What it means
Decentralised finance: lending, borrowing and exchanging that runs on public smart contracts instead of through a bank.
Anyone can use a DeFi protocol, and its rules and balances are visible on the blockchain. There's no branch, no opening hours and no one to approve you.
How it works
That openness comes with risks of its own, such as bugs in the code and sudden market moves. Our Risk Disclosure explains them.
Related terms
| Term | What it means |
|---|---|
| Smart contract | A program that lives on a blockchain and runs exactly as written, holding and moving tokens by its own rules. |
| Lending market | An onchain pool where people supply money that others borrow, with the interest paid by borrowers going to those who supplied it. |
| TVL | Total value locked: how much money is deposited in a protocol or pool right now. |
This glossary explains terms in general. It isn't investment, tax or legal advice.