How Decentralized Finance Works on Ethereum
Decentralized Finance (DeFi) has been one of the most groundbreaking developments in the blockchain and cryptocurrency space. With Ethereum at its core, DeFi opens a world where traditional financial services such as lending, borrowing, trading, and saving are all executed through smart contracts and decentralized protocols. In this article, we’ll dive deep into how DeFi works on Ethereum, uncovering its key components and what makes it so revolutionary. What is DeFi? At its core, DeFi refers to financial services that are decentralized, meaning they are not controlled by any central authority, such as a bank or government. Instead, these services are powered by smart contracts on blockchain networks, removing the need for intermediaries and allowing anyone with internet access to participate. Ethereum, as the most widely adopted blockchain for DeFi, enables these decentralized applications (dApps) to run using its powerful smart contract functionality. Unlike Bitcoin, which is primar...