The process of adding assets to a blockchain ledger. This is done to make assets easier to access and transfer.

Asset tokenization 

These are protocols designed to mitigate issues in centralized exchanges such as the requirement of trust. For example, trade execution occurs automatically through a smart contract rather than through facilitation by a central exchange.

Decentralized exchange protocols

These are lending platforms that require neither lender nor borrower to identify themselves, increasing the level of privacy.

Decentralized lending platforms

These are derivative products where the contract used has multiple independent data sources.

Decentralized derivatives

The management of assets through the blockchain. Unlike traditional asset management, there is no need for a custodian. 

On-chain asset management

Decentralized Autonomous Organizations that offer Bond Services:
- Olympus DAO
- Hector DAO
- FantOHM

DeFi Bond Protocols

- Asset tokenization
- Decentralized exchange protocols
- Decentralized lending platforms
- Decentralized derivatives
- On-chain asset management 

New York University

DeFi or Decentralized Finance is financial infrastructure built on blockchain. It is based on open protocols and decentralized applications. Smart contracts serve as the backbone of DeFi. Overall, it is much more open and transparent than traditional financial services. DeFi offers financial instruments without relying on central financial institutions such as banks and brokerages.

DeFi

Schär, Fabian, Decentralized Finance: On Blockchain- and Smart Contract-based Financial Markets (March 8, 2020). Available at SSRN: https://ssrn.com/abstract=3571335 or http://dx.doi.org/10.2139/ssrn.3571335 



Decentralized Finance: On Blockchain and Smart Contract-based Financial Markets

- Settlement layer
- Asset layer
- Protocol layer
- Application layer
- Aggregation layer

5 Layers of DeFi architecture (The DeFi Stack)

Key DeFi Terms

The principal risks DeFi faces today are smart contract, governance, oracle, scaling, exchange, custodial, DEX, and regulatory risks. DeFi allows developers to create new types of financial products and services, expanding the possibilities of financial technology. While DeFi can eliminate counterparty risk, cutting out middlemen and allowing financial assets to be exchanged in a trustless way, as with any innovative technology, the innovations introduce a new set of risks.

Defi Risks

DeFi References

- Centralized financial system

- Inefficiency

- Lack of interoperability

- Opacity 

- Limited access


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