DeFi

DeFi, short for Decentralized Finance, refers to a blockchain-based financial system that operates without intermediaries such as banks, financial institutions, or other centralized authorities. DeFi aims to create an open and transparent financial system that is accessible to everyone and offers a range of financial services, including borrowing and lending, trading, insurance, and more, using decentralized applications (DApps) and smart contracts.

DeFi is built on a decentralized infrastructure, usually on the Ethereum blockchain, allowing anyone to participate in the network using a digital wallet and providing access to financial services in a permissionless, secure, and transparent manner. Decentralization ensures that there is no central authority that controls the network, and all transactions are recorded on a public ledger, making the system transparent and immutable.

Some popular DeFi applications include decentralized exchanges (DEXs) like Uniswap and SushiSwap, lending protocols like Aave and Compound, and stablecoins like Dai and USDC. As DeFi continues to gain popularity, it is challenging traditional financial institutions and opening up new opportunities for innovation and financial inclusion.