Introducing decentralized finance

As its name suggests, DeFi is a decentralized version of the financial products and services that we normally saw and transacted with in our daily lives before blockchain and Bitcoin. It is a set of block-native digital products and services powered by blockchain technology and a decentralized network.

In the first edition of this book, we touched a little on the DeFi movement. Since then, DeFi has been evolving into a virtual parallel to traditional finance. In fact, over the last 30 years (since the start of the internet and the World Wide Web), newcomers and digital disruptors have been bringing in convenience, digitization, automation, and innovation to disrupt the traditional financial markets and provide customers with an instant and seamless consumer experience. This gave rise to a new finance technology service called Fintech. Notable firms include PayPal, Square (later renamed Block), and Stripe. Together with payment technology giants...