Of all of the disruptive possible uses of blockchain, decentralized finance (or DeFi) might be the one most likely to bring this technology to a wide audience — and challenge the established finance industry in the process. By using self-executing contracts on newly formed marketplaces, DeFi allows users to stand in place of large institutions to loan and borrow money to each other, and to earn interest and fees by doing so. DeFi offers new opportunities to make money, such as “yield farming,” which often resemble traditional finance strategies. But it also offers a large-scale update to the basic plumbing of financial markets such as NASDAQ and the NYSE, offering more efficiency, transparency, and trust. There is significant risk inherent these crypto markets, but DeFi offers a less volatile and more accessible point of entry than other markets — and may just have enough appeal to bring blockchain into the mainstream.

Decent article on lending bitcoin, altcoins, or stablecoins out. The conclusion at the bottom is the money shot:

“At the end of the day, DeFi is still a far more dangerous spot to park your money with risks not well-understood by the average investor. All DeFi protocols run the risk of software bugs and/or copycats that can, in the worst case, drain liquidity completely. In addition, there is obviously no FDIC insurance protecting the deposits.”