Several blockchain products are out to disrupt the traditional banking system and one of such products is Clever DeFi. The traditional banking system has had its shortcomings over the years, and change is certainly inevitable. Since its inception, never have the traditional banking system been threatened as it is today. Faced with the revolutionizing technology of blockchain and cryptocurrency, the global financial system can either evolve or go into oblivion.
Not only do we see the exponential growth of decentralized finance like Clever protocol, full crypto banks have become a reality. The rise of these crypto banks has made the limitations of the traditional banking systems more glaring. Today, we have a number of DeFi projects offering superior financial services to users than traditional banks.
What is Clever DeFi?
It is a decentralized finance (DeFi) protocol that pays automatic interests to all Clever token (CLVA) holders. In a nutshell, Clever is one smart way to store your wealth and be guaranteed a significantly greater interest than traditional banks. It is a community-owned, the first fully autonomous compound interest protocol in the crypto space.
There is also 11% compound interest paid fortnightly, and it is guaranteed for all CLVA token holders. You receive interest every 14 days, and the payouts are hardcoded into the smart contracts. Clever functions like an autonomous savings bank. You receive interest based on the amount of CLVA tokens in your wallet balance. Most of these banks pay little or no interest on the money you have deposited with them.
As an investor, Clever helps you to guarantee the true ownership of your wealth. All CLVA tokens are securely kept on the Ethereum blockchain, where you cannot access any wallet without the appropriate private keys. Unlike most of the yield farming protocols, Clever DeFi does not require users to stake or invest their tokens for a specified period.
The Problems Facing Traditional Banking System
To help us better understand the solutions of Clever, let us explore some of the key laws of traditional banking.
- Trust to a centralized body.
Over the years, corporate financial establishments like banks have given people enough reasons not to trust them. The issue of recession and bankruptcy has made bank users skeptical about trusting the system to be there for them. There have also been so many scandals that have given the banking industry quite a bad reputation. We have seen cases where taxpayer’s money has been used to rescue banks. Today, bailout funds for traditional financial institutions have become the norm. If a bank cannot take care of itself, how will it take care of my money?
- Bail-in laws allowing banks to take our money
During the recession crisis of 2008, many regulators and politicians coined the term “too big to fail” as a rationale to rescue large financial institutions with the taxpayers’ money. In bail-ins, banks can use the money of their unsecured creditors, depositors, and bondholders, to enable them to stay afloat.
- Low savings interest rates
On average, banks give only 2% per year interest on savings. Nobody wants such in today’s world where there are a lot of businesses you can invest in. This is why most people are moving away from traditional banking systems and embracing disruptive products like DeFi.
Clever DeFi Solutions
With Clever, you are in complete control of your CLVA token holdings, your own keys, and your wallets. You don’t rely on any centralized entity to control how you spend your holdings. The system also distributes interest up to 11%, unlike the 2% most traditional banks give their savers. There is also a guaranteed compound interest every 14 days, amounting to 307% per year.
We will continue to see more disruptive DeFi projects like Clever DeFi emerge in the crypto industry. It is time for the traditional banking system to adopt an effective, innovative approach to remain relevant. Without innovation to accommodate the current trend, the global financial system is bound to be left behind.
Andrew is a writer that does most of his work on cryptocurrency-related topics. While he’s primarily interested in Bitcoin, he also follows major altcoins and the innovative ideas that new cryptocurrency and blockchain projects are bringing to the table.