John Cunliffe, deputy governor of the Bank of England, has pointed out that decentralized protocols (DeFi) do not yet provide an efficient way to manage risk.
According to him:
"From the standpoint of a financial stability authority and a financial regulator, I have yet to be convinced that the risks inherent in finance can be effectively managed in this way."
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He has compared DeFi protocols to autonomous cars. In his opinion, "they are only as good as the rules, program and sensors which organize their operations." At the same time, Cunliffe has questioned the degree of decentralization of the projects:
"These protocols typically sit firms and stakeholders who derive revenue from their operations. Moreover it is often unclear who, in practice, controls the governance of the protocols."
The bank's deputy governor has also pointed to the need to develop strong consumer protection measures in the wake of the FTX collapse.