a good audience here. But now imagine you're talking to... I don't know, I don't want to say my mother because that's too much, but maybe my father, who 's an engineer, so he's quite capable, you know?

Do you think he could be a user now, or maybe in three years, a DeFi user? Right now I think it could be. With what we've done in the industry, such as registration via email or social networks, and the on-ramps that have existed for years, you can now buy crypto from an app. You can abstract... You can abstract gas commissions and all that using layer 2 (L2) networks.

Yes, that's what I mean. So yes, they may be able to use it, but the big problem right now is that it's still very complex. Hopefully, in a year or two, they might be able to use it without even knowing they're using DeFi. If we can connect DeFi infrastructures to the products they already use, we could offer them savings rates of 7, 8, 9, or 10%, which can now be easily obtained in DeFi with low-risk strategies. So, maybe they can end up using it.

Or they could use it through other means, such as fund managers who invest their money in DeFi and liquidity pools. So I don't think users need to know they're using DeFi to actually be using it. But today, it's perhaps 25% But today, it's perhaps 25% better. There's probably a one in four chance that your father will understand how to get in and how to use it. But, hopefully, in two years you'll be using it without even realizing you 're using it.

Another question. Well, I'm going to skip the question I had in mind because it's a bit complex, so I'll ask it later. But now I want to ask you, do you think Ethereum is still the best chain for DeFi? Because we are seeing many other L2, sorry, L1, and many chains other L2, sorry, L1, and many chains , such as DeFi on Solana or even DeFi on Bitcoin. What do you think, and how do you think this works?

Because there is a lot of fragmentation and, as I said before, the liquidity is the same, but it is being dispersed across all the chains, and that is my question. And why do you think Ethereum is still the best, if you do ? Well, yes, I still think Ethereum is the center of DeFi. That's where most of the liquidity and other assets are still located. But I also believe that, when we talk about L2, especially those based on EVM and originating from Ethereum, they are still within the Ethereum ecosystem.

They still rely on the underlying Ethereum blockchain for security and, ultimately, for all accounting. Ethereum remains the source of validation that allows DeFi to operate in L2 and beyond. I agree that there is a lot of liquidity fragmentation, although not so much of users. I think most users, and probably many here, have balances in multiple chains at the same time. But yes, I think that's the next big challenge: abstracting the concept of a chain.

Having DeFi protocols and products available across chains, without users needing to know which chain they are operating on. Being able to deposit into a chain operating on. Being able to deposit into a chain , let's say Base, if you happen to be in Arbitrum on another application, and being able to withdraw in Arbitrum, simply seeing a single aggregated balance from all of them. So, under the hood, you don't see everything that's happening behind the scenes, and I think that's the next definitive stage for DeFi. Yes, because I believe that from a marketing perspective, since I am a marketing expert, it is very difficult to explain to the user how to use a particular project.

For example, I noticed that the new interface they launched is much simpler than what I used to see when I worked at Summer, because now you can connect with email. There are many things, it's very simple, so I think that, in general, one of the barriers to getting started is the user experience. There is fragmentation, many chains, bad interfaces; Developers focus more on how complex the smart contract is than on actually improving the user experience. That's what I've noticed. The next question is, uh, DeFi, when I entered it 7 years ago, my goal was to create a new open, trustless, free financial system, etc.

Without intermediaries to bring banking services to the unbanked, banking services to the unbanked, you know? Now I see that we're talking about staking, annual returns, and making the rich richer. What do you think about this? Do you believe that the idea of ​​DeFi as something to save the world still exists, or is it just for those who want to make money? Yes, I think so, even if you want to bring banking services to the unbanked, or however you say that phrase.

It seems like we used that a long time ago. But there still has to be a reason why they want to use it and so on. And, in the end, that means it gives them something. And in most cases, it's not just about giving them a wallet to transfer money to. That could be part of a use case, perhaps.

But now there are other ways to do that easily without needing to use blockchain and all that. But you have to offer them something. All users use a product because it makes them feel better or they feel they are gaining something. And in this case, when it comes to returns, they can make money with US dollars. They can have US dollars.

If they're going to have dollars, they might as well make a profit with them. But if they can earn with their dollars in USDC, USDT, USDS or whatever, then those with a lot of money can do it too . I think it's difficult to build a system that manages to connect the unbanked without it ending up being dominated by people with money and resources. It's very complicated, but I think we can create products that are available to them; Although, as you say, there's the issue of user experience, availability, and accessibility. The original visions of trustless systems and all that.

Everyone still needs to use a user interface. So we haven't gotten over that; The "no trust" comment was perhaps intended for the 0.1% of the user base capable of interacting with a blockchain without an interface. That's why we continue to depend on interfaces. You talked about user experience and other aspects.

And it's improving a little. Although I still think we have a long way to go. I tried to get my best friend to start using the product. And he literally asked me, "What is DeFi and what does APY mean?" So yes, DeFi is still full of technical jargon.

It is full of terminology that only experts understand. We all know what it means and how to use it. But if you show this to someone outside the industry and say, "Try it and I'll pay you if you tell me what you think." He was stuck on the homepage because he didn't even know what APY meant. That's how things are.

I think it's a good exercise for everyone here, and for those outside this conference, to try to add a friend who doesn't use blockchain technology. It's interesting because I've heard a lot about this, and they do n't really say anything. You're sure n't really say anything. You're sure ? You realize that...

and they are educated people. We're not talking about my grandmother, you know. So we all need to strive to explain things better, build more understandable tools, and so on. And speaking of that... I'd like to know your opinion on how artificial intelligence could help with this.

