Disentralized finans (Defi)

Defi na open and global finanshia system wey dem build for di intanet age - na altanative to one system wey nor klear to pipol, and don hold togeda for plenti years by old infrastrushure and proseses. E dey give yu kontrol and visibility ova yor money. Im dey give eksposhure to global markets and altanatives to yor lokal kurensy abi banking opshons. Defi product don open finanshia savis up to anyone wit one intanet koneshon and na dem users own and dey maintain am. As e dey crypto wey worth plenti billions of dollar don flow thru DeFi aplikashons and im dey grow efri day.

Wetin bi DeFI?

DeFi na kolective words for finanshia products and savis wey dey assessibol to anyone wey fit yus Ethereum - anyone wit one intanet koneshon. Wit DeFi, di market dey always open and nor sentralized authority fit block any payments abi deny yu to yus anytin. Savis wey dey slow bifor and at risk of human mistak don dey safe nau dat dem don handol dem by kode wey anyone fit inspet and skrutinize.

One crypto ekonomy dey wey dey do well out there, wia yu fit lend, borow, long/short, earn intrest, and more. Argentina pipol wey sabi crypto wella don yus DeFi to eskape inflashon wey dey kripol. Kompanis don start to dey stream dem employees dem monies in real taim. Some folks don even komot and pay off loans wey worth millions of dollars witout di nid for any pesina identifikashon.

DeFi vs tradishonal finans

One of di ogbonge ways to see di potenshia of DeFi na to ondastand di palava wey hapun today.

Some pipol nor dey give assess to set up one bank akant abi yus finanshia savis.
Lack of assess to finanshia savis fit privent pipol to get work.
Finanshia savis fit block yu to get pay.
One sharge of finanshia savis wey nor dey show for yor pesina data.
Gofament and sentralized institushons fit klose down market at anytaim.
Trading hawas get limit to biznes hawas pf spesifik taim zone somtaims.
Money transfa fit take days due to internal human process.
One ogbonge finanshia savis dey bikos middol institushons nid dem kut.

One kain komparison

DeFi	Tradishonal finans
Yu dey hold yor money.	Kompanis dey hold yor monie.
Yu dey kontrol wia yor monie dey go and hau dem dey spend am.	Yu nid to trust kompanis sey dem nor go do yor monie anyhau, laik lending to borrowas wey get risk.
Transfas of funds hapun in minutes.	Payments fit take days due to manual process.
Transakshon aktivity dey pseudonymous.	Dem don join finanshia aktivity wit yor identity.
DeFi dey open to anyone.	Yu suppose apply to yus finanshia savis.
Di markets dey always open.	Markets dey klose bikos dem workas nid brakes.
Dem built am on transparensy - anyone fit look one product data and sheck hau di system dey work.	Finanshia institushons na klose books: yu fit ask to see dem loan tory, one rekod of di assets wey dem manaj, and so on.

Make yu eksplore Defi apps

E start wit Bitcoin...

Bitcoin na di first Defi aplikashon. Bitcoin dey rily let yu own and kontrol value and send am anywia around di world. Im dey do dis by providin one way for one large numba of pipol, wey nor dey trust ish oda, to gree on one ledger of akants witout di nid for one middol pipol dem trust. Bitcoin dey open to anyone and nor one get pawa to shanj im rules. Dem don write Bitcoin rules, laik im skarcity and im openness, into di teknologi. Nor bi laik tradishonal finans wia gofament fit print monie wey dey devalue yor savings and kompanis fit shut down markets.

Ethereum dey build on dis. Laik Bitcoin, di rules nor fit shanj on yu and efrione get assess. But e dey allow make digital money dey programabol, as dem dey yus so yu fit go biyond storing and sending value.

Monie wey yu fit program

E dey sound odd... "why i go wan program mai monie"? As e dey, dis pass just one default feature of tokens on Ethereum. Anyone fit program logik into payments. So yu fit get di kontrol and sekurity of Bitcoin wey dem mix wit di savis dem provide by finanshia institushons. Dis dey allow yu do tins wit cryptocurrencies wey yu nor fit do wit Bitcoin laik to dey lend and borrow, dey prosess payments, dey invest in index funds and more.

Make yu eksplore awa suggeshons for DeFi aplikashons to try out if yu dey new to Ethereum.

Make yu eksplore Defi apps

Wetin yu fit do wit DeFi?

One disentralized opshon dey to most finanshia savis. But ethereum dey also kreate oportunitis for finanshia products wey dey new. Dis na list wey dey grow efriday.

