DeFi (Decentralized Finance)

Finance without banks: loans, swaps, savings, derivatives via smart contracts.

DeFi: complete financial system. DEX (Uniswap), Lending (Aave), Stables (DAI), Derivatives (dYdX, GMX, Hyperliquid), Liquid Staking (Lido), Aggregators (1inch). Smart contracts, no KYC, 24/7. TVL: $250B (2025), peak 250B 2021. Chains: ETH 60%, SOL 8%, BSC 5%, TRX 5%.

In plain words

An entire financial system without banks: loans (Aave), swaps (Uniswap), savings, derivatives, stablecoins. Runs on smart contracts, open 24/7, no KYC. Cheaper and faster than banks, but if the code has a bug, you lose money and there's no complaint office.

Example

Example: 1) Borrow 5000 USDC on Aave (1 ETH collateral), 4% interest, repay anytime. 2) Stake ETH on Lido = 3% APR + trade stETH. 3) Provide ETH/USDC liquidity on Uniswap V3 = 7% APR. All without bank account.

Also known as: DeFi, decentralized finance

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