# DeFi Demystified for NFT Degens By [FastYak](https://paragraph.com/@fastyak) · 2022-04-11 --- Welcome to our new blog series where we break down the basics of decentralized finance for NFT degens looking to dip their toes into the shallow end of the liquidity pool. This is the written version of our Twitter Spaces with Jason Hitchcock which you can watch back on YouTube here. At the end of the show we asked for your feedback on twitter to see if the session was valuable and if it’s something you would like to see more of in future. The feedback was overwhelmingly positive so Jason will be back with us in a few weeks time for Session 2! In the meantime, we have broken the session into 3 sections which we will deliver over the next three weeks: In part 1 we will cover how to get started in DeFi and answer beginners questions like — “What is yield and how do I earn it?”, “What is staking?”, “What are the risks to DeFi?” and “WTF is APY and how do I calculate it?”. How do DeFi loans differ from TradFi loans and why would you want to take out a DeFi loan in the first place? In our second part of this session we will answer these questions and explore some dApps that offer loans against your ETH. “What are stable coins and why do we need them?” Part 3 will break down the 3 different types of stable coins out there (fiat-backed, over-collateralized, and algorithmic), and why you would you want to hold them. At the end of each week we will set a piece of homework — anything from a research topic, comparing dApps, or assessing risk. This week’s homework is simple: Set a goal. Before you jump into the world of DeFi you should set a goal for yourself — what do you want to accomplish with DeFi, and what does the end state look like? Moreover, when is the end state? Are you looking to 10x your investment in 2 years and then exchange it all back into fiat to buy a house? Or would you prefer earning a compounding yield over a longer time period with the steadfast belief that we’re early. Another aspect to consider is risk. All investments are inherently risky —do you want to YOLO into high risk coins or diversify your portfolio opting for a smaller return and thus lower risk? Let us know on twitter and on discord what your goals are with DeFi and join us next week for Part 1: Getting started in DeFi. Follow BigHeadHQ | Follow Jason | Join our Discord Disclaimer: The above article is presented for educational and entertainment purposes only. None of the content constitutes financial or investment advice. --- *Originally published on [FastYak](https://paragraph.com/@fastyak/defi-demystified-for-nft-degens)*