The decentralized finance (DeFi) market of solutions, as of today, is a hot mess. Every time I explore a DeFi app, I find myself mostly trying to find the “learn more” button so as to understand what it is I am looking at.
If, as a crypto native, I still have to dive into the docs before completely understanding a product, what then can be expected of a random normie that is probably not going to think about searching the product website for documentation because they don't have the knowledge of such things existing around the corner?
There are primarily two things to expect:
The first possible outcome is that the normie will quickly click away and once that tab is closed, there's no coming back. If your target market feels dumb while exploring your product, they are unlikely to go through the trouble of “learning” just to use it.
The second possible outcome is that a small percentage of target users will compromise and jump on Google search to find answers and we all know what that means.
To be clear, jumping on Google isn't a guarantee that their challenges will be sorted out because they are very likely to find numerous generic, low-quality content before they can get to what they really want. Now, imagine the time cost. If people have to get into extensive research just to use your product, there is an almost guaranteed reality where they log off and never revisit that search history.
Sadly, this is the reality of DeFi today.
When you open a DeFi app, you find terms like yield, APY, APR, liquidity and TVL.
When we could have used terms like profits, interests, and money instead, so as to perfectly communicate with the broader market.
Why does this matter?
Here:
“Deposit $100 and earn 20% profits on your money yearly”
“Provide liquidity for 20% yield (or APY) on your assets”
Evidently, one is easy for anyone to understand, while the other is just technical and alienating by default.
We have to move to simplification. Sometimes it isn't even that the broader market can't understand these terms, it's that said terms are associated with a certain class of individuals that anyone that isn't a part of said class would feel a product isn't meant for them.
The use of yield, liquidity, assets, APY and TVL makes a product feel designed for specific groups of investors.
The masses, generally, have limited understanding of APY and how it differs from APR. They have limited understanding of compounding interests and how that influences realized gains.
What the masses do understand however is that companies can take “money” from them for a specific period of time and pay them simple “interests or profits.”
This is why it's more likely that a normie invests into a ponzi scheme than for them to interact with your DeFi shitcoin app paying 17,000% APR.
Both are essentially high risks and high rewards, yet the normies mostly invest in the traditional ponzi schemes, simply because it is easier to understand and get onboarded.
Simple DeFi is how crypto onboards the masses and their active capital. Right now, available products and their designs are tailored to a crypto native audience and generally, technical individuals.