US Federal Reserve discussion paper takes cold, hard look at DeFi, gives it mixed review By Cointelegraph

There are more than 1,400 DApps in operation and their number is growing rapidly, according to a United States Federal Reserve Board discussion paper dated in June but released on Aug. 30. is their biggest host with 470, or 31%, of them. Those decentralized finance (DeFi) products represent a very small share of the global financial system, but may still pose risks to financial stability, the authors said.

The cumulative gross value of DeFi products ranged from $78 billion to $224 billion at the beginning of the second quarter of 2022, depending on how DeFi was defined, the paper said. Those figures have fallen dramatically since then, as the crypto winter descended. At the same time, technological developments are improving DeFi’s processing capacity. The authors speculate that wholesale investors are the biggest DeFi users.