To function effectively, society has long depended on people having faith in their institutions. Thanks to the COVID-19 pandemic and wide-ranging failures of leadership, that faith has been tested like never before.
Nowhere is the decline in trust more evident than in the financial services sector. In its 2021 Trust Barometer, Edelman found that only 53% of American respondents said they trusted those in the U.S. to “do what is right” — down 5% from its 2020 survey. You can see this in the battle between Main Street and Wall Street, which played out in January’s GameStop rally. More than just another “short squeeze,” the rally highlighted the fact that many younger investors simply don’t believe in financial institutions.
Trending away from institutional authority is also evident in the explosive growth of decentralized finance, or DeFi. By using decentralized applications on the blockchain, DeFi allows individuals to lend or