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“When I started to read about smart contracts… my mind exploded.”

That’s Stani Kulechov, founder and CEO of Aave, who joined host Frank Chaparro for the latest episode of The Scoop podcast to discuss his entry into the world of decentralized finance (DeFi) and offer a deep dive into Aave’s ecosystem. 

Among the topics: Aave Arc, the project’s institutional product. During the conversation, Kulechov said that he believes smaller banks and private firms will be among the institutional world’s early adopters of DeFi.

“I think the biggest banks are more in the state of actually learning and getting education on the fly, and they will not be the early movers,” he said. “But the early movers will be the banks that are smaller banks, private banks, and are exposed one way into the crypto space.”

‘MetaFi’

As one might expect, the interview with Kulechov swung toward a popular one in the crypto space today: virtual worlds, gaming and the so-called Metaverse, the latter being a catch-all phrase for the different platforms and services that compromise an immersive digital experience.

Kulechov likened the way users spend time playing games in the Metaverse to the way people log time in a physical space like a cafe or workspace.

“Games becomes more of an economy the same way as we’re spending times sitting in a cafe, workspaces or having dinners or meeting friends.” He also related the use of finance tools in DeFi protocols to playing games and shopping in a brand’s store in the metaverse. 

For Aave in particular, this area is being explored via the launch of Aavegotchi, which began its first land auctions this October. “It’s just like a completely new world that can be not just an experiment, but it could become reality,” said Kulechov.

Beyond DeFi

While DeFi remains the focus of Aave, Kulechov sees a range of possibilities for similar architectures outside of DeFi.

Kulechov discovered that while DeFi protocols applied nicely to finance, a similar architecture could be created to build a social platform. Aave is currently working on this Ethereum-based Twitter alternative meant to give users more control over their content.

“You don’t have this component where you have this centralized entity abstracting the value from the users and bringing the value to the shareholders,” he explained. “Instead, the community owns the network and also you own the social graph and you can decide how you monetize it.” 

© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.