CHAMS FINTECH KNOWLEDGE SERIES
In this issue, we continue to see crucial technology solutions that empower financial institutions and businesses to provide seamless solutions.
Decentralized Finance, also known as DeFi, refers to a financial system built on blockchain technology that aims to provide open and permissionless access to a variety of financial services and applications.
DeFi is an umbrella term for peer-to-peer financial services on public blockchains, primarily Ethereum. DeFi offers an alternative to traditional financial systems by utilizing blockchain technology.
Furthermore, DeFi eliminates the need for intermediaries, such as banks or financial institutions, by using smart contracts and decentralized protocols. With DeFi, you can do most of the things that banks support.
It enables users to access financial services, such as loans and investments, buy insurance, trade derivatives faster, without intermediaries and paperwork, fostering financial inclusivity and transparency.
DeFi relies on blockchain platforms like Ethereum or Binance Smart Chain which enable the creation of smart contracts.
Smart contracts are the building blocks of DeFi applications.
They are programmable and enforceable contracts that facilitate the exchange of assets or provide financial services. Smart contracts eliminate the need for intermediaries, ensuring trust and transparency.
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