Source: Tyler Cowen & Alex Tabarrok, “Cryptoeconomics” in Modern Principles of Economics (5th ed., 2021) — Bitcoin, Beyond Bitcoin, Intro DeFi Sections, pdf pgs. 8-19.
The first section of the textbook on cryptography (see Field Note #9) outperforms the second half of this text, which constitutes a general introduction to wide sweep of concepts from Bitcoin's primitives to smart contracts to decentralized finance.
Some prompts / "notes to self" for continued reflection:
- Don't underweight the "creative" component of the phrase creative destruction. “DeFi is a field dominated by creative destruction, namely that new products displace older products at a high rate.” (Id. at 17).
- Americentrism & Eurocentrism bias might obscure decentralized finance's potential. Often, uncritical commentary strictly associates DeFi with the so-called "degen," straightjacketing creativity. "Decentralized finance, therefore, could be broader based and more open than traditional finance. Indeed, decentralized finance could prosper in precisely those regions of the world that do not have reliable legal systems or governments with the power to regulate heavily." (Id. at 18)