Uh no, Aave has credit delegation for no collateral loans and it uses OpenLaw contracts to secure a credit line. And there's also TrueFi https://truefi.io/. And a bunch of others. You can get loans based on credit on Ethereum.
No, what I'm saying is that right now if you have a product on Ethereum with consistent cashflows, you can borrow money on credit from DAOs with large treasuries willing to lend them out using OpenLaw contracts as arbitration. The goal for these protocols is to expand this using decentralized identities and onchain credit scores.
If I can't buy a car on credit with DeFi it means DeFi can't do loans. And if it can't do loans it can't do finance. Maybe it can do a semblance of finance, maybe we can call it crippled finance, but it's not finance. Pretending that DeFi is going to turn everything upside down when it is unable to even make a simple loan is ridiculous. Nobody can take this seriously.
I can take a no collateral loan from DeFi today https://truefi.io/. So you can buy a car on credit using DeFi.
Also, this is early days. A few years ago HN's stance was that smart contracts are completely useless. Oh so now their not useless, but you can't get no collateral loans so it's not real finance. Right....
So what happens when I can get a decentralized identity and mortgage sized loans on DeFi in the next few years? This IS coming as there are at least a dozen projects working on this problem and there are already systems today that work, so it's only a matter of time.
Clearly you and many others in HN have blinders on because you were wrong to say that smart contracts are useless during the last crypto bubble. And over the years, you'll continue to be wrong as long as you bury your head in the sand. I'm absolutely confident about that.
As I suspected, I can't take a DeFi loan from https://truefi.io/. It's only open to a small number of vetted borrowers comprised of OTC desks and exchanges. Interesting to see how it works though. They say "delinquent borrowers will face legal action pursuant to the loan agreement signed", which means they're relying on the "legacy" legal system to enforce the loan agreement. In other words, it's not DeFi (surprise, surprise).
Are DeFi loans coming in the future? I have no idea, but right now it's not clear whether it's even possible to make loans with DeFi. No one has done it, so far. And loans are the most elementary of financial instruments.
Another problem with DeFi has to do with the very concept of decentralisation. For instance, these TruFi loans are approved or rejected by the lenders themselves. Another example, in a Dao, the shareholders assume management roles. Therefore, at least in these instances, decentralisation means replacing highly specialised workers with unpaid, non-specialised, informal labour. I think anyone can see that this is a dumb idea. A decentralised entity that is organised in this way will never be able to compete against a corporation that exploits division of labour and is professionalised.
