Neobanks
Neobanks like Revolut and Mercury are user experience startups rather than true banking institutions. They are tech products that simplify finance while still depending entirely on the old architecture.
Most neobanks cannot offer traditional business loans or credit lines without relying on centralized pools of capital. This is why, when you need a $100k–$300k mortgage to buy a house, you still walk into a big bank, not a neobank you use for daily finances. When you need large financing for serious purchases, you go to serious institutions.
Real banks continue to control money creation and operate the key infrastructure for fiat that powers the global economy. If we can create infrastructure to solve this, for example by issuing mortgages and credit globally at scale so that a Dubai fund can invest in home loans in Brazil, or an Indian farmer can borrow from a pool of DeFi capital, we can make credit markets fully auditable onchain, with privacy preserved, while knowing in real time the health of any pool or tranche.
This reduces dependency on big banks and, by extension, the central banks that dictate interest rates. They may still print fiat, but if most economic credit is issued onchain and decentralized, their policy rate becomes less relevant or is forced to adapt to free market needs. In turn, this fulfills the purpose of reducing fiat dependence.
The outcome is stronger property rights for over 5 billion people worldwide who today hold less than 43% of secure property rights.
Vitalik shares the same vision, Unsecured credit is a powerful engine for financial inclusion.
" Once we have a mature ecosystem of financial and non-financial activity happening onchain (see: Balaji's ledger of record concept), it starts to make sense to explore reputation-based undercollateralized lending, which is potentially an even more powerful engine of financial inclusion. Both the low-risk defi we build today, and the non-financial wizardry (eg. ZK identity) we build today, are upstream of making this outcome more likely. "
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