Definition ∞ Base Layer DeFi refers to decentralized finance applications and protocols built directly on a blockchain’s foundational layer. These systems utilize the core security and settlement assurances of the underlying network. They establish the fundamental infrastructure for more complex financial operations within the digital asset ecosystem. This foundational layer provides the essential components for secure and transparent transactions.
Context ∞ The ongoing discussion surrounding Base Layer DeFi often addresses its scalability limitations and transaction costs, particularly on highly utilized networks. There is a continuous push for solutions that enhance throughput without compromising decentralization or security. Key developments include the emergence of new layer one blockchains optimized for DeFi and improvements to existing base layers through upgrades that boost performance.
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