Heard about cryptocurrencies, NFTs, Bitcoin, De-Fi, Ethereum, Blockchain, etc. Everyone is talking about it, and all these topics are in the hype. But what does it mean? What makes them so demanding and popular? Why is everyone talking about them?
This answer explained in this blog is in lay-mans terms. So, stay tuned till the end. De-Fi (Decentralised Finance) is an open and global financial system built for the internet age — an alternative to a system that is opaque, tightly controlled, and held together by decades-old infrastructure and processes.
A centralized system is a network of computers that depend on the main computer or server. All the data is stored and controlled by this server. In Decentralized-finance, the markets are always open, and there are no central authorities who can block payments or deny you access to anything.
In a centralized system, Services were previously slow and at risk of human error, but now with De-Fi everything is automated and safe. Because It is written in code that anyone can inspect and scrutinize.
De-Fi gives you control and visibility over your money. It gives you access to global markets and alternatives to your local currency or banking options. Defi products open financial services to anyone with an internet connection and are owned and maintained by their users.
So far, tens of billions of dollars worth of crypto have flowed through Defi applications, and it is bound to grow every day. There is a booming Economy in Crypto, where you can borrow, lend, earn interest, long/short, and many more. Crypto-savvy Argentinians have used Defi to escape crippling inflation. Companies have started streaming their workforce wages in real-time.
Bitcoin is called the first cryptocurrency and also the first decentralized digital currency. Even now, It is the largest of its kind in terms of total market value.
Besides being obtained by mining, It will exchange for other currencies, products, and services. Users can send and receive bitcoins for an optional transaction fee as well.
Bitcoin, In many ways, was the first Defi application. It lets you own and control value and send it anywhere, across the globe. It does this by providing a way for people who do not trust each other to agree on a ledger of accounts without trusted intermediaries.
Bitcoin is open to anyone, and no one has the authority to change its rules. The transactions will be verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain.
It is not like traditional finance, where the government can print money that will devalue your savings, and companies can shut down markets.
A decentralized application (dapp) is an application built on a decentralized network that combines a frontend user interface and a smart contract. On Ethereum, smart contracts are transparent and accessible — like open APIs — so your dapp can even include a smart contract that someone else has written.
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