If you’ve been around crypto, you’ve probably heard the term DeFi. But, what is DeFi and why is it important? DeFi (decentralized finance) is a financial technology that cuts the middleman out of the equation. Generally, a financial transaction requires a bank or other financial institution to approve and process a transaction. Whether you are looking for a mortgage for a new home or making a purchase with your credit card at your corner store, a financial institution stands between both parties (and charges a fee for the transaction).
Frequently Asked Questions
Yes, you can make money by lending cryptocurrency to potential users and charging interest.
Bitcoin is a component of DeFi; users can pay each other with Bitcoin, along with any other cryptocurrencies by using DeFi technology.
Ethereum is also a component of DeFi.It allows for trusted, peer-to-peer transactions to take place.
The largest part of this rule, the 50%, should be allocated to your monthly fixed expenses, such as rent or mortgage payments and bills. The 30% — and this is the fun part — should be your personal money, where you can spend it on what you wish. The remaining 20% should go towards your financial goals.