Definition ∞ A DeFi broker acts as an intermediary within decentralized finance, facilitating user access to various DeFi protocols and services. Unlike traditional brokers, these entities often operate through smart contracts, enabling peer-to-peer transactions without a central custodian. They aggregate liquidity, optimize lending or borrowing rates, and simplify complex DeFi interactions for users. This role aims to streamline participation in decentralized markets.
Context ∞ The evolving definition of a DeFi broker is a subject of regulatory scrutiny, as authorities seek to classify and oversee these entities within existing financial compliance frameworks. Discussions often center on whether they constitute regulated financial service providers, particularly concerning anti-money laundering (AML) and know-your-customer (KYC) requirements. Future developments will likely involve clearer regulatory guidance and the emergence of more standardized operational practices for these decentralized intermediaries.
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