Financial services, lending, trading, saving, built on blockchain instead of banks.
Decentralized Finance, or DeFi, refers to financial services, lending money, trading assets, earning interest, built directly on blockchain technology and run by automated code rather than a traditional bank or broker. Supporters argue it cuts out costly middlemen and opens financial services to anyone with an internet connection; critics point to a track record of hacks, scams, and extreme volatility that traditional, regulated finance is built specifically to guard against. It remains a small, still-maturing corner of the financial system rather than a mainstream alternative to banking, at least for now.
Part of the Open Bell Glossary — plain-English explanations of the terms that come up on the show. Browse every term.