DeFi simply means decentralised finance. It doesn't rely on any banks or Central institutions for money, insted it utilizes smart contacts blockchains, usually many DApps are built on Etherium . DApps are the applications in which the users can lend, stake, swap, provide liquidity to the tokens. Loans are also given out at reasonable intrest rates or by providing a collateral like some crypto or something.
These are like the backbone of DeFi space, these are the applications which allows you to communicate with the blockchain.
Supposedly the first Defi system which gained huge traction. It's based on Ethereum blockchain. It issues Dai stablecoin which is pegged to Us dollar. It lends out Dai to users in exchange to other coins. We can also lock coins for a certain period for high Apy (annual yeild).DAI can be used over 400 platforms related to crypto currency. There's a lot of nft drops going on DAO now.
Uniswap was founded in late 2018, it's based on Ethereum blockchain mainly used for swapping tokens in the platform. We can also provide liquidity to the pool. The UI of the platform is very user friendly. They also launched a token of the same name as the app. Uniswap is becoming somewhat less relevant due to the high ETH gas fees. Also providing liquidity in the V3 version is not very user friendly.
PancakeSwap is like updated version on uniswap, built on Binance chain which is way faster and cheaper than Ethereum blockchain which was mainly used for building DeFi apps. PancakeSwap is very fast than uniswap and the fee is affordable for an average Joe. I like the way PancakeSwap is evolving into a ecosystem . It has all basic features of a DeFi apps plus some games and NFTs. The UI is user friendly. The PancakeSwap token is also a good investment.
I know that MakerDAO is giant of DeFi system , it's smart contacts like Compound and Synthetix which have become their own ecosystem. I will be covering them in detail in Part 2 or 3. Also AAVE , Yearn finance, Sushi swap, Venus, Beefy will be covered. Tipping would be generous. Feel free to ask any questions.