Decentralized Finance (DeFi) Explained! The COMPLETE Guide For Defi Crypto 2022!
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What Is Decentralized Finance (DeFi)?
Today, cryptocurrencies have blossomed into a trillion-dollar sector, causing a wave of global financial disruption. At the core of cryptocurrencies lies a fascinating history of invention. A succession of events have changed the crypto world, with the most notable being, Bitcoin the first cryptocurrency.
Despite its meteoric rise over the last 12 years, the finance sector have been reluctant to adopt Bitcoin, owing mostly to the currency's fundamental lack of stability. Because of its substantial price volatility, mainstream banks will not accept a Bitcoin loan – this makes Bitcoin an unsuitable asset for planning any investment account.
The cryptocurrency ecosystem has been witnessing some changes and decentralized finance is among the most recent. It has brought about some exciting projects; however, many users are still unaware of what DeFi really is and that is why I created this video. So, let’s get into it!
What is Decentralized Finance?
Have you ever imagined what the world would like without traditional banks? The answers lie in DeFi.
Decentralized finance is a new community of financial protocols and applications driven by blockchain technology with programmable features. The transactions are carried out automatically via smart contracts on the blockchain.
As a result, instead of passing through intermediaries like banks or brokerages, they are available to everybody. Unlike traditional financial institutions, one does not need proof of address, Social Security number, or a government-issued ID to use DeFi applications.
DeFi is a system in which algorithms on blockchains allows every participant in the finance industry to interact with each other or with a software rather than an institution or company to facilitate a transaction.
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DISCLAIMER: This is not financial advice! This is an entertainment and opinion-based show. I am not a financial adviser. Please only invest what you can afford to lose, and we encourage you to do your own research before investing. DYOR