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Introduction to Decentralized Finance – DeFi

Introduction to Decentralized Finance – DeFi

Knowledgebase
21/07/2020 by Koinal
96
The original intention behind cryptocurrency was to create a system of money, value, and payments and make it accessible to everyone. The idea was to open digital currency to every person on the globe without restrictions or permissions from central authorities. A movement called Open Finance, or Decentralized Finance seeks to make all financial services accessible to anyone with access to the Internet.
Introduction to Decentralized Finance

The Open Finance movement would transform traditional finance functions like banking, loans, savings, insurance, and similar items into decentralized technologies. It would be a global alternative for the financial services now only available through centrally-controlled institutions and governments.

Why Do We Need Decentralized Finance?

Many millions lack access to financial services across the globe, and many millions more have limited or restricted use of financial systems. Some studies place the number as high as 1.7 billion people that lack sufficient access to financial services. The lack of financial assistance can limit individual and group progress because it limits participation in the local and global economy. An open system without the need for permissions from governments, third parties, and central authorities could enable global economic growth. 

Some many reasons and barriers prevent access to financial systems around the world. Some are due to governmental actions, while many people live in poverty and neglect conditions that have existed over many decades. Modern technology offers a new day for financial services. The Internet can be a pathway to financial freedom for a large part of the world’s under-served populations.

People could access financial services from any location with Internet service on any available equipment like computers, laptops, Smartphones, tablets, and mobile devices. At Koinal, we take pride in offering services for every level of knowledge and experience with cryptocurrency. Whether new or experienced, we can provide quick and reliable transactions using bank cards.

So, What Is Decentralized Finance?

DeFi is a short way to say decentralized finance; decentralized finance is an outgrowth of blockchain technology platforms accepting smart contracts. Many progressive thinkers view decentralization as an essential pathway for future growth. Decentralized finance systems use codes and Ethereum-type platforms to establish and carry out financial transactions without human interference or assistance. 

DeFi products are services and functions that can exist in a decentralized financial environment. These products include savings and loan services, credit, and banking services. Software developers create services through DeFi applications, also called DeFi DApps. The Ethereum platforms can accept decentralized applications that include smart contracts and computer software applications. Innovators and developers can modify existing applications, create new ideas, and place them on public access platforms.

Decentralized Cryptocurrency Trading 

Decentralized exchanges are another example of an application of decentralized finance. Regular exchanges typically hold digital currencies and move a system of titles or ownership to carry out transactions. A decentralized exchange does not have a central function or place to store coins. It is essentially a peer-to-peer operation that the exchange or organization makes possible, safe, and secure. Binance is a centralized exchange. The shares of cryptocurrency exchanged on Binance exist in a central platform.

Binance Dex is a decentralized exchange operated by the Binance organization. The shares of cryptocurrency move from account to account as arranged by the buyer and seller. Binance Dex helps buyers and sellers carry out transactions and typically charges a transaction fee. 

Koinal works with leading cryptocurrency exchanges and some that offer DeFi products such as Binance ( Binance Dex). Koinal can help you purchase cryptocurrency that you can trade or sell in any way that you choose, including the decentralized exchanges like Binance Dex.

We at Koinal are ready to assist your efforts to enter or expand your involvement with cryptocurrency. We offer the critical option of purchasing cryptocurrency from leading exchanges using bank credit and debit cards.

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