# DeFi

*Crypto & Digital Assets — Finicade finance glossary*

DeFi rebuilds financial services — lending, trading, derivatives, insurance — as open smart contracts anyone can use without permission. Its genuine advantages are composability and transparency: protocols plug into each other, and every position is publicly auditable. Its genuine hazards are code exploits, oracle manipulation and cascading liquidations, which have destroyed billions with no deposit insurance behind them.

**Also known as:** decentralized finance, decentralised finance

**Related terms:** [Smart Contract](https://finicade.com/glossary/smart-contract), [Lending Protocol](https://finicade.com/glossary/lending-protocol), [Decentralized Exchange (DEX)](https://finicade.com/glossary/decentralized-exchange), [Liquidity Pool](https://finicade.com/glossary/liquidity-pool), [Total Value Locked](https://finicade.com/glossary/total-value-locked)

Source: https://finicade.com/glossary/defi