DeFi
Decentralized financial ecosystem built on blockchain.
Beginner-friendly explanation
DeFi (decentralized finance) is a set of applications allowing traditional banking operations (loans, savings, trading) without using a bank. Everything runs on blockchain.
Example: Depositing crypto on a platform to earn interest is a DeFi operation.
Intermediate-level insight
DeFi uses smart contracts to automate financial services: liquidity pools, collateralized loans, algorithmic stablecoins, etc. It relies on interoperability between various blockchain protocols.
Example: Using Aave to borrow USDC against an ETH deposit is a DeFi action.
Advanced perspective
DeFi restructures classical financial paradigms by replacing institutional trust with programmable cryptographic guarantees. It introduces complex dynamics: yield farming, governance tokens, impermanent loss, systemic risks related to smart contracts.
Example: An investor optimizes their DeFi yield by depositing funds into a cross-chain protocol with automated farming and impermanent loss protection.
NFT DEFI Web3
DeFi, decentralized finance, smart contract, crypto lending, liquidity pool, yield farming, staking, stablecoin, governance