As Decentralized Finance (DeFi) plays an increasingly pivotal role in financial services – from transaction banking to wealth management – institutions must invest in bridging the emerging skill gap and help its professionals embrace opportunity.
The rise of Decentralized Finance (DeFi) has been nothing short of meteoric. DeFi protocols and platforms are growing in importance as fintechs, established financial service institutions (FSIs), and even central banks explore its applications. Many are developing DeFi solutions in areas such as transaction banking, wealth management and capital markets. Asset and wealth managers are evaluating whether crypto assets can be beneficial diversification instruments. Meanwhile, regulations are being firmed up and finalized in markets like the US, UK, Singapore, Hong Kong, Australia, the EU, UAE and Canada. This regulatory momentum will help institutions seize opportunities in the potentially very lucrative DeFi space.
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While DeFi has the potential to democratize finance and increase financial inclusion, there are several knowledge gaps that are hindering its growth and development. Currently, there just isn’t enough awareness of, or confidence with, the DeFi topic to enable institutions to effectively navigate this complex ecosystem and embrace the opportunity it offers.
Moreover, as DeFi is still in its early stages and regulations are in the works, this lack of regulatory oversight combined with lack of skills / foundational understanding creates a fertile ground for bad actors to exploit the system and engage in fraudulent activities (e.g. Poly Network).
The pace of innovation is another significant factor contributing to the skills gap in the DeFi space. DeFi protocols and platforms are constantly evolving, and new concepts and technologies are emerging regularly that are expanding the ecosystem to new frontiers. To stay relevant and competitive, professionals must continually update their skills and knowledge.
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The skills gap in DeFi is a pressing issue that needs urgent attention. Learning and development (L&D) teams can play a vital role in addressing this gap. Here are some actions that L&D teams can take to address the skills gap in the DeFi space:
- Develop / implement training programs that cover the basics of blockchain technology and DeFi concepts.
- Provide up-to-date information on the latest DeFi protocols and platforms and the expanding universe of applications.
- Offer training on risk management, security, and compliance.
- Equip your sales and customer teams with the language and know how to better engage with their clients on the topic- addressing both the risks and the opportunities.
- Develop mentorship programs that pair experienced DeFi professionals with new entrants.
The DeFi space is a fast-paced and constantly evolving environment that requires professionals to be up to date with the latest technologies, regulations, and risks. The skills gap in DeFi is a significant challenge that must be addressed urgently. By developing comprehensive training programs, offering mentorship opportunities, and promoting continuous learning and development, L&D teams can play a crucial role in closing the skills gap in the DeFi space.
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