I saw that they are using AI in Summer and I think it could be a great help in improving not only the project, but also the user experience. I want to know how they use it and what their idea is. Yes, we use AI agents as guardians within the Summer protocol to perform rebalancing. The Summer protocol, as I said, is a performance aggregation protocol that automatically rebalances user funds towards the best-performing protocols in supported markets. supported markets.

Yes, rebalancing works through AI agents. The way it currently works is that we have five AI agents, each operating with a different model and connected to a multi-signature. And if at least three of the agents propose the same rebalancing strategy, then the rebalancing is executed. It's great, because we could just program it and use the code of a single developer, but now we have these individual agents that, in a way, verify the information with each other. We have seen in the records that sometimes one or two agents propose different strategies to the rest.

This is how we use AI to improve the user experience, especially for those who usually rebalance manually. You no longer have to rely on a single code that could make a mistake or move money where it shouldn't. It wouldn't be a serious problem if it moved to another platform either; performance would just decrease, but this almost guarantees that it will always go to the highest-performing platform within the risk limits. I believe AI has a big role to play, especially in helping users with onboarding by eliminating many steps; Although there's still a long way to go, we're making progress every year, which is the best thing. We've known each other forever.

What do you think has changed in the DeFi landscape? How have we evolved since 2018, when we both joined the sector 2018, when we both joined the sector ? Seven years have already passed. What do you think? I want your...

Yes, I mean, the only thing from, let's say, 2018 is the original Maker Dai panel. I don't know how many of you used the original Dai dashboard on Maker, but it required seven or eight transactions to deposit your ETH and mint Dai. You had to wrap your ETH. Then you had to convert your WETH to PETH. Then you had to pass the PETH.

Then you had to deposit the PETH and withdraw the Dai. It was a kind of absolute nightmare. So, obviously, we've made huge strides there. Now, practically speaking, a maximum of two transactions are required at any given time thanks to multi-layered contracts and so on. You can perform many multiple steps within a single transaction.

That's part of it too. However, wallet connections and all that are another matter. The way wallets are managed in apps has come a long way since 2018. And something that went up and then down again is, obviously, the cost of transactions and so on. In 2018, if the gas price exceeded one gwei, it was an expensive day to trade on Ethereum.

They were like one or one and a half gwei to operate. Those were crazy days back in 2019 and 2020 when it all started. Then we had COVID and the DeFi summer of 2020, when yield farming started to take off. And gas prices reached 800 or 900 gwei. It was terrible, we lost many retail users on Ethereum because it was the days leading up to the L2 and so on.

Transferring a stablecoin sometimes cost $30 or $40 to send $10 of Dai. So, when we talk about bringing the unbanked into the banking system or something like that, 2020 and 2021 were disastrous years, because suddenly it cost more to send the money than the amount you were sending. Now, with L2, Base, Arbitrum, Optimism, the superchain and others, gas prices have dropped back down to three, four or five gwei most days. You can use L2 to transfer stablecoins for less than a penny. And that has been the truly important thing.

But I mean , in a way it's like going back to the days of 2018, where that's what it cost in the beginning, when there were probably only a couple of thousand people using Ethereum, or maybe a few tens of thousands. Now we have millions of people operating in the chain and we have managed to reduce gas costs with the scalability of multiple chains and more. Uh, the last one I think, yes, question. I agree. I mean, I remember when I joined Ethlend.

The previous thing was terrible, terrible. The user interface wasn't even that good, it's true, but I think we haven't evolved enough yet, especially from the interface perspective. It's still too complex, in my opinion, sometimes to accomplish what you need to do, even for those already on-chain, let alone for those not in DeFi. So, yes. The last question I want to ask, I've now forgotten it.

One second. No, it's fine. I already have it. Recently, especially lately, I keep hearing "DeFi project, the best DeFi project", etc. And sometimes I check it and it's not decentralized, I mean, it 's not decentralized.

So I want you to explain to yourself and the audience what decentralized finance really means, because sometimes we, especially ordinary people, when we hear crypto, immediately say, "okay, it's DeFi." No. So please, as an expert. That's what we call it. Too far.

But, um, yes, I mean, cases like Celsius and others kind of ruined the image of DeFi back in '21 and '22 and so on. But, I mean, DeFi is essentially all about the ability to be non-custodial and self-custodial of your funds. So, if you have control of your funds at all times, meaning you can deposit and withdraw whenever you want, that's a decentralized finance application. I 'm literally losing my voice. Um, but yes 'm literally losing my voice.

Um, but yes , and ultimately, it means there is no centralized control behind the scenes. Oh. So yes, if it 's controlled by governance, if we have multiple DeFi projects that are multi-signature and so on. They are still are multi-signature and so on. They are still , yes, semi-reliable, but you are relying on people with multi-signature authority to execute perhaps the will of governance and so on.

But truly decentralized finance consists of trustless protocols that operate under a decentralized governance model. In other words, token holders vote on everything directly on the chain. You could take it to the extreme, where the deployed products are completely immutable. Like liquidity and things like that . And so on.

Therefore, their markets are completely immutable. You can't even update them, among other things update them, among other things . They are completely unguarded. So you have control of your assets at all times. The moment you hand over your assets to someone else, they take control and can block access to your account.

That's where DeFi ends, and everything else. Okay, we have 4 seconds. 3, 2, 1. Guys, start using DeFi and invite your friends to Summer Fi or any DeFi project. Thank you.