Composable Money Lego

Definition ∞ Composable money lego is a metaphor describing how various decentralized finance (DeFi) protocols and applications can be combined and interlinked like building blocks. Each protocol represents a distinct financial primitive, such as lending, borrowing, or exchanging assets. Their interoperability allows developers to construct new, sophisticated financial products and services. This modularity accelerates innovation within the digital asset ecosystem.
Context ∞ News frequently highlights new applications built using composable money legos, showcasing the rapid innovation in DeFi. The discussion often centers on the security risks introduced by combining many protocols, as a vulnerability in one component can affect others. Regulatory bodies are beginning to scrutinize the systemic risks associated with this interconnectedness.