1. What is DeFi?
Decentralized finance, DeFi, lets users access financial services directly on a blockchain without intermediaries such as banks or brokerages. Code, or smart contracts, implements familiar services such as deposits, loans, trading and insurance.
Simply put, it is “banking without a bank”: earning interest on savings, borrowing and exchanging currencies. The source describes these services as accessible to anyone, anywhere, around the clock.
💡 Market size quoted in the original guide
Total value locked, TVL: More than approximately $150 billion, or ₩200 trillion. Users: More than 10 million. Protocols: Thousands. Main chains: Ethereum, Solana, BNB Chain and Arbitrum.
2. Traditional finance versus DeFi
- Operator: Banks and brokerages versus smart-contract code.
- Access: Identification and credit requirements versus anyone with a wallet in this comparison.
- Hours: The source compares business days, 09:00–16:00, with 24/7/365.
- Transparency: Private internal records versus transactions publicly recorded on a blockchain.
- Deposit yield: Quoted as 1–3% annually versus a variable 3–15%.
- Intermediary fees: Quoted as high, 1–3%, versus low, 0.01–0.3%.
3. Main types of DeFi
1. Decentralized exchanges, DEXs
Users can exchange coins directly without a centralized exchange such as Upbit or Binance.
- Uniswap: Described as Ethereum's largest DEX.
- Jupiter: Described as Solana's largest DEX aggregator.
- PancakeSwap: Described as BNB Chain's largest DEX.
2. Lending and borrowing
Depositing coins can earn interest, while posting coins as collateral enables borrowing.
- Aave: A multichain lending protocol, ranked first by TVL in the source.
- Compound: An early Ethereum lending protocol.
- MakerDAO: DAI stablecoin issuance and collateralized loans.
3. Liquidity provision, LP
Supply funds to a DEX and receive a share of trading fees as income. The source calls this one of the more accessible return-seeking methods for beginners.
4. Staking
Commit coins to a network and receive rewards for participating in its operation. The guide quotes 3–5% annual returns for Ethereum staking.
4. Ways to seek DeFi returns
5. Getting started
- Create a wallet: Install MetaMask for Ethereum or Phantom for Solana.
- Back up the seed phrase: Write its 12–24 words on paper and store it securely. The source's rule is never to store it digitally.
- Transfer coins: Send ETH or SOL from Upbit or Binance to the wallet.
- Open a DeFi protocol: Connect the wallet on a website such as Aave or Uniswap.
- Trade or deposit: Use the desired feature.
🚨 DeFi security rules
• Never share your seed phrase.
• Use official URLs and bookmark them.
• Do not approve unfamiliar tokens.
• Use audited protocols according to the guide's rule.
• Test with a small amount before committing more.
6. DeFi risks
- Smart-contract bugs: Vulnerabilities can lead to hacked funds. The source cites billions of dollars in hacking losses during 2023–2025.
- Impermanent loss: Relative price changes can cause losses when providing liquidity.
- Rug pulls: Operators remove liquidity and disappear.
- Regulatory risk: Governments may tighten DeFi regulation.
- Gas fees: Ethereum mainnet fees can reach $5–$50 per transaction in the source's range.
7. The future of DeFi
DeFi remains early-stage in the original guide's assessment, with potential to replace traditional finance. Emerging themes include tokenized real-world assets, AI and DeFi integration, and institutional DeFi.
For readers who find direct DeFi participation difficult, the source suggests AI Bitcoin-futures trading as another way to participate in crypto markets, describing NOONOO TRADING as operating automatically around the clock.
🃏 The source's easier alternative to DeFi
The original guide promotes AI trading as requiring no wallet or gas fees and claims there is no hacking risk.
View the results of automated AI trading.