STEEM CRYPTO ACADEMY WEEK 7 HOMEWORK POST FOR @gbenga ; BY @akashhassan

akashhassan (59)in SteemitCryptoAcademy • 3 years ago (edited)

Hi my friends I hope that you are doing well and you are motivated I am doing homework for steam Crypto Academy I did a little bit of research on this topic I will try to explain this in my own words as much is I know so let's begin

source

DEFI decentralized Finance

These days everyone is talking about decentralized finance but what is decentralized finance let me explain i decentralized means that there will be no third party involved third Party can be Government and any other person but because in decentralized finance the use smart contract

Understand it with example ok if we need loan where well we go we go to the bank If you want to keep on money and won't interest on that we go to the bank if we need a credit card you go to the bank now

You can do all these things in defi ecosystem there are many projects built on ethereum blockchain they are providing all the services using smart contracts

most of the projects in in the DEFI are built on ethereum blockchain but this is just the beginning in future the ecosystem will expand itself and there are many projects upcoming on other blockchain such as TRON

How does it work

DEFI Give you the opportunity To lend your cryptocurrencies and get a significant amount of interest on that just like we do it in centralised form in bank But in this case everything is handled by a smart contract you can verify the smart contract iswhatever is coded in it you can see everything You can even take loan the process is the same you will have to keep something in collateral And you will have to pay a significant amount of interest on your loan just like we do it in regular banks

There are many projects on DEFI

Compound

Bxz

Uniswap

Nexo

Maker

Curve

these are some of the popular projects in DEI ecosystem

Maker

Let's talk about what maker release it is a open source project Which is built on ethereum blockchain Main purpose of this project is that it stabilize the token dai The value of dai And it support smart contract Main purpose of this is to to keep the value of dai of close to to US dollar as possible so that stable coin doesn't lose its value we can use maker on the maker platform for Transaction fee and payment

Maker works on autonomous basis It helps Incentivise actors For exchange And it also helps to stabilize the valune of dai

How does it works

If someone need loan they can go to the maker the platform and take loan bye by keeping ethereum ias a mortgage in the maker system you will have to pay a certain amount of interest on top of that and you will get dai coin which is is a stable coin pagged with US dollar you it can take back your ethereum anytime by returning your loan and the interest

You can you make some profit on your ethereum and you can do the same script but in this case you are the provided of ethereum and you are not here for loan so you will get a certain amount of interest on your ethereum It works the same as I explained in the beginning of DEFI

Special mentions to @steemcurator01
@steemcurator02 To get their support

#gbenga-week7 #cryptoacademy #steemitcryptoacademy #blockchain #security

3 years ago in SteemitCryptoAcademy by akashhassan (59)

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gbenga (73) 3 years ago

Thanks for being a part of my class and for participating in this week's assignment. I hope you learned from the class as the aim of the school is to teach and allow people to learn alongside.