Getting Started with Crypto in 2021 — #5

De-Mystifying DeFi

Use crypto to take full ownership of your finances with no banks or other middlemen needed.

After you’ve invested in some crypto fuel/infrastructure coins like $SOL, $LUNA, or $MATIC, the next step in your crypto journey is to make these assets work for you with Decentralized Finance, colloquially known as DeFi. This is where things start to get a little more challenging, but come along with me and you will make it through.

DeFi is an umbrella term for any application that applies blockchain technology to financial services like savings/lending (banking), money markets, stock trading, insurance, and more. There are also several crypto-specific DeFi project categories that do not exist in the traditional financial services world but nonetheless are considered part of DeFi: yield farming, decentralized exchanges, and launchpads.

Now I just threw a ton of terms at you, but don’t worry about the specifics of those terms — we’ll cover some of them in more detail in this story and the rest in future stories. The main thing you need to know is that DeFi is a movement that is creating the financial building blocks that you would need to manage your financial life entirely on the blockchain, with no banks, investment…