The Role of AI in Shaping Decentralized Financial Products: Implications for Global Economic Inequality

Abstract

This study examines the transformative potential of Artificial Intelligence (AI) and Decentralized Finance (DeFi) in reshaping global financial systems and reducing economic inequality. The purpose of the study is to explore how AI-driven DeFi can improve financial inclusion by expanding access to secure, transparent, and decentralized financial services for underserved populations while addressing challenges such as algorithmic bias, technological inequality, and regulatory uncertainty. Using a qualitative methodology, the study reviews existing literature, analyzes emerging trends, and examines selected applications of AI and DeFi technologies. The analysis focuses on how AI enhances DeFi through automation, predictive analytics, personalized services, fraud detection, and transaction cost optimization. The findings show that AI-powered DeFi systems can promote economic empowerment, particularly in emerging economies, by lowering financial barriers and increasing access to financial services. However, inadequate infrastructure, limited digital literacy, and biased algorithms may deepen existing inequalities if left unaddressed. The study concludes that inclusive policy frameworks, investment in digital literacy, stronger blockchain infrastructure, and measures to reduce algorithmic bias are necessary to ensure equitable access to AI-DeFi innovations. Future research should empirically evaluate AI-DeFi applications across different socioeconomic contexts to determine their effectiveness in building inclusive and resilient financial systems.