What is DeFi (Decentralized Finance)?

DeFi, or Decentralized Finance, refers to a system of financial services that operates on decentralized blockchain networks, primarily Ethereum, without relying on traditional financial institutions like banks or insurance companies. DeFi platforms offer services such as lending, borrowing, trading, and earning interest on cryptocurrencies through decentralized protocols. By using smart contracts, DeFi allows users to retain control over their assets while interacting directly with others in the financial ecosystem. DeFi aims to make financial services more inclusive, transparent, and accessible, but it also introduces risks, including smart contract vulnerabilities and regulatory uncertainties.