What is DeFi (decentralised finance)?
Financial services run by smart contracts on a blockchain, without a bank in the middle.
DeFi replaces intermediaries with contracts: lending pools, exchanges, derivatives and stablecoins that anyone with a wallet can use. Access is permissionless; the code is the counterparty.
That also means the code's bugs are your risk. Protocol failures and exploits have cost billions, and deposits are generally not insured.
Related terms
The chance that a contract's code or admin keys take your funds, regardless of price.
The value of assets deposited in a protocol's contracts; its main usage measure.
- Liquidity poolDeFi
Tokens locked in a contract that traders swap against, earning the pool's fee share.