DeFi Is Helping to Fuel the Crypto Market Boom—and Its Recent Volatility

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Money is flooding into decentralized finance, or DeFi, another hot, and risky, corner of the cryptocurrency market

, but money is also flooding into another hot, and risky, corner of the cryptocurrency market: DeFi.offered on public blockchains

. Like traditional banks, DeFi applications allow users to borrow, lend, earn interest, and trade assets and derivatives, among other things. The collection of services is often used by people seeking to borrow against their crypto holdings to place even larger bets. There are two key differences from mainstream banks: All services are for digital currencies instead of government-issued ones such as the dollar and the euro, and there is no intermediary or centralized system through which transactions are processed.

Users typically access DeFi platforms through software known as dapps, or decentralized apps, most of which run on the Ethereum network. They connect their digital wallet to the app and select a service from a drop-down menu. Functions handled at a traditional bank by a loan officer or teller are automated.

“It’s essentially banking for the blockchain space,” said Antoni Trenchev, co-founder and managing partner of Nexo Capital Inc., one of the largest firms in the DeFi industry.

 

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How can you even drop dogecoin and defi in the same „article“. They have absolutely nothing in comparison. They even run on different chains, except the bridges.

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Forex is much more secure and profitable. It is a centralized

paulvigna No arguments here.... only a critic of the new and a defense of the status quo

There is nothing risky about DeFi, if you can't handle temporary -50% correction you don't deserve x10 that you'll get in next several months. Go trade index with 2% APR.😃

H

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new month, new cryptocurrency hype that is just another Ponzi scheme

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