Bank of International Settlement calls the rise of decentralized finance ‘an illusion’ in

On Monday, the Bank of International Settlement, or BIS, a financial institution owned by central banks worldwide, published a report scrutinizing the development of the decentralized finance, or DeFi, industry. The article opened by saying, “There is a “decentralization illusion” in DeFi since the need for governance makes some level of centralization inevitable, and structural aspects of the system lead to a concentration of power.” It continued:

According to BIS, all DeFi protocols have inherent elements of centralization due to their central governance frameworks, in a way similar to legal entities such as corporations. In addition, certain DeFi blockchains concentrate power at the hands of large coin-holders or to insiders in token sales.