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Foundations: Defi

What Is MEV Protection?MEV protection exists because in open blockchains, simply revealing a trade can change its outcome

What Is MEV Protection?MEV protection exists because in open blockchains, simply revealing a trade can change its outcome. By hiding, restructuring, or auctioning transaction order flow, these systems aim to stop harmful extraction like frontrunning and sandwich attacks — or at least return some of that value to the user.Mar 21, 202625 min read

What Is a Decentralized Exchange Aggregator?A decentralized exchange aggregator exists because DeFi liquidity is scattered

What Is a Decentralized Exchange Aggregator?A decentralized exchange aggregator exists because DeFi liquidity is scattered. Instead of asking a trader to manually compare many pools, the aggregator searches across venues, often splitting a trade across several routes, to improve the final result after price impact and gas.Mar 21, 202623 min read

What is Synthetic Assets?Synthetic assets let blockchains represent exposure to things they cannot natively hold: dollars, stocks, commodities, indexes, even custom payoff functions

What is Synthetic Assets?Synthetic assets let blockchains represent exposure to things they cannot natively hold: dollars, stocks, commodities, indexes, even custom payoff functions. The idea is powerful because it separates *price exposure* from *ownership* — but that separation makes collateral, oracles, and liquidations the real machinery that matters.Mar 21, 202624 min read

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What is Rehypothecation?Rehypothecation sounds like a niche market-plumbing term, but it points to a basic question: when you post collateral, who can use it next? In both traditional finance and DeFi, the answer shapes liquidity, leverage, and how quickly stress can spread

What is Rehypothecation?Rehypothecation sounds like a niche market-plumbing term, but it points to a basic question: when you post collateral, who can use it next? In both traditional finance and DeFi, the answer shapes liquidity, leverage, and how quickly stress can spread.Mar 21, 202623 min read

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What is Liquidation Threshold?A liquidation threshold is the line between a healthy DeFi loan and one the protocol is allowed to unwind

What is Liquidation Threshold?A liquidation threshold is the line between a healthy DeFi loan and one the protocol is allowed to unwind. It looks like a simple percentage, but it sits at the center of lending risk, linking collateral prices, borrowing power, liquidator incentives, and oracle design.Mar 21, 202624 min read

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What is Overcollateralization?Overcollateralization is one of DeFi’s simplest ideas and one of its most important: you must lock up more value than you borrow

What is Overcollateralization?Overcollateralization is one of DeFi’s simplest ideas and one of its most important: you must lock up more value than you borrow. That extra buffer is what lets lending protocols and crypto-backed stablecoins function without knowing or trusting the borrower.Mar 21, 202623 min read

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What Is an Interest Rate Model?An interest rate model is the pricing engine inside a DeFi lending market

What Is an Interest Rate Model?An interest rate model is the pricing engine inside a DeFi lending market. It turns a pool’s current imbalance between idle liquidity and active borrowing into borrow costs, lender yield, and often protocol reserves — and small design choices in that engine can change a market’s behavior dramatically.Mar 21, 202627 min read

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What Is DeFi Lending?DeFi lending turns idle crypto assets into pooled credit markets that run in smart contracts

What Is DeFi Lending?DeFi lending turns idle crypto assets into pooled credit markets that run in smart contracts. The striking part is not just that people can borrow without a bank, but that the whole system works by replacing human credit judgment with collateral rules, price feeds, and automatic liquidation.Mar 21, 202626 min read

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What Is Collateral in DeFi?Collateral is the answer to DeFi’s hardest lending problem: how do you lend to strangers with no legal contract and no credit check? By locking assets on-chain and enforcing rules in code, protocols can create loans and stablecoins that are backed, measurable, and liquidatable—but only if prices, incentives, and infrastructure keep working

What Is Collateral in DeFi?Collateral is the answer to DeFi’s hardest lending problem: how do you lend to strangers with no legal contract and no credit check? By locking assets on-chain and enforcing rules in code, protocols can create loans and stablecoins that are backed, measurable, and liquidatable—but only if prices, incentives, and infrastructure keep working.Mar 21, 202627 min read

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What Is Collateral Ratio?Collateral ratio is the number that tells a lending protocol whether a loan is still safely backed

What Is Collateral Ratio?Collateral ratio is the number that tells a lending protocol whether a loan is still safely backed. In DeFi, that simple ratio governs how much you can borrow, when liquidation starts, and whether a system stays solvent during fast market moves.Mar 21, 202622 min read

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What is a Collateralized Debt Position?A collateralized debt position lets you lock crypto and mint debt against it without handing assets to a lender

What is a Collateralized Debt Position?A collateralized debt position lets you lock crypto and mint debt against it without handing assets to a lender. That simple idea powers some of DeFi’s most important stablecoins — but it only works because liquidation, pricing, and risk limits are designed to react before the collateral buffer disappears.Mar 21, 202624 min read

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What is Bonding in DeFi?Bonding in DeFi is a way for a protocol to buy assets or liquidity directly from users instead of competing for them on the open market

What is Bonding in DeFi?Bonding in DeFi is a way for a protocol to buy assets or liquidity directly from users instead of competing for them on the open market. That small shift changes who owns the liquidity, how treasuries grow, and where the risks move.Mar 21, 202624 min read