Send monie around di globe
Stream monie around di globe
Access stabol kurensis
Borrow funds wit kolateral
Borrow witout kollateral
Start crypto savings
Trade tokens
Grow yor portfolio
Fund yor ideas
Buy insurans
Manaj yor portfolio

Send money around di globe kwik

As one blockchain, dem don disign Ethereum to dey send trasakshon wey dey sekure in a global way. Laik Bitcoin, Ethereum dey make yu send monie around di world as izy as to dey send one email. Make yu just enta (laik bob.eth) of pesin yu wan send monie to abi dem akant address from yor wallet and yor payment go go direct to dem in minutes. To send abi risiv payments, yu go nid wallet.

See payment dapps

Stream money around di globe...

Yu fit stream monie ova Ethereum. Dis dey allow yu pay somone dem salary by di sekond, dey give dem assess to dem monie weneva dem nid am. Abi rent somtin by di sekond laik one storaj locka abi electik skoota.

And if yu nor wan send abi stream bikos of hau much di value fit shanj, anoda kurensis dey for Ethereum: .

Access stabol kurensis

Cryptocurrency volatility na palava for plenti finanshia product and generally. Di DeFi komunity don solve dis wit stabolcoins. Dem value dey stay peg on one anoda asset, ushualy one popular kurensy like dollars.

Coins laik Dai abi USDC get value wey dey stays within few cents of dollar. Dis dey make dem pafet to dey earn abi dey sell. Plenti pipol for Latin Amerika don yus stabolcoins as one way to dey protect dem savings for taim wey dem nor too sure wit kurensy wey dem gofament don issue.

Plenti on stabolcoins

To dey borrow

To dey borrow money from disentralized providas fit kome in two ogbonge types.

Peer to peer wey mean say one borrowa go borrow from one spesifik lenda.
Do one wey base on pool wia lendas dey provide funds (liquidity) to one pool wey borrowas fit borrow from.

Make yu see dapps wey dey borrow

Plenti advantajis dey to dey yus one disentralized lenda...

To dey borrow wit privacy

Tuday, to dey lend and dey borrow monie dey revolve aroun di pesin wey dey involve. Bank nid sabi weda yu fit repay loan bifor lendin.

Disentralized lendin dey work witout party wey dey identify demsefs. Instead, di borrowa suppose bring kollateral wey di lenda go automatikaly risiv if dem nor nor repay dia loan. Some lendas dey even asept as kollateral. NFTs na one deed to one unik asset, like one painting. More on NFTs

Dis dey allow yu to borrow monie witout kredit sheks abi dey handol handing ova private informashon.

Access to global funds

Wen yu yus one disentralized lenda yu get assess to funds wey dem deposit from all ova di world, nor bi just di funds in di kountry of yur bank abi institushon wey yu shuse. Dis dey make loans dey more assessibol and impruf di intrest rates.

Tax-effishiensis

To dey borrow fit give yu ssess to di funds yu nid witout to nid to sell yor ETH (one taxabol event). Instead, yu fit yus ETH as kollareral for one stabolcoin loan. Dis dey give yu di cash-flow wey yu nid and allow yu kip yor ETH. Stabolcoins na tokens wey betta pass wen yu nid kash as dem nor dey fluctuate in value laik ETH. More on stabolcoins

Flash loans

Flash loans na eksperimental form of disentralized lendin wey dey allow yu borrow witout kollateral abi dey provide any pesina informashon.

Dem nor dey assessibol wella to non-teknika folks rite nau but dem hint at wetin fit dey possibol to efrione in di fushure.

Im dey work on di basis dat dem don komot and pay bak within di same transakshon. If im nor fit pay back, di transakshon dey revert as if nortin eva hapun.

Di funds wey dem yus somtaims dey for liquidity pools (big pools of funds wey dem yus to borrow). If dem nor dey yus dem for dat moment, dis dey kreate one opportunity for someone to borrow dis funds, kondut biznes wit dem, and ripay dem in-full well at di same taim dem borrow dem.

Dis mean sey plenti logik dey join in efri bespoke transakshon. One sampol eksampol fit bi someone wey dey yus one flash loan to borrow plenti asset at one price so dem fit sell am on difren ekshanj wia di price dey high.

So for one singol transakshon, di followin dey hapun:

Yu borrow X amount of $asset at $1.00 from ekshanj A
Yu sell X $asset on ekshanj B for $1.10
Yu fit pay back loan to ekshanj A
Yu kip di profit minus di transakshon fee

If ekshanj B supply don drop sudenly and di user nor fit buy enuf to kova di orijina loan, di transakshon go just fail.

