DeFi & Web3: A Beginner’s Guide in Easy Words

💡 What Is Decentralized Finance (DeFi)?

Decentralized Finance, commonly called DeFi, refers to financial systems built on blockchain technology that let people send, receive, borrow, or lend money directly — without traditional middlemen like banks or brokers. In DeFi, transactions happen peer-to-peer and are governed by programmed contracts (smart contracts) instead of central authorities. Investopedia+1

✅ Key Points (Simple):

• DeFi lets you control your own money directly. OVHcloud
• Transactions are handled automatically by code on a blockchain. Investopedia
• No central bank or financial institution is in the middle. Investopedia

What Is Web3?

Web3 is an idea for the next generation of the internet where control is decentralized — meaning you own your data, identity, and digital assets rather than big tech companies. It uses blockchain technology so apps run on networks of computers, not a single company. Amazon Web Services, Inc.+1
🧠Core Ideas (Simple):

• Web3 is a decentralized internet that lets users interact directly with each other. Amazon Web Services, Inc.
• It uses blockchain to secure and record actions without a central boss. Wikipedia
• DeFi is one of the most important financial pieces of Web3. Endless Domains

⭐ Why These Matter

Together, DeFi and Web3 aim to give more control, privacy, and freedom to users instead of centralized companies or institutions. They are building blocks of a future internet designed to be trustless (no single authority), peer-to-peer, and transparent. Amazon Web Services, Inc.

⚠️ Disclaimer

This article is intended for educational and informational purposes only. It does not constitute financial, investment, or legal advice. Always do your own research or consult a qualified professional before making financial decisions.