DeFi could become the next big thing in finance – Mashable

DeFi is taking over the crypto world.
DeFi is taking over the crypto world.
Image: Nuthawut Somsuk/getty images

DeFi, or decentralized finance, is turning into the most important nascent trend in finance. 

The ability to borrow funds, take out loans, deposit funds into a savings account, or trade complex financial products — all that without asking anyone for permission or opening an account anywhere — is quickly gaining traction. The amount of money locked into various DeFi services has recently surpassed $2 billion, according to DeFi Pulse, up from about $1 billion a month ago. But it’s not just about the money — other assets are being sucked into the DeFi ecosystem. 

Let’s take a couple steps back. DeFi, which is built on cryptocurrency platforms such as Ethereum and Cosmos, cuts out human middlemen and paperwork, and replaces them with smart contracts. These are computer programs that run on decentralized blockchains, meaning they’re near-impossible to stop or censor. If I borrowed money to someone via a smart contract, the terms built into the contract have to be obliged — no human can (typically) alter