Is Defi Right For You? By Defi Dad

You’ve probably heard the buzz about this thing called DeFi. It stands for decentralized finance and it simply refers to new peer to peer money applications, built on the Ethereum blockchain. Why money applications? Think of your money and banking services today like letters we wrote to communicate before email. DeFi is going to evolve money and antiquated banking services similar to the way email transformed our ability to communicate. It is value you cannot unsee, once you see it.

The secret is that DeFi is already humming with close to $2.5 billion in value being exchanged across the top DeFi apps listed here. Users of DeFi are saving time, saving money, and being empowered to do things with their money, previously thought to be not possible.

These apps cover a wide range of utility including:

• Saving interest
• Lending and borrowing
• Trading (market swaps)
• Margin trading
• Futures
• ETF-like exposure
• Derivatives for indices, commodities, and Forex
• Options
• Insurance
• Sports betting, games and more!

The next question should be “what qualifies as DeFi?” Here’s some questions I ask myself to be sure I’m using DeFi and not being misled by an app claiming to be DeFi.

• Is it built on Ethereum?*
• Am I required to connect an Ethereum wallet to get started? (ie MetaMask)
• Am I 100% in control of my assets via this wallet?
• Am I interacting only with the app’s smart contracts but no human middlemen?
• Am I not required to submit to any KYC (Know-Your-Customer)?
• Are there no geographical restrictions to using this app?**
• Is there no minimum to participate?**

*Not mandatory but worth noting 99% of DeFi is built on Ethereum.

**Neither of these traits should be interpreted as disqualifiers of an app from being DeFi, especially since