Decentralized Finance (DeFi) Restoring Financial Power to the Community

How much do you pay to send funds, especially when relaying it to a person in a different country? Are you discouraged by the extensive scrutiny done by financial organizations when issuing loans? Many are times when people feel that centralized financial services are complex and unnecessarily intrude on their privacy. Now, you have the opportunity to get better services and become an important pillar in changing how financial services are offered by joining decentralized finance (DeFi) platforms.

This post digs deeper into DeFi platforms to demonstrate how they work and why your input is so important. Check out the benefits to see what to anticipate from using DeFi platforms.

How Does DeFi Work?

Before looking at how the decentralization of the finance system works, let’s define its core pillars. DeFi was created out of necessity. It followed the realization that the traditional banking services came with a lot of limitations, such as the high cost of transactions.

DeFi works by creating a new way for people to access and use financial services. Instead of going for a loan in a bank, you simply visit a DeFi platform online. Then, the loan is processed in no time and cash is deposited in your account. So, here are the main pillars of DeFi platforms:

• Blockchain: This is the most important pillar because DeFi platforms operate as layers embedded on top of blockchain networks. Therefore, they are able to communicate with the blockchain and still provide the additional services that clients want.
• Crypto Coins: These are digital currencies that are created to only reside in their native currencies. You can use them like normal currencies, but both the sender and recipient must be on the same network. In DeFi platforms, you require cryptos to pay for various services, such as staking or lending.
• Crypto Wallet: Like a standard wallet, which you can use to store fiat coins and notes, crypto wallets are used for storing digital coins. Because the coins are not minted and only exist in crypto networks, the wallets only store a string of codes.

Emerging Benefits of DeFi Platforms 

The main benefit that the community enjoys from using DeFi platforms is the simplicity of financial transactions. Because there is no centralized authority to review customer details and applications, incentivized nodes complete them fast. Here are the other benefits that you should anticipate when using a DeFi platform:

• Designed to make Transactions Cheap and Reliable

Imagine how long it takes to drive to the nearest bank to fill forms for loan applications. Even after submitting the applications, the review will take longer, and that does not guarantee you will get a loan. DeFi platforms help to cut the process down so that it only takes a matter of minutes to get transactions completed.

• Offers Awesome Opportunities to Make Passive Income 

To help you generate some revenue to supplement what you are earning, DeFi platforms can come in handy. With services such as crypto staking and yield farming, you are sure of growing your investment with a significant margin. Staking is particularly helpful because you make passive income without selling your crypto coins.

• You can Start Making Passive Income Immediately After Buying Crypto Coins 

Unlike assets such as properties and bonds that require one to wait over a long period before making some returns, DeFi makes that happen in minutes. When you buy proof of stake (POS) coins, it is possible to start earning in the next couple of minutes. You only need to identify an appropriate DeFi platform and send the coins into the pool. In the next minute, the coins might be active, helping validate transactions and grow your passive income.

Decentralized finance (DeFi) is the new way to simplify acquiring and using financial services. Unlike the standard banking model, the transactions in DeFi are decentralized so that they are completed fast and affordably. Remember that you need to use an appropriate DeFi platform, such as Mantra Dao, to enjoy all the benefits we have listed above. Do not get content with the inefficient financial services as we know them today. It is time to explore crypto and blockchain-based benefits.