Tu bi abol to do di above eksampol for di tradishonal finans world, yu go nid plenti amount of monie. Dis strategis wey dey make monie only dey assessibol to doz wit wealth wey dey exist. Flash loans na eksampol of one fushure wia to get monie nor dey necessary make dey make monie.

More wey dey on flash loans(opens in a new tab)

Start tu dey save wit crypto

Tu dey Lend

Yu fit earn interest on yur crypto by lendin am and yu dey see yur funds grow in real taim. Rite nau interest rates plenti pass wetin yu fit get for yor lokal bank (if yu dey lucky enuf to bi abol to assess one). Here na eksampol:

Yu lend yur 100 Dai, one stabolcoin, tu one product laik Aave.
Yu risiv 100 Aave (aDai) wey bi one token wey dey reprisent yur Dai wey yu loan.
Yur aDai go inkrease base on di interest rates and yu fit see yur balans as im dey grow for yur wallet. E dipend on di , but yur wallet balans go show somtin laik 100.1234 afta one few days abi even hawas!
Yu fit witdraw one amount of regular Dai wey dey di same tu yur aDai balans at any taim.

See lending dapps

No-loss lotteries

No-loss lotteries laik PoolTogeda na fun and new way tu save monie.

Yu buy 100 tickets as yu dey yus 100 Dai tokens.
Yu risiv 100 plDai wey dey reprisent yur 100 tickets.
If dem pick one of yur tickets as di winna, yur plDai balans go inkrease by di amount of di price pool.
If yu nor win, yur 100 plDai go roll ova tu next week's draw.
Yu fit witdraw one amount of regular Dai wey dey di same tu yur plDai balans at any taim.

Dem don generate di prize pool by all di interest wey dem generate by lendin di ticket dem deposit laik in di lending eksampol above.

Try PoolTogeda(opens in a new tab)

Ekshanj tokens

Plenti tokens on Ethereum. Disentralized ekshanjis (DEXs) dey allow yu trade difren tokens weneva yu want. Yu nor dey eva give up kontrol of yur assets. Dis bi laik to dey yus one kurensy ekshanj wen yu dey vist difren kountry. But di DeFi vashon nor dey klose. Di markets na 24/7, 365 days a year and di teknologi guarantees say always pesin go dey to asept trade.

For eksampol, if yu wan yus di no-loss lottery PoolTogeda (wey dem deskribe above), yu go nid token laik Dai abi USDC. Dis DEXs dey allow yu to swap yor ETH for doz tokens and back again wen yu don finish.

See token ekshanjis

Trading wey don advans

Plenti opshons wey don advans for tradas wey laik to littol more kontrol. Limit orders, perpetuals, margin trading and more dey possibol. Wit Disentralized trading yu get assess to global liquidity, di market neva klose, and yu dey always kontrol yur assets.

Wen yu see one sentralized ekshanj yu nid to deposit yor assets bifor di trade and trust dem to look afta dem. As dem don deposit yur assets, dem dey at risk as sentralized ekshanjis na atractive targets for hackers.

See trading dapps

Grow yor portfolio

Fund manajment products dey on Ethereum wey go try to grow yor portfolio base on one strategy of yur shoise. Dis na automatik, open to efrione, and nor nid human manaja to dey take one kut of yur profits.

One gud eksampol na di DeFi Pulse Index fund(DPI)(opens in a new tab). Dis na fund we dey rebalans automatikaly to make sure sey yur portfolio dey always inklude di top DeFi tokens by market kapitalizashon. Yu neva nid to manaj any of di details and yu fit witdraw from di fund weneva yu laik.

See investments dapps

Fund yor ideas

Ethereum na ideal platform for crowdfunding:

Potenshia fundas fit kome from anywia - Ethereum and im tokens dey open to anybody, anywia in di world.
Im dey transparent so pipol wey dey raise funds fit pruf hau much monie dem don raise. You fit even trace hau funds dem don spend later down di line.
Pipol wey dey raise funds fit set up automatik refunds if, for eksampol, one spesifik deadline and minimum amount wey dem neva meet.

See crowdfunding dapps

Quadratic funding

Ethereum na open source softwia and dem don fund plenti of work so far by di komunity. Dis don lead to di growth of one interesting new fundraising model: quadratic funding. This has the potential to improve the way we fund all types of public goods in the future.

Quadratic funding makes sure that the projects that receive the most funding are those with the most unique demand. In other words, projects that stand to improve the lives of the most people. Here na hau e dey work:

Dem get one matching pool of funds wey dem donate.
One round of publik funding starts.
Pipol fit signal dem demand for one project by donating some monie.
Wons di round don finish, dem don distribute di matching pool to projects. Doz wey dey wit demand wey unik pass don get amount wey high pass from di matching pool.

