How Does DeFi Lending and Borrowing Work?

[CryptoWarriorsssss]

Couples of my friends did borrowBTC from some lending platforms (AAVE or Compound)



Refer to the CMC today's price $COMP at $231. and $AAVE at $192.63



I also  read the latest news on LABS Group which just reached a partnership with a new Lending platform -DeCredit


???so curious about 'How Does DeFi Lending and Borrowing Work?'

no doubt, I  know DeFis is the key element of Crypto 🚀🚀

[Revvo1]

Defi lending and borrowing platforms such as Compound or Aave are fine for depositing your assets. However, you should take in account that DeFi is still developing and so take a good look into their models.The New projects developing projects of defi are making good models and lending products for adopters like decredit which is  the world's first end to end real estate digital ecosystem, is reshaping real estate investment by segmenting investment, mortgage, and secondary markets through a regulated real estate stock exchange. 70%.Where the risk factor is very low for adopters.

[Eddie kan]

Things change quickly in the crypto space, and decentralized finance (DeFi) is a current trend — it's an exciting space to be, undoubtedly. DeCredit partnering with DeFi shows the huge advancement in the lending world!

[Sunnery 01]

 About the workability of DeFi Lending and Borrowing, I might not know it all but I think a lender can loan their assets to others and will be able to generate interests on that loan. This process can be done through lending pools, the loan offices of traditional banks. I wish I could explain better.

[passwordnow]

You search for those articles that has been explaining how these defi's work. Just like this article below that's searchable through Google.
Decentralized Finance (DeFi) Definition

[passwordnow]

You search for those articles that has been explaining how these defi's work. Just like this article below that's searchable through Google.
Decentralized Finance (DeFi) Definition

Thanks ， I will take a research

You're welcome. Google is your friend, my friend. And if there are jargon words or definitions that you can't understand. Just come back on this thread and ask again and some of the experts on the forum that deals with DeFis, once they see your question.
They'll be the ones to answer you personally and they're going to have their time giving you an explanation about what you still don't understand about it.

[MusaMohamed]

[Tutorial] Decentralized Finance (DeFi) for Noobs
Get the list of lending, borrowing there https://defiprime.com/decentralized-lending

It is worth to remind you about risk. When you make lending, you have to read terms of collateral and liquidation. Be careful with liquidation.

[TastyChillySauce00]

Defi lending is just allowing you to borrow while your assed gonna be used as a collateral, it's just the same as lending in real world, except it's done automatically with code instead of needing human intervention.
But what blows my mind is the flash loan, which essentially allowing someone to borrow millions of dollar without collateral, to literally anyone, but there's special requirement why that could be done and why that's not gonna make the platform goes bankrupt.

[MusaMohamed]

Defi lending is just allowing you to borrow while your assed gonna be used as a collateral, it's just the same as lending in real world, except it's done automatically with code instead of needing human intervention.
But what blows my mind is the flash loan, which essentially allowing someone to borrow millions of dollar without collateral, to literally anyone, but there's special requirement why that could be done and why that's not gonna make the platform goes bankrupt.

DeFi allows people to make loan with smart contracts and decentralized. They don't have to join centralized exchanges and lock their coins as collateral to loan.

The most attractive things with DeFi is decentralization but liquidation is a kind of risk for any loan. If your collateral value drops to liquidation threshold, your loan will be closed and collateral will be taken as part of liquidation.

Loan is never the best choice if you I have money, use it, and don't consider loan as the only way to get rich.