What does DeFi mean?

DeFi is short for decentralized finance that includes digital assets, protocols, smart contracts, and dApps built on blockchain.

We can think of DeFi as an open financial system where various small financial tools and services can be built.

Decentralized finance is a movement where decentralized server networks and blockchains are used to transform traditional financial products into transparent protocols that work without intermediaries.

Currently, almost all decentralized finance applications are based on Ethereum and Binance Smart Chain blockchains.

Like Bitcoin, Ethereum and Binance you have a blockchain that acts as a shared ledger that tracks digital value. Rather than a central authority, all users who have access to and participate in the blockchain are the ones who control the transactions of both Ethereum and Binance depending on which one it is as if it were a democracy.

Developers can program applications that can create, store and manage digital assets, also known as tokens, on the blockchain. For this, dApps (decentralized applications) are described and built.

The expiration of contracts and agreements is automatically enforced if the blockchain obtains the correct data. Complex and irreversible agreements can be made without the need for an intermediary.

Anyone can create, adapt, mix, match, link or build upon an existing decentralized finance product without permission.

Decentralized finance protocols are modular, so they can be stacked on top of each other to build an increasingly dense and complex system of interacting parts.