DeFi
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DeFi 101
Decentralized Finance ("DeFi", "Open Finance") refers to a number of decentralized protocols building open financial infrastructure. These protocols are valuable because they're creating the necessary plumbing to enable anyone in the world with an internet connection to access self-sovereign, censorship-resistant financial services.
In the existing system, all financial services are controlled by a central party. Whether it's basic money transfers, asset purchases, or lending, you must go through an intermediary who charges rent for mediating financial transactions. Decentralized financial services, on the other hand, connect individuals peer-to-peer and allow them to access basic financing more easily and affordably.
Properties of DeFi
Blockchain-based financial services are superior to their centralized counterparts across the following primary features:
Permissionless: An internet connection is all you need to access these services
Censorship Resistance: No central party is able to reverse the order of transactions and turn off the service
Trustless: Users don't have to trust a central party to ensure that transactions are valid
Transparent: Public blockchains are completely transparent and auditable
Programmable: Developers can create and intertwine financial services at a very low cost
Efficiency: Open financial services are powered by code, not humans, and as such entail much lower middleman costs, if at all
DeFi knowledge repository
Learning Defi
Defi security tips
Before interacting with any Defi protocol, make sure you understand what cryptocurrencies and crypto-wallets are.
NEVER share your seed phrase (private keys) with anyone. Customer service does NOT exist in Defi. Anyone spontaneously reaching out to you is by 99,9% a scammer.
When making the very first Defi operations, use tiny amounts.
Interact with trusted and audited protocols ONLY (check Defi services).
When interacting with a Defi protocol, make sure you are on the right web page or bookmark the valid links.
Do NOT sign transactions you did not want to make in the first place. Your wallet can be compromised.
Signing transactions via a hardware wallet is recommended.
Defi requires decent risk management skills. Allocate your funds responsibly.
Also in Defi the famous principle of finance applies: "High rewards come along with high risks."
If you have any doubts, reach out to us in the UFS Defi Whatsapp group.
Defi services
Curve - stablecoin specialized decentralized exchange
Uniswap - decentralized crypto exchange
Sushiswap - decentralized crypto exchange
Aave - crypto lending protocol
Compound - crypto lending protocol
Synthetix - derivatives protocol
dydx - derivatives protocol
GMX - derivatives protocol
Convex - Curve's yield optimiser
1inch - Defi aggregator
Synapse protocol - bridge
Opensea - NFT marketplace
Mirror - web 3 publishing
Lens protocol - web 3 social platforms
White papers
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