DeFi (Decentralized Finance) refers to financial services built on blockchain technology that operate without traditional intermediaries like banks, brokerages, or exchanges.
Core DeFi services include: Lending and Borrowing (Aave, Compound), Decentralized Exchanges (Uniswap, Curve), Stablecoins (DAI, USDC), Yield Aggregators (Yearn Finance), and Derivatives (dYdX, GMX).
Key DeFi concepts include Total Value Locked (TVL), Liquidity Mining, Composability (protocols building on each other), and Permissionless access for anyone.
DeFi advantages include 24/7 availability, no KYC requirements, global access, and self-custody. Risks include smart contract vulnerabilities, impermanent loss, liquidation risk, and regulatory uncertainty.