Dis mean sey Project A wit im 100 donashons of 1 dollar fit end up wit more funding pass Project B wit one singol donashon of 10,000 dollars (im dipend on di size of di matching pool).

More on quadratic funding(opens in a new tab)

Insurance

Disentralized insurans wey aim to make insurans sheap pass, fasta to pay out and dey more transparent. Wit more automashon, koveraj dey more affordabol and pay-outs dey quick wella. Di data yus to deside on yor klaim dey transparent kpatakpata.

Ethereum products, like any softwia, fit suffa from bugs and exploits. So rite nau, plenti of insurans products in di space fokus on protectin dem users against loss of funds. Anyhau e bi, projects don start to dey build out koveraj for efritin wey life throw at us. One gud eksampol of dis na Etherisc's Crop kover wey dey aim to protect smollholda farmers in Kenya against droughts and flooding(opens in a new tab). Disentralized insurans fit provide sheapa kover for farmers wey somtaims don price out tradishonal insurans.

See insurans dapps

Aggregators and portfolio manajas

Wit plenti tins wey dey hapun, yu go nid one way to kip track of all yur investments, loans, and trades. one host of products dey wey allow yu koordinate all yur DeFi aktivity from one place. Dis na di beauty of DeFi's open architekshure. Teams fit build out intafaces wia yu fit just see yor balans akross products, yu fit yus dia features too. You fit find dis yusful as yu explore more of DeFi.

See portfolio dapps

Hau DeFi dey work?

DeFi dey yus cryptocurrencies and smart kontracts tu provide savis wey nor nid middol men. For tuday finanshia world, finanshia institushons do as guarantors of transakshons. Dis dey give dis institushons immense pawa bikos yur monie dey flow thru dem. Plus billions of pipol around di world nor even fit access one bank akant.

In DeFi, one smart kontract dey replace di finanshia institushon in di transakshon. One smart kontract na type of Ethereum akant wey dey hold funds and wey fit send/refund dem based on certain kondishons. Nor one fit shanj dat smart kontract wen im dey live - im go always run as dem program am.

One kontract wey dem don disign to hand out one allowans abi pocket monie fit dey program to send monie from Akant A to Akant B efri Friday. And im go only eva do dat as long as Akant A get di funds im rikwaya. Nor one fit shanj di kontract and add Akant C as one recipient to steal funds.

Kontracts na also publik for anyone to inspet and audit. Dis means bad kontracts go often kome unda komunity krutiny pretty kwik-kwik.

Dis mean sey nid dey to trust di more teknika membas of di Ethereum komunity wey fit read kode. Di open-sorse komunity dey helep shek divelopa, but dis nid go diminish ova taim as smart kontrats bikom izy pass to read and oda ways to pruf sey dem don divelop trustworthiness of kode.

Ethereum and DeFi

Ethereum na di pafet foundashon for DeFi for one numba of rizins:

No one owns Ethereum abi di smart kontracts wey dey live on am – dis dey gives efrione an oportunity to yu DeFi. Dis also mean say nor one fit shanj di rules on yu.
DeFi products dey speak di same language behind Di scenes: Ethereum. E mean say many of di products dey work togeda seamlessly. Yu fit lend tokens on one platform and eksanj di interest bearing token in one difren market on difren applikashon. Dis na laik to bi abol to cash loyalty points for yur bank.
Dem don build tokens and crytocurrency into Ethereum, one shia ledger - wey dey kip track of transakshons and ownaship na kinda Ethereum tin.
Ethereum dey allow komplete finanshia fridom - products wey popular pass nor go eva fit take kustody of yur funds, e dey leave yu in kontrol.

Yu fit tink of DeFi in layers:

Di blockchain - Ethereum dey contain di transakshon history and state of akant.
Di assets - ETHand di oda tokens (currencies).
Di protokols - wey dey provide di functionality, for eksampol, one savis wey dey allow for disentralized lending of assets.
Di aplikashons - di products wi dey manaj and take enta di protokols.

Note: na majority of DeFi dey yus di . Aplikashons wey dey DeFi dey yus one wrapper for ETH wey dem dey koll Wrapped Ether (WETH). Make yu learn more abou wrapped ether.

Build DeFi

DeFi na open-source movement. Di DeFi protokols and aplikashons dey open for yu tu inspect, fork, and innovate on. Bikos of dis layered stack (dem dey shia di same base blockchain and assets), protokols fix dey mix and match tu unlock unik kombo oportunitis.