Mastering DeFi: A Beginner’s Guide to Decentralized Finance

Decentralized Finance (DeFi) is a revolutionary movement built on blockchain technology that aims to create an open, permissionless, and transparent financial service ecosystem. Unlike traditional finance, DeFi is not controlled by a single, centralized entity.

What is a DEX?

A Decentralized Exchange (DEX) is a peer-to-peer marketplace where cryptocurrency traders make transactions directly with one another. DEXs are a cornerstone of DeFi, offering users more control over their funds and greater resistance to censorship.

Lending and Borrowing

DeFi lending platforms allow users to lend their crypto and earn interest, or borrow assets against their holdings. These platforms use smart contracts to automate the process, removing the need for traditional financial intermediaries.

By understanding these core components, you can begin your journey into the exciting and rapidly evolving world of Decentralized Finance.