Bitcoin was just the first step in a global financial revolution stemming from DeFi: decentralized finance. This concept was made possible with blockchain technology, which is a sort of electronic distributed ledger secured by cryptographic algorithms. But Bitcoin was simply the first step. In his new book, Beyond Bitcoin: Decentralized Finance and the End of Banks, co-authored by Simon Dingle, Steven Boykey Sidley describes the history of decentralized finance, the current status, and what’s to come.
Steven has worked extensively in technology and finance and is an award-winning novelist, playwright, and columnist. An American citizen, he currently lives in Johannesburg with his wife and their two children. Steven possesses an MSc in Computer Science from UCLA and is currently a partner with Bridge Capital.
What was the inspiration to write the “Beyond Bitcoin” book?
Steven: Bitcoin was the first and remains the most dominant of the blockchain applications starting in 2009. But we saw Defi first finding its feet in 2017 with a project called MakerDao, and exploding in mid-2020. By 2021 it became evident that Defi was going to threaten legacy interests including banks, insurance companies, exchanges, investment banks, and central banks. But us was hard to understand, at least for the non-technical, intellectually curious person. So we wrote the book to demystify was is clearly a transformative innovation. We cover the entire field, paint the landscape, the people, the chronology, and the projects. Without too much jargon and with the right mix of enthusiasm and skepticism
Are there any projects or use cases within the DeFi space that you are particularly interested in?
Steven: The core projects - banking, exchanges, insurance, and derivatives are all interesting and powerful re-engineering of existing services. But the projects that are doing things that have never been seen before are even more interesting: yield farming, streaming money, NFTs, DAOs, etc. There will be many more of these to come.
Do you see a consolidation with regard to the DeFi space, given the sheer amount of options available to investors?
Steven: Yes, definitely. Too many projects out there. Even some of the good ones will not be able to sustain themselves. It would be a fool’s errand to bet, but take a look at the top 10 Defi genre projects like Aave/Compound and Crv and Uniswap and Yearn and Synthetix. They are likely to be around for a long time.
Did your prior experience in the fintech industry lead you to cryptocurrencies at an early date?
Steven: Yes, I have been in deep tech for a long time, starting with an MSc in Computer Science from UCLA and starting my career as a developer. I later wormed my way up to CTO for various companies and then into investments and startups and entrepreneurial ventures. But I was relatively late to crypto: 2017, unlike my co-author Simon who had been there since the beginning. But it hit me with full force rather quickly and by mid-2017 I was a keen acolyte and investor, glued to the industry daily.
What's the consensus amongst the executive class about the way the world of finance is headed? How long has the writing been on the wall in relation to the legacy banking sector?
Steven: Few financial execs had heard of Defi when we started writing, and those that had considered it rubbish or poison. By mid-2021 they had all heard of it, and hated it, or didn't have a clue how it worked. Now every major financial institution in the world has dipped one or more toes in the Defi waters, and 2022 will be the year you will see commercial offerings from the banks, probably in collaboration with some of the big Defi projects like Aave.
It seems that authors still have no real decentralized networks to spread the word about their new works, relying on centralized social media and Amazon. Do you see any interesting innovations in terms of blockchains targeting the publishing industry as opposed to Defi?
Steven: Ah, a huge bugbear and sore point. Publishing is still largely centralized. Book marketing is still largely centralized. Bookselling is completely dominated by Amazon, Change is coming. It is called Web 3.
What are you currently focused on now that the book is published?
Steven: Another book. Details to follow!. Oh, and a slew of engagement with institutions looking to learn about Defi. Teaching and presenting are satisfying and fun.
