DeFi is decentralized finance that relies on blockchain technology rather than central financial institutions. It provides financial instruments like lending and exchanges through decentralized applications. Popular examples include MakerDAO, which has a stablecoin pegged to the US dollar, and Uniswap, which is an automated market-making exchange. Other innovations in DeFi include NFTs, which are unique digital assets representing items like art, and distributed autonomous organizations that allow protocols to be governed by token holders. While many current DeFi projects may not last, the core ideas of decentralization and blockchain technology underlying DeFi are likely to persist.

1. May 2021
Decentralized
Finance (DeFi) 101
1

2. Outline
Slide Topic
3-9 What is DeFi?
10-15 DeFi Examples
16-20 Other Innovations
21-26 Resources
27 Conclusion
28 Questions?
2

3. What is DeFi?
3

4. Evolution of the Internet
4

5. DeFi Timeline
Bitcoin kicked off the idea of decentralization in finance but
Ethereum really made it happen with smart contracts.
5

6. What is Decentralized Finance (DeFi)?
DeFi is a form of finance that does
not rely on central financial
intermediaries such as
brokerages, exchanges, or banks
to offer traditional financial
instruments.
Instead it relies on a decentralized
platform using distributed ledger
technology called the blockchain.
6

7. The Blockchain
7

8. Traditional vs DeFi
8

9. The Layers of DeFi
9

10. DeFi Examples
10

11. Real World DeFi Products
11

12. MakerDAO - https://makerdao.com/
● MakerDAO has a stablecoin called DAI that is pegged to the
US Dollar
● MakerDAO wants to be a decentralized reserve bank
12

13. Uniswap - https://uniswap.org/
● Uniswap is a distributed
exchange (DEX) that provides
an automated market making
function
● You would use this exchange if
you wanted to switch from one
token to another
● In a traditional exchange you
would have a single institution
that provides liquidity using an
order book to match buyers and
sellers
Traditional Order Book 13

14. Uniswap
● Anyone can participate as a liquidity provider and get compensated
● Uniswap charges 0.30% to swap between tokens and the full 0.30% goes to the liquidity
provider (LP)
● In the future, 0.25% will go to the LP and 0.05% will go to the Uniswap Governance, which is
a Distributed Autonomous Organization (DAO)
14

15. Compound - https://compound.finance/
● Compound is a lending and borrowing platform
● If you have tokens in your cryptocurrency wallet, you can lend them to
others and earn interest on them
15

16. Other Innovations
16

17. How is a JPEG worth $69 million?
17
“Everydays: The First 5000 Days”
by Beeple

18. What is an NFT?
● Fungible means something
can be interchanged, such as
a one bitcoin can be swapped
with another bitcoin
● A non-fungible token (NFT) is
simply a unique digital asset
● NFTs use the same
technologies as DeFi -
blockchain and
cryptocurrencies
● NBA Top Shot is an example
of an NFT platform
18
https://nbatopshot.com/

19. CryptoPunks - https://www.larvalabs.com/cryptopunks
● CryptoPunks is an NFT art project that
was released in June 2017
● They are 24x24 pixel art images,
generated algorithmically
● There are only 10,000 unique
CryptoPunks assets
CryptoPunk #7804
sold for $7.5 million in
March 2021
19

20. Distributed Autonomous Organization (DAO)
● In DeFi even the management is
distributed using something
called a Distributed Autonomous
Organization (DAO)
● For example, Uniswap is
technically a protocol and
changes to the protocol need to
be voted by the DAO
● In Uniswap you receive tokens
when you provide liquidity and
those tokens are like votes
Uniswap UNI token https://etherscan.io/token/0x1f9840a85d5aF5bf1D1762F925BDADdC4201F984 20

21. Resources
21

22. Decrypt - https://decrypt.co/
● News on Bitcoin, Ethereum and DeFi
22

23. CoinMarketCap - https://coinmarketcap.com/
● Real-time cryptocurrency prices and other DeFi related products
23

24. DeFi Pulse - https://defipulse.com/
● Tracks the biggest Decentralized Apps (Dapps)
24

25. DappRadar - https://dappradar.com/
● Another website that tracks DeFi Dapps
25

26. Modern Finance Podcast - https://www.modern.finance/
● The Modern Finance
(MoFi) podcast covers all
things cryptocurrency,
DeFi, yield farming, NFTs,
robo-investing, finance
hacks, and more
● It’s hosted by Kevin Rose
who has been around
technology since the
2000s
26

27. Conclusion
27
● The current hype around
Bitcoin, Ethereum and NFTs
is very similar to the dotcom
bubble
● Many companies and ideas
will not survive but the core
technology and
decentralization thought
process is here to stay

28. Questions?
https://celestri.org
mrjain@gmail.com
v1.5
28