OFR, Report: Risk Spotlight, OFR Identifies Three Ways DeFi Growth Could Threaten Financial Stability
Page(s): 2
“If decentralized finance (DeFi) continues to grow in size and scope, and if it continues to lack the guardrails that exist for traditional finance, then it could become a threat to financial stability. This blog post summarizes three channels through which threats could emerge in the DeFi market.”
“1. Effects from Price Declines of Digital Assets Could Spill Over into Traditional Financial Markets.”
“2. Rapid Withdrawals of Digital Assets Could Create Losses for Traditional Financial Institutions.”
“3. Disruptions Would Have Immediate Consequences If Digital Assets Were Widely Used as Payment.”