Finance needs both speed and brakes.

Small annoyances can sometimes save lives.

Think about the constant seatbelt reminder in your car. This incessant beeping is annoying, and many people have complained about it. But it's precisely this constant reminder that prompts countless people to buckle their seatbelts. And the result? According to the Insurance Institute for Highway Safety (IIHS), these constant reminders save approximately 1,500 lives each year in the United States alone. It truly is a lifesaver.

Small annoyances can sometimes save you a lot of money.

A frustrating phenomenon in modern banking is being suddenly interrupted when you think you've completed a wire transfer. You've entered the account number, routing number, and recipient's name. At this point, the bank doesn't immediately complete the transfer but pauses to confirm that the recipient's name matches the account information. This extra step disrupts the flow.

In the words of the product team, it's like friction. However, this pause has become one of the most effective ways to ensure payment security globally. The "Confirmation of Payee" service, provided by Pay.UK, enables individuals and institutions in the UK to make transfers and currently covers over 99% of transactions across various payment channels. The service's verification volume has grown from 14,000 transactions per month in June 2020 to over 70 million transactions per month in July 2025. It has reduced "account error" transactions by 59% and reduced financial losses for end users by 20% to 40%. This is crucial at a time when the financial industry has been striving for seamless transactions for over a decade. We've seen efforts like "one tap," "one swipe," and "click to transact," attempting to make funds flow silently in the background. The financial industry's instinct is often to view every pause as a flaw. As the financial industry has evolved, it has become increasingly obsessed with seamless integration. However, this evolution has repeatedly reminded us that certain so-called "friction" is actually a necessary brake to prevent systemic collapse. The Need for Brakes in Traditional Finance Today, the financial industry has embedded these restrictions into every new infrastructure it builds. In the United States, brokers with market access qualifications must implement risk control measures to limit their financial risk exposure and ensure regulatory compliance. When the U.S. Securities and Exchange Commission (SEC) passed Rule 15c3-5, it stated that the rule was designed to address the risks posed by automated, high-speed trading and to prevent unrestricted access to exchanges. The financial world repeatedly revisits this lesson for a simple reason: once the brakes fail, the damage often exceeds what institutions can withstand and recover from. In 1987, on Black Monday, the Dow Jones Industrial Average plummeted 22% in a single day. The Brady Committee recommended adding a pause button to the "circuit breaker" mechanism, stipulating that trading would be suspended for 15 minutes when the market fell by a certain percentage. Without these restrictions, Black Monday would have wiped out $1.7 trillion in global market capitalization in a single day. Adjusted for inflation, this loss is equivalent to more than $4.7 trillion today, exceeding the current GDP of Germany, the world's third-largest economy. These brakes taught the financial world that sometimes the only way to maintain speed is to briefly stop the machine. In other cases, a brief pause can solve the problem. In August 2012, Knight Capital Group suffered a software glitch, causing its computers to buy and sell millions of shares in just 45 minutes. This glitch caused a loss of $440 million in less than an hour, bringing the market maker to the brink of bankruptcy. Knight Capital Group optimized its system in pursuit of speed, which is crucial in market trading. However, an uncontrolled system without brakes, even the fastest one, will crumble instantly. The lesson is: the faster the system goes, the more important the braking mechanism becomes. The retail financial industry itself also faces numerous problems. For years, brokers have strived to make high-risk products easy to operate in order to drive retail user growth. They persisted, but ultimately lost trust. In its 2021 disciplinary action against Robinhood, FINRA noted that the company failed to conduct due diligence before approving clients for options trading and relied heavily on unregulated automated "approval bots." The investor protection nonprofit self-regulatory organization claimed that Robinhood's system approved clients based on inconsistent or illogical information. FINRA stated that the company's system allowed applicants with clearly questionable risk profiles to be approved. Robinhood's system is optimized to process applications quickly, avoiding waiting for potential customers. However, it lacks a meaningful pause between curiosity and security. It's fast, but without brakes. A Peculiar Case in Cryptocurrency The recent Aave-CoW incident in the cryptocurrency world has raised the need for braking mechanisms in the financial sector to a whole new level. On March 12, 2025, a user executed a $50 million exchange transaction through CoW Swap (a decentralized exchange (DEX) aggregator designed to protect users from bot front-running). The transaction was integrated into the front end of the DeFi protocol Aave. Due to insufficient liquidity, the user ultimately received only $36,930 worth of tokens, while paying out $50 million.

While Aave explained in its post-incident analysis that the user ignored explicit warnings about the impact of high prices, its founder and CEO, Stani Kulechov, posted on X that the Aave team "will look into how to improve these safeguards."