web3/concepts/defi.md

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# Decentralized Finance (DeFi)
Defi is a broad category of [smart-contracts](smart-contracts.md) which loosely correspond to digital contracts running on a [blockchain](blockchain.md) which allow users to create collateralized loans out of [stablecoin](stablecoin.md) and which have side payouts in so-called "[governance tokens](governance-token.md)".
DeFi generally refers to a collection of services which offer lending products offered by non-banks and which exist outside the regulatory perimeter as a form [regulatory-arbitrage](regulatory-arbitrage.md) and to fund margin trading activities to [speculaate](speculation.md) on [crypto assets](cryptoasset.md).
See also [yield farming](yield-farming.md), [AMM](amm.md), [DEX](dex.md).
## References
* [@allen_defi_2022]
* [@carter_defi_2021]
* [@aramonte_defi_2021]
* [@saengchote_defi_2021]
* [@barbereau_defi_2022]