DeFi (Decentralized Finance)
Definition
DeFi refers to financial services built on blockchain technology that operate without traditional intermediaries like banks. DeFi protocols enable lending, borrowing, trading, and yield farming through smart contracts. Popular DeFi platforms include Aave, Uniswap, and Compound. Total Value Locked (TVL) is a key metric measuring the amount of assets deposited in DeFi protocols. DeFi aims to create an open, permissionless financial system accessible to anyone.
Why Does This Matter?
Understanding DeFi (Decentralized Finance) is essential for anyone investing in cryptocurrencies or working with blockchain technology. This concept directly influences how projects are valued, how markets behave, and what risks and opportunities exist for investors.
How Does CryptoValue Use This?
At CryptoValue, fundamental concepts like DeFi (Decentralized Finance) feed into our proprietary Value Score — a rating from 0 to 100 based on 10 on-chain and market metrics. Our goal is to help you identify undervalued and overvalued coins, rather than just looking at price.
Related Terms
A smart contract is a self-executing program stored on a blockchain that automat...
Total Value Locked (TVL) measures the total amount of cryptocurrency deposited i...
Yield farming is the practice of moving cryptocurrency between DeFi protocols to...
A liquidity pool is a collection of cryptocurrency locked in a smart contract th...