Affiliation:
1. Christ University, India
2. Karpagam Academy of Higher Education, Coimbatore, India
Abstract
The rise of decentralized finance (DeFi) has fundamentally reshaped the financial industry, challenging traditional banking systems and opening up a world of possibilities in global finance. This chapter explores the multifaceted impact of DeFi on the global economic landscape, addressing critical themes through a series of subtitles. DeFi is disrupting traditional banking models by offering alternative financial services directly on blockchain networks, such as lending, borrowing, and trading. One of the remarkable achievements of DeFi is its ability to provide financial services to previously underserved and unbanked populations. Tokenization is a crucial aspect of DeFi, enabling the representation of real-world assets as digital tokens on the blockchain. DeFi offers numerous advantages but poses security challenges, including smart contract vulnerabilities and hacks. This chapter provides an overview of the major themes and implications of DeFi's influence on finance, highlighting its opportunities and challenges.