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DeFi Tokens

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What fundamental primitives make up the DeFi ecosystem?

DeFi is a term used to describe a variety of onchain applications that are geared toward disrupting traditional financial services.

Context​

Marketplace​

Primitive/InstrumentsInputEVMSVM
Bonds
LendingAAVEKamino
Derivatives - Futures
Derivatives - Options
Derivatives - Perpetuals
Derivatives - Swaps
Derivatives - Forwards
DEXs (AMM)
DEXs (Orderbook)
Flash Loans
Insurance
note

One or more primitives can be combined to create onchain DeFi service protocols

Analysis​

Purpose​

Transparent logic defines how transactions are processed while Off-chain services provide necessary data and triggers to apply those trading rules.

  • TradFi has transactions processed by a central authority governed by human processes.
  • DeFi automates the transaction settlement process with minimal human intervention.
  • DeFi logic is transparent, meaning everyone can see how a transaction will be processed.

DeFAI​

Autonomous AI Agents that maximise returns on other DeFi protocols by exploiting opportunities to profit through implementing specific strategies. These apps function by aggregating data across the entire ecosystem to form an executable strategy that maximises returns for the user.

Agent Profiles:

Strategies:

  • Maximal Extractable Value (MEV)
  • Governance Boost
  • Yield Vaults
  • DEX Aggregators

Optimisers are a set of applications which build on top of DeFi primitives in order to maximise returns through implementing specific strategies.

Benefits​

Some of the key attractions of DeFi for many consumers are:

  • Eliminates the fees that banks and other financial companies charge for using their services
  • Control your money in a secure digital wallet instead of needing a bank
  • Anyone with an internet connection can use it without needing approval
  • You can transfer funds in seconds and minutes

Concepts​

Components and concepts of the DeFi ecosystem:

  • Primitives: The building blocks of the DeFi ecosystem whereby each protocol offers a specific financial function.
  • Assets: The item/thing which is being traded, usually represented in the form of a token.
  • Cross-Chain Bridges: Protocols that enable assets to be securely moved across various chains.
  • Oracles: Data providers that enable DeFi protocols to ingest external data for logic processing within their smart contracts.
  • Transaction Settlement: The base layer for DeFi where all transactions are finalised and secured.
  • Wallets: Stores and manage the private keys of the user. These self-custodial wallets enable signing of transactions as well as user interaction with the DeFi protocols.

Toolkit​

Products that help you invest in DeFi.

Engineering​

How to build services onchain.

Follow​