·4 min read
Even though Defi is an appealing idea, it is important to know that not everything is improved by decentralization.
Before creating a valuable foundation of open financial products, it is essential to identify the most prevalent use case for the blockchain’s characteristics.
I explain how Defi differs from other financial systems in this article.
Traditional Finance vs. Defi (Decentralized Finance)
Since anyone can start using Defi services by creating a wallet as long as they have some cryptocurrency to invest in with no requirement for identity verification, it might be claimed that accessibility is the only distinction between Defi and traditional finance. Unlike the traditional financial system, which has requirements like Know Your Customer (KYC) checks.
The distinction between Defi and traditional finance is how much better Defi makes financial inclusion for the unbanked.
Additionally, Defi offers varieties of services that are not attainable through traditional finance. The ability to create cutting-edge