Intermediate
DeFi fundamentals
Lending, swapping and liquidity pools without a bank in the middle.
7 min read
Smart contracts as financial services
Decentralised finance uses smart contracts to provide services like trading, lending and borrowing.
Liquidity pools
Automated market makers price assets using pools that users fund. Providers earn fees but face impermanent loss when prices diverge.
Key risks
DeFi removes intermediaries but not risk.
- Smart-contract bugs
- Oracle manipulation
- Liquidation during volatility
- Governance attacks