Community-Led Finance

Definition ∞ Community-led finance represents financial systems or services where governance, decision-making, and operational control reside primarily with a distributed group of participants rather than a centralized entity. This model prioritizes collective ownership and transparent, participant-driven processes for financial activities. It contrasts sharply with traditional financial structures controlled by singular corporations or governmental bodies.
Context ∞ In the digital asset space, community-led finance is a central tenet of decentralized finance (DeFi), with news often covering its growth and regulatory challenges. Key discussions involve the effectiveness of decentralized autonomous organizations (DAOs) in managing significant capital and the potential for greater financial inclusion. The ongoing evolution of these models highlights shifts in power dynamics within global financial systems.