> ## Documentation Index
> Fetch the complete documentation index at: https://docs.theblockchainlibrary.com/llms.txt
> Use this file to discover all available pages before exploring further.

# DeFi fundamentals

> Understand decentralized exchanges, lending, liquidity, and programmable finance.

## What is DeFi?

Decentralized finance describes financial applications implemented through blockchain-based protocols and smart contracts.

## Common categories

* Decentralized exchanges.
* Lending and borrowing.
* Stablecoins.
* Liquidity pools.
* Derivatives.
* Yield and staking-related systems.

## Risks

DeFi can involve smart-contract risk, oracle risk, liquidity risk, governance risk, stablecoin risk, liquidation risk, and user-interface attacks.

<Warning>High advertised yields can reflect high risk, temporary incentives, or unsustainable token emissions.</Warning>