WHY DECENTRALIZED FINANCE(DeFi)?
Personal finance is an important subject. It doesn’t matter how much one earns, but how much he or she saves is the real question
However, in the last few years, investors are actively investing in cryptocurrencies that yield good returns. With a continuous rise in cryptocurrency investment, investors also want to explore the world of decentralized finance (DeFi).
WHAT IS DeFi
A simple answer to what is decentralized finance or DeFi is that it is a brand new monetary system which is built on public blockchains. The components of open finance consists of protocols, digital assets, dApps and smart contracts, which are built on Blockchain.
These financial services are provided without restrictions to everyone 24 hours a day due to the active development of blockchain technology in general, and in particular the Ethereum platform.
WHY DeFi
DeFi is allowing users to build tools to increase trust and decrease risk. Things like transparent loans, insurance contracts, pooled investments and more allow not just turning inefficient money into efficient money, but does so in a safe way.
“The goal of DeFi is to reconstruct the banking system for the whole world in this open, permissionless way,” says Alex Pack, managing partner at Dragonfly Capital, a $100 million crypto fund. “You only get that shot every 50 years.”
Key benefits of Defi.
Openness(permissionles):
The term ‘decentralized finance’ is already a clear indication of what the DeFi movement considers to be its defining feature. That’s hardly surprising. Decentralization is at the heart of blockchain’s value proposition. The aim is to move away from relying on corporations and other institutions for oversight, server space, data storage and so on. Blockchain networks achieve this by ensuring that one transaction history is shared among all of their members
Accessibility:Quick and permanent access
Immutability:bye bye to human errors
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.
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Source: https://www.livemint.com/brand-post/demystifying-decentralised-finance-defi-in-crypto-and-blockchain-11615549104336.html