Decentralized Finance (DeFi)
By CoinGecko | Updated on Mar 03, 2020
Decentralized Finance (DeFi) refers to the movement of building decentralized financial applications that have no central authority and is censorship free.
DeFi applications cover many use cases and a few popular ones are stablecoins, lending/borrowing and trading (decentralized excanges). By removing the middleman in systems, DeFi applications are able to achieve a better rate of returns for its users, while lowering barrier of entry as the application does not discriminate or censor any particular party from joining.
Related Terms
Ponzi Scheme
A Ponzi scheme is also referred to as pyramid scheme, and typically takes the form of an investment scheme which pays existing investors with funds collected from new investors.
Ledger
A record of financial transactions that cannot be changed, only appended with new transactions.
Dusting Attack
A new form of malicious activity in which hackers and scammers attempt to undermine the privacy of cryptocurrency users by sending little amounts of money to their wallets.
Mnemonic Phrase
A mnemonic phrase (also known as mnemonic seed, or seed phrase) is a list of words used in sequence to access or restore your cryptocurrency assets.
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