Decentralized Finance (DeFi)
By CoinGecko | Updated on Mar 03, 2020
Decentralized Finance (DeFi) refers to the movement of building decentralized financial applications that have no central authority and is censorship free.
DeFi applications cover many use cases and a few popular ones are stablecoins, lending/borrowing and trading (decentralized excanges). By removing the middleman in systems, DeFi applications are able to achieve a better rate of returns for its users, while lowering barrier of entry as the application does not discriminate or censor any particular party from joining.
Related Terms
Collateralized Debt Obligation (CDO)
A collateralized debt obligation (CDO) is a form of derivative in which the value is generated from another underlying asset, and is sold to institutional investors.
Validator
A block-signing participant of a Proof of Stake blockchain network, whom have significant tokens staked on the network.
Arbitrage
A strategy where investors buy a currency in a market and sell it at a higher price in another market to gain profit.
Turing-Complete
A "turing complete" code or blockchain refers to the ability to read program-written codes.
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