DeFi is the short form for ‘Decentralized Finance’. It's a term for a variety of financial applications that aims at disrupting traditional financial intermediaries. These applications are normally built on a public blockchain making them open for anyone to use. It's also transparent as everyone involved can track any transaction via the blockchain explorer.

Since DeFi applications operate without a central service exercising any sort of control over the entire system, it allows individuals to stay pseudonymous while managing their assets. Buyers, sellers, lenders, and borrowers are able to interact via a smart contracts instead of having a middleman (company or institution) facilitating transactions.

Most DeFi applications are built on top of the Ethereum blockchain. However with the recent increased popularity of cross-chain interoperability and rising costs of usage due to network congestion, you will see other applications building out on alternative Layer 1, Layer 2, and side chains - examples of such are Polygon, Solana, Fantom, Avalanche, and Arbitrum.

Below are popular services that people frequently use

• Lending: Loan out your crypto and earn interest/rewards on it by the minute.
• Borrowing: Deposit collateral to immediately get a cash loan on it, no questions asked.
• Decentralized Exchanges: Swap your crypto assets instantly without going through any sort of registration or KYC process.
• Yield Farming: Help provide liquidity to a protocol in exchange for governance tokens.
• Derivatives: Make long or short bets on certain assets. Similar to stock options or futures contracts.