The Finternet is the direction Web3 should have been heading towards all along.

I’ve spent the last few days reading up on the Finternet and its proposed mechanisms, and I’m genuinely excited about what it could achieve. There’s so much potential here, and I wanted to jot down why I think the Finternet is the direction Web3 should have been heading toward all along.

Web3 has already delivered some amazing things, especially when it comes to empowering creators and offering new forms of social interaction—take Farcaster as an example. But for the common person, we still have a long way to go in terms of adoption. Much of Web3 today is fragmented, and while DeFi has incredible use cases, it’s still alien to most people. The Finternet can bridge that gap by bringing the power of DeFi and decentralized tech to a much broader audience.

The Finternet feels like what Web3 promised but hasn’t fully delivered on yet. It’s user-centric, unified, interoperable, and universal.

Ethereum laid a solid foundation, both technically and philosophically, for a decentralized future. The Finternet brings back that early “Ethereum” vibe, where the ethos was about building something truly revolutionary with real-world utility.

So, the Finternet, proposed by Agustín Carstens, Nandan Nilekani, Siddharth Shetty, and Pramod Varma, is basically a comprehensive digital financial infrastructure that integrates different asset types, sectors, and geographies into a single, interoperable system. Its goal is to enhance financial inclusion, efficiency, and innovation, while making sure it’s regulatory-compliant.

Here’s what excites me:

1. The Finternet combines the best of both worlds. You get the stability and compliance of traditional finance, while also bringing in the innovation and user empowerment that Web3 stands for.

2. A huge part of Web3’s promise is about empowering users to truly own their assets, whether that’s money, real estate, or digital goods. The Finternet will enable users to tokenize their assets and manage them seamlessly across different platforms. That’s one of the foundational promises of Web3, and the Finternet seems like it’s going to fully realize that vision.

3. What’s interesting is that the Finternet doesn’t try to be fully decentralized at all costs. It’s a hybrid model—decentralized where it makes sense, but it also incorporates centralized elements to ensure things like regulatory compliance and fraud prevention. This strikes a balance, allowing for innovation without the vulnerabilities that come with purely decentralized systems.

4. A key feature of the Finternet is its focus on interoperability and a modular architecture. The Unified Interledger Protocol (UILP) could do for finance what HTTP did for the internet, allowing different financial systems to communicate and transact across networks. It’s designed to support all kinds of financial assets and can easily evolve with technological advancements.

India is already well on its way to realizing a similar vision through its Digital Public Infrastructure (DPI). Systems like Aadhaar, UPI, ONDC, and DigiYatra are essentially a prototype of what the Finternet is aiming to do on a global scale.

• Aadhaar provides secure identity for over a billion people, forming the base layer for verification and transactions.

• UPI (Unified Payments Interface) has transformed digital payments in India, making it seamless for even the smallest merchants to accept payments. It’s very similar to what the Finternet envisions with interledger operations.

• ONDC (Open Network for Digital Commerce), powered by the Beckn Protocol, is another example of how a decentralized network can work in sectors like commerce, perfectly aligning with the Finternet’s goals.

India’s DPI has brought millions into the digital economy and scaled access to digital services in ways that were unimaginable a few years ago. UPI has been a game-changer for financial inclusion, and it’s clear that this infrastructure has laid the groundwork for something bigger—something like the Finternet.

The Beckn Protocol is another key piece in this puzzle. It’s an open, decentralized network that enables peer-to-peer interactions without intermediaries. What’s exciting is how big Namma Yatri has become—it's a decentralized ride-hailing service in India that runs on Beckn. For auto drivers, it’s been revolutionary because it cuts out the middleman. Drivers pay only a subscription fee to use the platform, and 100% of the fare goes directly to them. This means more control, more income, and less reliance on centralized platforms that charge high commissions.

Namma Yatri has gained massive traction because it allows drivers to operate on their own terms, and it’s a model that could be applied across countless industries. Imagine what this means for not just transportation, but commerce, logistics, energy, and more. Namma Yatri is just one use case—the Finternet could unlock a wave of decentralized, user-driven applications across a wide range of sectors.

What I love about this is how real-world these examples are. India’s DPI and protocols like Beckn show how these concepts are already being applied in practice, and how the Finternet could transform economies on a global scale.

This is where it gets interesting. The Finternet has the potential to be the onramp to Web3. By solving real-world problems in a user-friendly and compliant way, it could onboard millions of people who become familiar with decentralized concepts. Once people become familiar with how the Finternet works—transacting, managing assets, interacting with decentralized systems—they’ll naturally be more comfortable stepping into more advanced Web3 applications. In a way, the Finternet could be the stepping stone that Web3 needs to reach mainstream adoption.

I was brainstorming use cases of what the Finternet could actually enable apart from cross border payments, etc. I reflected back on DeFi, and now DeFI has unlocked some incredible possibilities, but for the average person, it’s still out of reach. The Finternet could change that by making DeFi accessible to a wider audience. One great example is microloans, which could be powered by a Reputation Protocol for credit scores.

Imagine aggregating data from Aadhaar, UPI, and even social and behavioral data to create a multi-layered credit score that reflects someone’s financial and social standing. This could transform access to credit, especially in rural areas where traditional credit systems don’t reach. A borrower might start with a small loan of ₹1,000, and as they repay, their credit score improves, allowing them to borrow larger amounts.

On the lender side, smart contracts could distribute funds across multiple microloans, providing a decentralized savings-like account that grows as borrowers repay with interest. The tokenization of savings adds another layer of flexibility, allowing users to collateralize part of their wallet balance without depleting it.

While Web3 has achieved so much, especially in creator empowerment and social protocols, there’s still a long way to go for mass adoption. The Finternet fills in the gaps, providing the necessary infrastructure to make these innovations accessible to everyone. It builds on the promises of Web3, bringing scalability, regulatory compliance, and real-world use cases to the forefront.

In the end, I see the Finternet and Web3 working side by side, with the Finternet helping Web3 reach its full potential by bringing decentralized technologies to a global audience. I am continuing to study this deeper and will share more thoughts soon.

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• https://finternetlab.io/images/mustRead/Finternet_technology_vision_and_architecture.pdf

• https://finternetlab.io/images/mustRead/Finternet_the_financial_system_for_the_future.pdf