# What is DEFED and how does it work? By [DEFED](https://paragraph.com/@defedcommunity) ยท 2022-09-28 --- DEFED-A Web3.0 Super Account ---------------------------- Defed is a super account system with the following features: decentralized, community-governed, smart contract-based, no threshold, and support for any group, anywhere, at any time, worldwide, truly free account opening, free account access, high efficiency, and low fees. Defed accounts have all the functions of deposit, loan and payment that an account should have. Users can deposit assets into their Defed account and earn interest, or they can use their account balance as collateral in real time to obtain a line of credit, which can be used for any scenario, just like the original Coin/Token assets. ### DEFED- An Extension Wallet DEFED is not only an account that supports deposit, borrow and transfer, but also serves as an extension wallet. It's a non-custodial, hot wallet, allowing users to have full control of private keys and assets on the blockchain, and can make connections with the internet directly. The DEFED wallet is similar to Metamask, but there are some optimizations. The most distinctive feature that sets DEFED Wallet apart from other wallet plugins is that your assets, when they are staying at DEFED, will automatically generate interest income, and will no longer be wasted. With DEFED, your money never sleeps. Your assets are linked to multiple dapp services through a decentralized credential for asset locking to help you earn income. ![](https://storage.googleapis.com/papyrus_images/d2abde6af1fa3d81741ff6b8e70c3385b8cfeff1494025b39d99bf3c6ede6c43.png) How does DEFED work? -------------------- DEFED is like your Web3.0 bank. You can deposit, withdraw or transfer your assets on DEFED, and of course, you can also borrow from the bank. In addition, DEFED even allows users to initiate transactions directly into a chat conversation. ![](https://storage.googleapis.com/papyrus_images/22d103d1124534f7e7ce3a748491e8b210ea3c577f7e9f146ae900d3f80c664b.png) ### Deposit DEFED will create a Vault in Layer1 to guide users to deposit their assets into it to ensure asset security; at the same time, DEFED will map users' assets to Layer2 to achieve flexible and low cost payments; users can either pay with balance of DEFED Earing Account or use it as Collateral and pay with DToken; users can either pay with the credit granted by DEFED to avoid having to sell their positions due to sudden payment needs. ![](https://storage.googleapis.com/papyrus_images/4ef88025bae8d51073346bf847f8584e17a766f64d54eeb2e9d32d2b5373c3c8.png) ### Transfer Transferring funds is one of the basic functions of DEFED. By using DEFED, you can not only transfer by Savings Account Balance, but also by Credit Account Balance, as well as the target as Ether Address or Defed Account Balance. DEFED offers a low-cost and efficient way to pay, no matter how big your payment is, you only need to pay a small fee (about 0.0001 ETH). For the same request, if you pay in the usual way, you need to spend about 0.00148, cost about 15 times more than paying in DEFED. With security guaranteed, DEFED uses the more efficient Layer2 with the block-out interval of 2.1 seconds to increase the transaction efficiency by about 500% compared with transaction on layer 1. ![](https://storage.googleapis.com/papyrus_images/8c6e03241c2420cc753df6bf691ad08943d9d1874b2ec7c1d8b6c1359ca1b3c9.png) ### Borrow DEFED supports instant lending and repayments. With this function, you can borrow and repay ETH, WBTC, USDC at anytime. DEFED's Borrow and Repay are both based on a peer-to-pool lending protocol. All borrowing and repayments interact directly with the lending pool, powered by smart contracts, so there is no waiting and no matching time. Instant over-collateralized lending allows users to borrow the assets they need at anytime. At the same time, interest will accrue based on the blocks, and users can also repay their borrowings at any time. ![](https://storage.googleapis.com/papyrus_images/061555002f2e30b7c0171f9681583d672e3f1338231daaf6bd2d3eea8b92a478.png) ### Message Unlike traditional banks, DEFED allows you to chat encrypted on the blockchain, you only need to enter the other person's Ethereum address to initiate a chat freely, and your chat is encrypted. In addition, you can even transfer to others while chatting. Encrypted chats and transfers on the blockchain, which will provide solutions for many practical application scenarios. In this way, the identity of the counterparty can be confirmed directly through communication, and then the transaction can be initiated, eliminating loss and additional costs. ![](https://storage.googleapis.com/papyrus_images/99bbac596167a523074833255ae25babbe3e6ddfb9875bdc0b784e0879f62e2e.png) --- *Originally published on [DEFED](https://paragraph.com/@defedcommunity/what-is-defed-and-how-does-it-work)*