Advantages of decentralized Finance
with the diversification of network service forms, the decentralized network model becomes more and more clear and possible. After the rise of Web2.0, the services provided by Wikipedia, Flickr, blogger and other network service providers are decentralized. Any participant can submit content, and Internet users can create or contribute content together
decentralization is a phenomenon or structure, which can only appear or exist in a system with many nodes or in a group with many indivials-- Cloud financial services for you
1. The central node grasps the information of distributed nodes
2. The sub nodes do not master the information of other nodes (centralization, non-public transactions)
moreover, the pain point of centralization is that the security of the system depends on the security of the central node, and the distributed node has no control over it.
The decentralized forecasting platform has long been a popular financial tool to avoid risks and speculate on global events. A decentralized forecasting market can do the same, but it has cryptocurrency and cannot censor the market. Aug has provided everything from politics and weather forecasting to dealing with the risks of real-world financial or adverse events
4. The role of exchange and open market is realized through decentralized exchange (DEX). DEX is a P2P market of Ethereum assets between two parties, in which no third party acts as the intermediary of transaction. Therefore, they are different from centralized exchanges like coinbase & Co. in this respect. Some DEX also use some highly innovative token exchange methods, such as atomic exchange and other non storage methods to exchange one asset for another with minimum settlement time and risk
other types of open markets focus on the exchange's irreplaceable token (NFT), commonly known as cryptocurrency collectibles. Platforms such as opensea and ratebits facilitate the search and purchase / sale of cryptocurrency assets, ranging from NFT in games such as cryptokitties to virtual parcels in decentraland games. Even some markets, such as district0x, are said to allow users to create their own exchanges and vote on management programs. Current examples of DEX providing cryptocurrency transactions include currency DEX and ether Delta
Stable currencynow, there are many types of stable currency. Part of the difference between them is how they issue coins, how they check their reserves and how they price them. Stable token is a token issued by blockchain to maintain stable value. It is usually linked to dollars, gold or other external assets to achieve this goal. Generally speaking, stable currency can be divided into the following three categories:
< UL >cryptocurrency pledge stable currency includes maker's Dai. However, the stable currency supported by legal tender is by far the most popular stable currency in the market. The first is tether, although there are many alternatives. The models of these stable currencies are similar to each other. For all of this, the user must trust the provider. Some provide regular and voluntary audits to build the necessary trust through transparency
stable currency without pledge is neither centralized nor supported by cryptocurrency assets. They are based on algorithms to maintain stable values. In short, the algorithm takes supply and demand as parameters and adjusts them to keep balance. The foundation is a pioneer in this category, but it failed e to regulatory considerations. As a result, the project was abandoned
The future of defi - what's the potential< p> The final question, of course, is what the potential of the whole defi movement is? Basically, there are a lot of things that are simply exaggerated in the field of cryptocurrency. The immeasurable potential is attributed to the vision, so the actual proct has no chance to realize the exaggerated expectations. Then there's serious disillusionment and boredom. However, compared with defi, it is different because there are already some finished procts, such as maker, and the market has well accepted themnevertheless, we are still in the early stage of the whole defi movement. But the potential behind it is enormous. Even if only a small number of defis (such as lending) succeed in the future, that's more than enough. If the defi ecosystem can provide better conditional lending than most national banks and other lending institutions, it could lead to global adoption
but this is also one of the biggest obstacles that we have to overcome in the field of defi. On the one hand, more ecation is needed so that the masses can even know the existence of this alternative method. As before, only a small number of people worry about issues related to cryptocurrency and blockchain technology. In particular, there are even fewer people dealing with the defi department, and they have not even heard of it. On the other hand, the user friendliness of such procts must be greatly improved, so as to lay the necessary road for the public to use the procts and for global adoption
blockchain is an important concept of bitcoin. It is essentially a decentralized database. At the same time, as the underlying technology of bitcoin, it is a series of data blocks generated by using cryptographic methods. Each data block contains a batch of bitcoin network transaction information, which is used to verify the effectiveness of its information (anti-counterfeiting) and generate the next block
blockchain is unified in the whole network, so it is logically centralized. From the perspective of architecture, blockchain is based on peer-to-peer network, so it is decentralized. From the perspective of governance, blockchain makes it difficult for a few people to control the whole system through consensus algorithm, so it is decentralized.
