Financial Stability Board, Assessment of Risks to Financial Stability from Cryptoassets (Feb. 2022)
- Has a 3- page section on DeFi
- The general tone sound very much like that in the OECD’s recent DeFi report. Rights attached to governance tokens “could be understood to be analogous to shareholders’ voting rights in traditional finance”. Although DeFi platforms “purport” to rely on governance tokenholders for voting, “in practice, governance may be concentrated, including through the use of committee structures for management purposes with regular meetings held through social media platforms” or individuals associated with the project who hold “disproportionately large portions” of the total token supply. “Without sufficient regulation and market oversight, DeFi and associated platforms, might present risks to financial stability. Some of these risks are becoming apparent, such as concentration risk in terms of protocols and technology used. The sector has already seen numerous operational and cybersecurity incidents, and failures of governance,” the report added.