Decentralized finance (DeFi) refers to a financial ecosystem built on blockchain technology that allows users to engage in transactions without traditional intermediaries like banks. DeFi platforms offer services such as lending, borrowing, and trading through smart contracts, providing users with greater control over their assets.

The rapid growth of DeFi has attracted significant investment, with the total value locked in DeFi protocols exceeding $100 billion in recent years. However, the sector also faces challenges, including regulatory scrutiny and security vulnerabilities.

As DeFi continues to evolve, it is likely to reshape the financial landscape, providing greater access to financial services for underserved populations. The integration of traditional finance with DeFi could lead to new opportunities and innovations, making it a space to watch closely.