DeFi

The simplest example of DeFi is peer-to-peer finance. Finance is based on owning assets, getting returns on these assets, borrowing and lending. All those four could be covered by DeFi products. The protocol used is programmable blockchains such as Ethereum. There are contractual aspects of finance. They will be catered to by the maths of crypto or blockchain. These are early days. Many assurances of central financial institutions are yet not available on DeFi. Of course, you get the ability to lend and borrow, with no paperwork as in the real world in a jiffy. In fiat currency, this takes a lot of time. Suppose a person has to borrow $1 billion for a few seconds. Let there be a million DeFi users, each contributing $1000 by parking their crypto assets into yield farms. It is a cool solution.

print

Leave a Reply

Your email address will not be published. Required fields are marked *