web3/concepts/defi.md

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Decentralized Finance (DeFi)

Defi is a broad category of smart-contracts which loosely correspond to digital contracts running on a blockchain which allow users to create collateralized loans out of stablecoin and which have side payouts in so-called "governance tokens".

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 and to fund margin trading activities to speculaate on crypto assets.

See also yield-farming, amm, dex.