An on-chain strategy refers to a set of rules or actions executed directly on a blockchain network, typically through smart contracts. These strategies involve automated decision-making and transaction execution without relying on off-chain intermediaries. Examples include automated market making, lending protocols, and yield farming. The transparency and immutability of the blockchain verify these operations.
Context
On-chain strategies are central to decentralized finance and are frequently discussed in crypto news, highlighting innovations in automated trading, liquidity provision, and governance. Reports often cover the performance of various DeFi protocols and the risks associated with complex smart contract interactions. The debate involves the security of these automated systems and their susceptibility to exploits or economic manipulations. Future developments focus on improving smart contract auditing, composability, and the efficiency of on-chain operations.
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