About DeFi
DeFi, short for Decentralized Finance, is a new kind of financial system built on blockchain technology. Unlike traditional finance, there are no banks or brokers in the middle. Instead, everything runs through smart contracts — pieces of code that live on the blockchain and carry out financial transactions automatically.
With DeFi, anyone with a crypto wallet and internet connection can access services like lending, borrowing, trading, or earning interest. You don’t need a bank account, approval from an institution, or to live in a specific country. It’s open, global, and doesn’t require permission from anyone.
How it works in practice
Imagine depositing your digital dollars (stablecoins) into a DeFi platform. That money might be used by others who borrow it and pay interest, which you earn. Or you might provide tokens to a trading platform and earn a small fee every time someone makes a swap.
These models — like yield farming or automated market-making — often offer higher returns than traditional savings accounts or bonds. But here’s the challenge: those returns come with risk, and the usual tools used by banks to measure risk don’t work in DeFi. There’s no decades-long history or standard models. Risks are different, and harder to see.
That’s why DeFi can be risky, especially for newcomers. One bug in a smart contract, one design flaw in a token, or one attack on a protocol can lead to big losses. At Shift, we believe DeFi needs smarter tools to manage those risks — and that’s what we’ve built.
Why DeFi is worth paying attention to
Despite the risks, DeFi opens the door to powerful new opportunities:
Higher yields
DeFi protocols can offer much better returns than most traditional investments. That’s because they often include reward tokens or transaction fees. However, these high returns don’t always last long, so timing and strategy matter.
Big liquidity
DeFi is not a niche anymore. As of June 2025, there was over $110 billion worth of assets locked in DeFi protocols. That means the market is deep and active, with plenty of capital moving between platforms.
Open to everyone
You don’t need a bank, a credit check, or a certain passport to use DeFi. If you have a wallet and internet, you can invest. And because DeFi never sleeps, markets are open 24/7, allowing you to react quickly to changes or opportunities.
Lots of options
DeFi isn’t just one thing. You can lend, stake, farm, trade, or try complex strategies — and do it across different blockchains and protocols. This flexibility helps investors create portfolios that match their personal goals and risk levels.
Transparency and control
DeFi runs in the open. You can see exactly where your money is, inspect the code, and check what’s happening at any time. Some protocols even let you vote on decisions like fee changes or product updates, so you’re not just a passive user — you can have a say.
At Shift DeFi, we take transparency a step further. Every move we make (every risk assessment, portfolio adjustment, or vault rebalancing) is captured and open for review. Want to see how that works in practice? Read our article on The Transparency Paradox, and see how visibility becomes both a strength… and a vulnerability.
The bottom line
DeFi is one of the most exciting developments in modern finance. It offers more freedom, more access, and often better returns. But it also comes with higher risks and fewer protections.
That’s why platforms like Shift are needed — to make DeFi accessible without requiring users to be technical experts or expose themselves to unnecessary risks. We provide the tools, strategies, and safeguards that let users explore this new financial world with both confidence and control. In Shift, decentralization means your funds stay in your custody — you benefit from professional portfolio management without giving up ownership of your liquidity.
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