DeFi Financing

Definition ∞ DeFi financing refers to financial services provided on decentralized blockchain networks, without traditional intermediaries. These services include lending, borrowing, and trading using smart contracts. It enables peer-to-peer financial transactions with increased transparency and accessibility. DeFi financing represents a shift towards a more open and permissionless financial system.
Context ∞ DeFi financing is a rapidly evolving sector, characterized by innovation in financial products and increasing user adoption. Debates often focus on regulatory oversight, security vulnerabilities within smart contracts, and the sustainability of high yields. Future developments will likely center on enhancing protocol security, improving user experience, and achieving broader institutional participation in decentralized finance.