Overview
Most decentralized finance (DeFi) discussions focus on the importance of the underlying immutable distributed ledger and the cryptocurrency used as the medium of value exchange. But perhaps the more important component of DeFi solutions is the actual smart contract technology. While risks associated with cryptocurrencies are often the topic of discussion, little is said about the risks associated with smart contracts; and there are significant risks to consider.
This Viewpoint will analyze smart contracts and the issues that could arise if used to support two common payment card scenarios: (1) to enable cryptocurrencies to mimic a common pre-authorization transaction, such as done when paying at the table in restaurants or pumping gas at an automated fuel pump and (2) to create support for a traditional card-based recurring payment relationship.
Learn More About This Report & Javelin
Related content
Five Ways Assertive Regulators Will Shape the Future of Payments
The past few years have seen an increased role for U.S. regulators across financial services, with crackdowns against banking partnerships, crypto coin minters, credit card issuers...
Fintech Investment Trends: Waiting for the Next Wave
The widespread pullback from fintech investment in 2023 is gone as the payments space plunges deeper into 2024, but the priorities have shifted. New and emerging fintechs are focus...
Generative AI Comes to Life: Notes from the Field
Generative AI has been around for over a year now and has dominated discussions about how the emerging technology stands to transform payments. This Javelin Strategy & Research rep...
Make informed decisions in a digital financial world