📋 Written Ability Test (WAT)/Essay Analysis Guide

Should the Global Financial System Move Toward Decentralized Finance (DeFi)?

🌐 Understanding DeFi’s Importance

DeFi’s potential to transform the global financial system through transparency and accessibility makes it a vital topic for B-school applicants.

📝 Effective Planning and Writing

• Time Allocation: Planning – 5 mins; Writing – 20 mins; Review – 5 mins.
• Preparation Tips: Note key statistics and highlight stakeholders (e.g., governments, consumers).

💡 Introduction Techniques for Essays

• Contrast Approach: “While DeFi eliminates intermediaries, its security challenges cast doubt on mass adoption.”
• Solution-Based Approach: “Regulating DeFi could unlock its potential to revolutionize global finance.”
• Timeline Approach: “From Bitcoin’s inception to $120 billion in locked DeFi assets, the evolution of decentralized systems reflects a paradigm shift.”

📚 Structuring the Essay Body

• Achievements: Highlight successes like financial inclusion, using statistics (e.g., $120 billion in smart contracts).
• Challenges with Comparative Analysis: Discuss risks (e.g., $1.2 billion lost annually) while referencing global benchmarks.
• Future Outlook: Suggest solutions like regulatory frameworks and scalability innovations.

📌 Concluding Effectively

• Balanced Approach: “DeFi’s potential lies in its scalability, but requires regulatory and security advancements.”
• Global Comparison: “Countries adopting blockchain illustrate DeFi’s potential, but global collaboration is key.”

📊 Analyzing Successes and Shortcomings

• Key Achievements: Financial inclusion, reduced fees, transparency.
• Ongoing Challenges: Security breaches, lack of universal regulation.
• Global Context: Case studies of Estonia (success) and Nigeria (challenges).

🏆 Recommendations for Sustainable Progress

• Standardized global regulations.
• Investment in blockchain security.
• Collaboration between traditional finance and DeFi innovators.

✍️ Sample Short Essays

• Balanced Perspective: “DeFi offers transparency and inclusivity, but adoption requires overcoming security risks and regulatory barriers.”
• Solution-Oriented: “Global regulations can help DeFi scale as a secure and inclusive financial system.”
• Global Comparison: “Success in countries like Estonia highlights DeFi’s potential, yet challenges in Nigeria show the need for clear policies.”