A. indivials with asset management needs do not need to trust any intermediaries, and the new trust is rebuilt on the machine and code
B. everyone has access, no one has central control
C. all protocols are open source, so anyone can cooperate on the protocols to build new financial procts and accelerate financial innovation under the network effect
defi is a relatively broad concept, including currency issuance, currency transaction, loan, asset transaction, investment and financing, etc
we regard the birth of BTC and other cryptocurrencies as the first stage of decentralized finance. However, the decentralization of currency issuance and storage only provides a point-to-point settlement solution, which is not enough to support the rich financial business. The rapid development of decentralized lending agreements in the past two years will have the opportunity to further open the financial system of the blockchain world and bring decentralized finance into the second stage<
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and enter the column
almost every supporter of encryption start-ups has a trend, that is, to use the decentralized value of blockchain technology to sell their business fundamentals
in this paper, we will explain the differences between decentralized financial agreement business and traditional business:
we will mainly discuss two aspects:
1) what is the real meaning of defi
2) what are the types and main differences of defi platforms< Users of traditional financial systems often want to build a system that is easier to access, more transparent, lower transaction costs and less dependent on intermediaries. To build such a more equitable financial system, banks, loans and derivatives must undergo fundamental changes. In addition, a decentralized ecosystem, such as defi, is needed. It promotes P2P lending, eliminates centralized control, and provides users with financial freedom
recently, in the field of cryptocurrency, there are many discussions about defi. It provides financial services to the world: loans, derivatives and other procts. Moreover, the role of traditional financial intermediaries has weakened, or even failed to play a role. Proponents of a decentralized financial system see defi as a good alternative to traditional lending. Some have called it the future of borrowing
defi is built on public blockchains such as bitcoin network and Ethereum. It has become one of the "core drivers" on the Ethereum network. By using unlicensed distributed networks, the defi platform converts financial procts into untrusted protocols that can be accessed by anyone anywhere in the world. People who don't have an account in the bank can also use the defi solution to loan and borrow assets, as well as to trade with financial instruments
open source platforms provide users with great benefits, including transparency, cheap cross-border transactions, no credit checks and less censorship. Anyone can carry out financial activities because there is no geographical restriction<
the degree of decentralization of defi
in recent months, the introction of defi solutions has proliferated. They have different models and their degree of decentralization is also different. Compared with other models, some defi models have poor dispersion. This is because only a few of their components are decentralized, while the rest are still centrally controlled by the company
the establishment of agreement, non trust, price supply, determination of interest rate, provision of liquidity of margin call and start-up of margin call are the key components of defi agreement. They determine the degree of decentralization
if there are a large number of decentralized components, then the defi protocol is more decentralized than other models. Such a protocol will give users complete control over their digital assets and get rid of centralized control. So far, there is no single defi protocol that disperses all components
each defi protocol is assigned a category according to the number of distributed components:
centralized finance (cefi)
defi solutions are usually unmanaged, which means that users can control their funds and be responsible for their security. Instead, cefi is hosted. The central system is responsible for keeping the assets of users and ensuring the safety of users' funds
when it comes to loans or loans, users can't control any aspect of funds. The interest rate is determined by the central government, and the liquidity of margin call is provided by the central system or authorities. Cefi procts use centralized price supply, and it is also permitted to issue margin call. Thank you very much for your patience. If you have any help, please accept it. I wish you a happy life! thank you!
almost every supporter of encryption start-ups has a trend, that is, to use the decentralized value of blockchain technology to sell their business fundamentals
in this paper, we will explain the differences between decentralized financial agreement business and traditional business:
we will mainly discuss two aspects:
1) what is the real meaning of defi
2) what are the types and main differences of defi platforms< Users of traditional financial systems often want to build a system that is easier to access, more transparent, lower transaction costs and less dependent on intermediaries. To build such a more equitable financial system, banks, loans and derivatives must undergo fundamental changes. In addition, a decentralized ecosystem, such as defi, is needed. It promotes P2P lending, eliminates centralized control, and provides users with financial freedom
recently, in the field of cryptocurrency, there are many discussions about defi. It provides financial services to the world: loans, derivatives and other procts. Moreover, the role of traditional financial intermediaries has weakened, or even failed to play a role. Proponents of a decentralized financial system see defi as a good alternative to traditional lending. Some have called it the future of borrowing
defi is built on public blockchains such as bitcoin network and Ethereum. It has become one of the "core drivers" on the Ethereum network. By using unlicensed distributed networks, the defi platform converts financial procts into untrusted protocols that can be accessed by anyone anywhere in the world. People who don't have an account in the bank can also use the defi solution to loan and borrow assets, as well as to trade with financial instruments
open source platforms provide users with great benefits, including transparency, cheap cross-border transactions, no credit checks and less censorship. Anyone can carry out financial activities because there is no geographical restriction<
the degree of decentralization of defi
in recent months, the introction of defi solutions has proliferated. They have different models and their degree of decentralization is also different. Compared with other models, some defi models have poor dispersion. This is because only a few of their components are decentralized, while the rest are still centrally controlled by the company
the establishment of agreement, non trust, price supply, determination of interest rate, provision of liquidity of margin call and start-up of margin call are the key components of defi agreement. They determine the degree of decentralization
if there are a large number of decentralized components, then the defi protocol is more decentralized than other models. Such a protocol will give users complete control over their digital assets and get rid of centralized control. So far, there is no single defi protocol that disperses all components
each defi protocol is assigned a category according to the number of distributed components:
centralized finance (cefi)
defi solutions are usually unmanaged, which means that users can control their funds and be responsible for their security. Instead, cefi is hosted. The central system is responsible for keeping the assets of users and ensuring the safety of users' funds
when it comes to loans or loans, users can't control any aspect of funds. The interest rate is determined by the central government, and the liquidity of margin call is provided by the central system or authorities. Cefi procts use centralized price supply, and it is also permitted to issue margin call.