DeFi
a.k.a. Decentralized finance
Financial services like lending, borrowing and trading run by smart contracts on a blockchain instead of by banks.
DeFi, short for decentralized finance, rebuilds familiar money tools, swapping, lending, borrowing, earning interest, out of smart contracts: programs on a blockchain that run exactly as written. You connect your own wallet and deal with the code directly. No account application, no branch, no closing time.
You can swap tokens on a decentralized exchange, deposit into a liquidity pool to earn fees, or chase rewards with yield farming. Because DeFi apps can plug into each other, people call them money legos.
The freedom cuts both ways. If the code has a bug, a hacker can drain it in minutes. If you sign the wrong thing, there's no fraud department. And sky-high yields usually mean sky-high risk.
Chasing the highest advertised yield without asking where that yield comes from. If you can't see the source, you may be the source.
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