The Steemit Crypto Academy Week 7: Introduction to Defi and Yield Farming

After reading the content released by cryptocurrency professor @gbenga with the theme Introduction to Defi and Yield Farming, I took the initiative to become part of this ecosystem so that I could contribute to writing on Decentralized Financial Ecosystems and Projects / Protocols in Ecosystems. I think this theme is interesting to discuss and I will try to do it according to the understanding I get.

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Introduction

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There is no stopping for learning to learn new things in this world, especially about cryptocurrencies that need to be continuously studied and understood, and one of the places in learning Crypto can be done by becoming part of the Crypto Academy. I contributed writing about stable coin (tether) a few days ago, and am now back here to share information about DeFi and Yield Farming.

Previously I had read some local media articles about the DeFi system, but only general and non-specific discussions as written by @gbenga.

DeFi stands for decentralization finance, which is a monetary system built on blockchain technology, the system adopted also has openness, so that with this system users can get financial services quickly without having to follow the long financial bureaucratic process that has happened so far. Users can easily perform financial transactions peer to peer

So far, users of traditional financial services have often complained about the limitations of financial transactions carried out, but through the Blockchain system everyone from various parts of the world can carry out unlimited financial transactions.

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History DeFi

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DeFi is now not a new thing in the world, various traditional financial sectors and blockchain actors in general, the simplicity without involving intermediaries adopted by DeFi makes it widely used as a transaction medium nowadays, but not everyone understands this because the process can be done by using the internet network, so only certain groups of developing countries are adopting this system after switching from traditional finance.

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Decentralized Finance (Defi) vs Centralized Finance (Cefi)

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There are significant differences between DeFi and CeFi, the difference generally lies in the systems adopted by both.
For new users who are familiar with the crypto world, they have not been able to adopt this system to be used as a financial service in conducting financial transactions, they think that the system they are running cannot be trusted, they store financial assets but do not have guarantees for the transactions carried out, but the CeFi system provide guarantees for every transaction made, both savings funds, insurance, deposits, loans and other transactions. All guaranteed by the state.

However, for users who already understand the cryptocurrency system with the various conveniences it offers, they prefer to use this system in their financial services. I personally keep assets in the form of stable coins and traditional financial services are only used to receive salaries from where I work.

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DeFi Ecosystem

With this new system the public can openly make final transactions on the blockchain network with a peer to peer system, there is no interference from other parties in transactions, this system known as dApps provides greater financial control to its users,

DeFi has various types of applications so that the role of users is very important in choosing the type of dApps to use for the security of their assets. This is important because the Open Source system that is built has the power of individuals or groups.

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Yeild farming and Defi

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Since the Yeild farming and Defi ecosystem got its momentum, there has been a lot of creativity and innovation in the cryptocurrency world, so it has a lot of crypto obtained from agricultural products. Many profits are obtained by investors from farming.

To invest here you can use a platform in a different ecosystem, as in the @gbenga post it states that:

These projects include;
DAO, Compound, AAVE, Balancer, Uniswap, Curve, Synthetix (SNX) maker and many more.link

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Conclusion

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The financial system used by DeFi provides a lot of convenience to users so that they can trim blocks that are formed like the Traditional Financial system. To get profits, investors must have a sufficient basis when choosing investment projects, so as not to cause losses due to fraud committed.

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