Decentralized finance, or DeFi, refers to a field based on blockchain protocols and assets.DeFi is an ecosystem of decentralized applications (dApps) that provide a wide range of peer-to-peer financial services, from trading to lending. These apps differ from centralized services in that they operate almost entirely autonomously, without the need for any kind of financial intermediary. This is what ultimately enables decentralized finance to allow people to not only transact, but also execute a variety of financial services in a completely peer-to-peer manner.
DeFi stands for Decentralized Finance, a financial service and tool based on blockchain technology and smart contracts that aims to decentralize and open up financial services.DeFi is an ecosystem of decentralized applications (dApps) that provide a wide range of peer-to-peer financial services, from trading to lending. DeFi's core concept is to decentralize traditional financial services such as lending, trading, payments, and insurance through blockchain technology and smart contracts and provide financial services that are more open, transparent, and trust-free. These applications differ from centralized services in that they operate almost entirely autonomously and do not require any form of financial intermediary. This is what ultimately enables decentralized finance to allow people to not only transact, but also execute a wide range of financial services in a completely peer-to-peer manner.
Features of DeFi include:
1. decentralization: DeFi application is built on the blockchain and does not rely on traditional financial institutions; users can conduct transactions and participate in financial activities directly on the blockchain, thus realizing the decentralization of financial services.
2. Openness: DeFi application is open and can be accessed and used by anyone without the thresholds and restrictions in the traditional financial system.
3. Transparency: The characteristics of blockchain technology make the transactions and data of DeFi application open and transparent, which can be viewed and verified by anyone.
4. Trustless: DeFi apps automate financial services through smart contracts, eliminating the need to trust third parties and allowing users to rely solely on code and the blockchain network to execute transactions and contracts.
