Understanding Web3 and DeFi

The course will focus on what DeFi is, how it works, how Blockchain works, and, last but not least, what crypto currencies are and how they work.

The potential of Web3 lies in its decentralization, which enables peer-to-peer transactions. Decentralized Finance (DeFi) could be considered a subsector of Web3. While Web3 is predicated on using blockchain technology to create a more equitable internet, decentralized finance is Web3’s version of a more transparent financial system.

The potential of Web3 lies in its decentralization, which enables peer-to-peer transactions. It’s the decentralized internet — built on distributed technologies such as blockchain and decentralized autonomous organizations — that offers users greater control over data that once were stored in the servers owned by individuals or corporations. It’s considered to be the third major evolution of the internet, after the World Wide Web (Web1) and the user-generated web (Web2, or social media). 

Decentralized Finance (DeFi) could be considered a subsector of Web3. While Web3 is predicated on using blockchain technology to create a more equitable internet, decentralized finance is Web3’s version of a more transparent financial system. In order to achieve this purpose, DeFi is becoming a new paradigm that allows new forms of value and utility not seen within the traditional financial system. 

In other words, and broadly speaking, DeFi is an ambitious attempt to decentralize core traditional financial use cases like trading, lending, investment, wealth management, payment and insurance on the blockchain. DeFi is based on Decentralized Applications (dApps) or protocols 

Blockchain is undoubtedly key in the area of DeFi: If there was any doubt over the growing importance of Blockchain (and of the whole DeFi area in general), the ongoing COVID-19 pandemic, which has confronted the world with an unprecedented challenge, has turbocharged a fintech revolution worldwide in general, and a virtual banking revolution in particular. COVID-19 is changing consumer behavior, quite likely forever, and all the industries need to adapt, including the banking and financial services industry. Digital transformation has quickly become the top priority for countries not wanting to be left behind. 

Blockchain is undoubtedly changing the world. It is the technology likely to have the greatest impact on the future of the world economy. Even though blockchain is best known for underpinning the operation of crypto currencies such as Bitcoin, this technology can be used in countless other areas, such as banking, Central Bank Digital Currencies (CBDCs), healthcare, smart contracts, financial services, supply chain management, insurance, IoT, video games etc.

Crypto currencies are without any doubt one of the most famous DeFi applications, probably the flagship of the DeFi industry. 

This last year and a half, we have seen not only a surge in the price of most crypto currencies, among them Bitcoin, but we have also seen institutional investors become more interested in investing in cryptos. We have also seen companies like PayPal launching a new service enabling users to buy, hold and sell cryptos, as well as traditional banks like DBS launching a digital currency exchange that will allow investors to trade in cryptocurrencies and firms to raise funds through asset tokenization. 

However, regulators across the globe struggle to keep up with the pace of balancing state of the art technology with the use of traditional regulatory schemes. While some countries like Singapore are permissive with cryptos, others have banned it. 

This workshop focuses on what DeFi is, how it works, how Blockchain works, and, what crypto currencies are and how they work. 

OUTLINE OF THE WORKSHOP. 

DAY 1. 

1.- Introduction of the Instructor and the Course. 

2.-Round of Introductions: Introduction of each one of the attendees. 

EXERCISE 1 

DEBATE 1 

3.- Traditional Banks vs FinTech: a cooperation relationship nowadays rather than competition. 

EXERCISE 2 

DEBATE 2 

4.-Web3: 

• • Concept. 

• • Web 1- Web 2- Web 3… and, where is the future leading us to? 

• • Web 3 applications. 

5.-DeFi: 

• • What is DeFi. 

• • The DeFi Ecosystems. 

• • DeFi Use Cases. o Stablecoins 

• o Lending and Borrowing 

• o Trading on DEXes and Liquidity 

• o Synthetic Assets (Derivatives) 

• o Prediction Markets 

• o Staking 

• o Asset Management and Wallets 

• o Insurance and Risk Hedging 

• o Oracles 

• • DeFi opportunities. 

• • DeFi Risks. 

6.- Introduction to Blockchain 

a. What is Blockchain? 

b. How does Blockchain work? 

c. Applications of Blockchain 

i. Crypto currencies. 

ii. Central Bank Digital Currencies (CBDCs). 

iii. Smart contracts. 

iv. Healthcare. 

DAY 2 

7.- What are digital assets? 

8.- NFTs (Non-Fungible Tokens): 

• • Concept. 

• • The NFT market. 

• • NFT use cases. • Blockchain regulation across the globe. 

• 
  

Business Case 1, to be solved during the workshop and discussed that same first session. 

9.- Blockchain in Banking and Finance: 

• Blockchain in Banking: the role of DLT in Financial Services. Potential use cases and possible benefits. i. Trade Finance. 

ii. Payments. 

iii. Clearance and settlement systems. 

iv. Customer KYC and Fraud Prevention. 

v. Securities. 

vi. Loans and Credit. 

vii. Fundraising. 

viii. Accounting and auditing. 

ix. Others. 

a. Analysis of the concept. 

b. Overview of the main crypto currencies. 

c. Opportunities. 

d. Risks and challenges. 

e. Crypto regulation worldwide. 

f. Crypto wallets. 

DAY 3 

10.-Cryptocurrencies: 

11.- Central Bank Digital Currencies (CBDCs): The Future of Money? 

Business Case 2