Onchain Finance

Definition ∞ Onchain finance refers to financial activities and services conducted directly on a blockchain network. This encompasses decentralized lending, borrowing, trading, and asset management executed via smart contracts. Transactions and asset ownership are transparently recorded and verified on the distributed ledger. It represents a system where financial operations are governed by code rather than intermediaries.
Context ∞ Onchain finance, often synonymous with Decentralized Finance (DeFi), is a rapidly evolving sector with continuous innovation and regulatory scrutiny. A primary discussion point revolves around balancing decentralization with necessary user protections and risk management. Upcoming advancements include improved scalability solutions and greater interoperability across different blockchain networks.