@harsfvey
DeFi credit markets excel in over-collateralized lending but struggle with under-collateralized credit, where TradFi dominates. On-chain identity, reputation, and RWAs could expand credit into productive lending. To rival TradFi, DeFi must move beyond pure speculation-driven borrowing and finance real economic activity. The potential exists: DeFi credit markets can offer transparency, global liquidity, and programmability. But until creditworthiness and enforcement mature, they remain limited compared to established financial systems.
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