Because of the height that has had decentralized finance systems in recent months, there are endless farms that allow you to earn tokens by placing new assets in these pools of liquidity. Well, I won't explain the technical details, but it will be an analysis for those who want to know how it works and how to serve everything in a simple way.
Reference image taken from: https://twitter.com/CryptoDiffer/
DEFIs, how do you eat this?
Its extended name is decentralized finance, basically smart contracts, bots, protocols or DEX applications are used. Something similar to some service applications born last century called FinTech, in which partners were connected that could interact with this ecosystem without intermediaries.
But, now in the XXI century we can make use of these resources designed in the past since technology allows us to advance, it is made possible thanks to the blockchain: If this great technology that has been developing more and more, and it is possible to have more usage applications.
Now the answer to my question: In the current DEFI ecosystems you can participate in financial services anywhere in the world in a decentralized way, of course it can be connected to the internet, you can invest in cryptocurrency, tokens, etc. It is something like a bank that generates interest or in which you can buy different financial instruments but without the need to resort to a bank or depend on someone. These investments range from lending your money and receiving interest to buying unique collectible cards that can cost pennies to thousands of dollars.
♔ Can you make the banking system as we know it disappear?
I think that this question that I have asked myself is subjective but my answer is that if solid proposals are created that generate a high degree of trust in savers, they can mobilize large sums of money to receive returns that banking systems will not give to people, And that for the following, when you deposit your money in the banks they are used for investments and then a small and insignificant interest is applied to your account.
The opposite happens in the DEFI you are responsible for your finances and all funds are protected by your personal keys.
♔ Now what do we all want to hear why should I use them?
Everyone at some point in the crypto world we heard lately about UNISWAP, well I started with this project because most of the projects were born from this, basically it is a decentralized exchange in which anyone can participate, you can add liquidity and earn interest or simply use them to switch from one to another, and best of all, you DO NOT have to give your personal information.
For now this is all, I hope to continue in a next edition talking about the DEFIs, if you have any questions and want it to appear and of course be answered write to my social networks indicated below.
Luis Rivero, Mathematics, cryptocurrencies and analysis.
Twitter: @ Luro900
Telegram: @ luro900
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Sources:
https://es.cointelegraph.com/explained/defi-what-it-is-and-its-impact-on-the-crypto-world
https://es.cointelegraph.com/tags/fintech
https://medium.com/@qolkrex/los-%C3%BAltimos-dos-meses-el-mercado-de-las-criptomonedas-ha-sufrido-incre%C3%ADbles-sacudidas-gracias-a-la-199fad433e2b