DeFi: a new financial institution
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DeFi — what do these four letters mean and why do you see them so often near the word “cryptocurrency”? You will find the answer to this question in this post.
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Decentralized Finance (DeFi) is a decentralized ecosystem of services and applications developed on the basis of the blockchain, using cryptocurrency, tokens and smart contracts.
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What is the difference between DeFi and CeFi?
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In this case, the main difference between these two systems is the security of your funds.
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CeFi is a system of centralized finance. During trading, users send their funds to the exchange and can manage them in their internal accounts. But despite the fact that the assets are stored on the exchange, they are not protected from crypto attacks.
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In turn, DeFi is a more secure system, since the users have full control over their funds, and security directly depends on the technologies that they use.
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Advantages of DeFi:
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—  transparency;
—  easy to create applications due to open source code;
—  receiving funds without bank control;
—  minimum time required for processing payments;
—  the opportunity to earn on cryptocurrency;
—  minimal risks.
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DeFi has recently appeared, but already in this short time the system has managed to show excellent results.