At a time when the world still relies on traditional banks to manage money, a new sector in the world of cryptocurrencies has emerged called decentralized finance (DeFi). This sector aims to provide the same financial services (lending, borrowing, trading, investing) but without an intermediary or bank, and in an open and transparent way for everyone.
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💡 What is decentralized finance?
Decentralized finance is a financial system built on blockchain technology that enables users to interact directly with each other.
In other words:
You do not need a bank to approve the loan.
You do not need an intermediary to trade.
You can fully manage your money yourself.
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🔑 The most prominent projects in this sector
1️⃣ Aave (AAVE)
A popular lending and borrowing protocol.
Allows you to deposit your coins to earn interest, or borrow coins against collateral.
All of this is done automatically through smart contracts.
2️⃣ Compound (COMP)
A similar platform operating on the Ethereum network.
Allows users to earn returns on their deposits or borrow without the need for a bank.
Characterized by ease of use and wide adoption.
3️⃣ Uniswap (UNI)
The most famous decentralized exchange (DEX).
Allows direct exchange of cryptocurrencies between users.
Based on what are called liquidity pools instead of traditional exchanges.
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🚀 Why is this sector important?
Provides financial freedom that banks do not offer.
Reduces costs and fees.
Open to everyone without geographical or banking restrictions.
Represents a significant step towards a fully decentralized global economy.
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📝 Conclusion
Decentralized finance (DeFi) is not just an idea, but a true financial revolution aimed at giving individuals complete control over their money.
In the next article in this series, we will explore another exciting world: non-fungible tokens (NFTs) and how they have turned art and gaming into valuable digital assets. 🎨✨
