From the course: Building Web3 Decentralized Apps in Ethereum
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Decentralized finance (DeFi)
From the course: Building Web3 Decentralized Apps in Ethereum
Decentralized finance (DeFi)
- [Instructor] DeFi is short for decentralized finance. At its most basic DeFi is the processing of financial transactions on the blockchain. This can remove the need for a central resource or organization to handle the processing. The general concept behind DeFi is that the current financial system sometimes called CeFi or centralized finance, forces us to rely on banks, insurance companies, escrow companies, brokers and central exchanges to invest borrow loan and make transactions. Ultimately, these institutions make considerable money, but provide little by way of service. The de-central and transactional nature of the blockchain opens up the opportunity to completely eliminate these institutions, and in turn, empower the participants to earn and save money. By empowering people for example, to make peer-to-peer loans, the interest historically earned by banks can now be earned directly by individuals,…
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