Get to know the building blocks of a new economy
The promise of decentralized finance (DeFi for those up on their financial lingo) as a disruptor to financial institutions makes it must-know for anyone involved in finance. DeFi For Dummies provides an easy-to-understand option for unraveling the past, present, and future of DeFi. Understand current DeFi applications, including how to build basic applications on the leading platforms, and get a look into the future’s most promising new DeFi solutions. Staying ahead of the game is critical for finance professionals these days, and this Dummies guide makes it possible, with full coverage of how DeFi affects asset management, lending and borrowing, and investment markets. Wrap your mind around DeFi and start getting hands on, the Dummies way.
Learn how the DeFi revolution started and where it’s going Get insight into opportunities for getting started and building value with DeFi Discover the leading assets, exchanges, and marketplaces built on DeFi principles Create secure DeFi applications on established platforms
This book is great for current pros or active investors in the world of finance who need to get up to speed on the world of DeFi as quickly and clearly as possible.
By:
Seoyoung Kim (Santa Clara University)
Imprint: For Dummies
Country of Publication: United States
Dimensions:
Height: 221mm,
Width: 150mm,
Spine: 23mm
Weight: 340g
ISBN: 9781119906803
ISBN 10: 1119906806
Pages: 336
Publication Date: 09 December 2022
Audience:
General/trade
,
ELT Advanced
Format: Paperback
Publisher's Status: Active
Introduction 1 About This Book 1 Foolish Assumptions 2 Icons Used in This Book 3 Beyond the Book 4 Where to Go from Here 4 Part 1: Getting Started With DEFI 5 Chapter 1: Introducing Decentralized Finance 7 Demystifying DeFi 8 From autonomous collectives to trillion-dollar DAOs 9 Transacting in DeFi versus CeFi 10 Dispelling harmful DeFi myths 11 Going Full Circle: The DeFi-CeFi Infinity Loop 12 Safeguarding wealth 12 Transferring funds 13 Continuing the cycle 13 Deciding to DeFi or Not to DeFi 14 Acknowledging inherent deficiencies in DeFi 14 Recognizing CeFi problems that migrate into DeFi 15 Identifying hurdles to adoption 16 Contemplating the Future of DeFi 17 The potential amazingness of seemingly unimportant applications 17 Can we completely replace CeFi? 18 Proceeding on Your DeFi Journey 19 Chapter 2: Discovering the DeFi Lingo 21 Introducing Key DeFi Terms 21 Moving into the Web3 era 22 Going the way of a DAO 22 Characterizing blockchains and consensus protocols 23 Describing cryptocurrencies and NFTs 23 Defining smart contracts and dApps 24 Getting acquainted with L1, L2, and the EVM 24 Grasping important metrics: Market cap, volume, and TVL 25 Knowing Important Distinctions 27 Custodial versus noncustodial 27 On-chain versus off-chain 28 Chapter 3: Dabbling in DeFi: Getting Your Hands Dirty 29 Setting Up Your Wallet 30 Unmasking MetaMask 30 Installing MetaMask 30 Setting up MetaMask 35 Renaming your account 39 Working with MetaMask on your mobile device 41 Funding Your Account 45 Getting (Real) ETH 46 Getting test ETH 47 Chapter 4: Making Your First DeFi Transactions 55 Decentralized Lending 56 Decentralized Borrowing 61 Executing a Trade on a Decentralized Exchange 63 Unwinding and Closing Out 70 Part 2: Diving Into The Burgeoning DEFI Space 75 Chapter 5: Decentralized Assets 77 Understanding Native Tokens 78 Exploring Non-Native Tokens 80 Stablecoins 81 Wrapped tokens 82 Governance tokens 82 Security tokens 83 Meme coins 83 Differentiating Non-Fungible Tokens (NFTs) 85 Chapter 6: Decentralized Exchanges and Marketplaces 87 Understanding Liquidity Providers and Order Books 88 Distinguishing between Custodial and Noncustodial Exchanges 92 Exploring DEXs 93 Decentralized order books 94 Automated market makers 95 Hybrid liquidity and aggregators 101 Navigating Marketplaces for Non-Fungible Goods 101 Chapter 7: Decentralized Lending and Borrowing 103 Making a Collateralized Loan 104 Understanding the Compound lending protocol 105 Revisiting DAI: A collateralized loan turned stablecoin 109 Using price feeds: What is the collateral worth? 111 Implementing a Flash Loan 112 A tale of two CEXs: Arbitraging without flash loans 112 A tale of two DEXs: Arbitraging with flash loans 114 Noting the caveats: The steep price of failure 115 Manipulating markets (the dark side of flash loans) 116 Chapter 8: Decentralized Metaverses 119 Introducing Decentralized Virtual Economies 120 Paving the way for real-world possibilities 120 Discovering decentralized metaverses 122 Experiencing Decentraland 123 Exploring the Metaverse 125 Part 3: Developing Your Own Dapp: A Step-By-Step Guide 129 Chapter 9: DeFi Building Blocks 131 Introducing Public Blockchains 132 Grasping the importance of a native token 135 Understanding key pairs and digital signatures 136 Touching on other types of distributed ledgers 142 Explaining Consensus Mechanisms 143 Proof of Work (PoW) 144 Proof of Stake (PoS) 146 Proof of XYZ 146 Following a Day (or a Second) in the Life of a Transaction 147 Determining transaction fees 148 Understanding transaction times 154 Tracing the journey of a transaction 158 Streamlining the Development Process 161 Leveraging smart-contract libraries 161 Oracles: A Blockchain’s Divine Access to the Outside World 162 Chapter 10: Smart-Contract Platforms 163 Diving into Layer 1: Comparing Base Protocols 164 Bitcoin 165 Ethereum 166 Ethereum Classic 168 Binance Smart Chain 170 Other EVM-Compatible Networks 171 TRON 172 Flow 173 Cardano 175 Solana 177 Floating Up to Layer 2: Off-Chain Scaling Solutions 178 State channels 179 Plasma chains and sidechains 180 Rollups 180 Fraud proofs versus validity proofs 181 Crossing Cross-Chain Bridges 182 Chapter 11: Launching a Smart Contract on Ethereum 183 Understanding Smart Contracts 184 The birth of a smart contract 184 Contract accounts versus “regular” (externally owned) accounts 185 Smart-contract languages 187 Anatomy of a smart contract 189 Multiple inheritance: Can you have three or more parents? 191 Launching Your Smart Contract 192 Using the Remix IDE 192 Entering your code 194 Compiling your code 199 Pre-launch preparations 200 Deploying your code 204 Accessing Your Smart Contract 209 Following your smart contract on a block explorer 209 Interacting with your smart contract 212 Allowing others to interact with your smart contract 220 Chapter 12: Launching a Smart Contract on the Binance Smart Chain 229 Testing the Waters: How to Navigate the BSC Testnet 230 Configuring MetaMask 230 Launching your smart contract 234 Accessing your smart contract 238 Feeling Ready for Mainnet? 247 Deploying onto Other EVM-Compatible Platforms 248 Avalanche 249 Polygon 250 Cronos 250 Fantom 251 Arbitrum 252 Huobi ECO (HECO) 253 Celo 253 Chapter 13: Launching Your First DeFi Product 255 Proving Your Proof of Concept 256 Identifying the market pain 257 Assessing the competition 257 Solidifying the value proposition 258 Preparing Your Development Stack 258 Setting up necessary accounts 259 Setting up necessary IDEs 263 Implementing the Back End of Your DApp 263 Entering your code 263 Deploying your Crowdfund contract 269 Following your Crowdfund contract 272 Funding Crowdfund 274 Verifying your Crowdfund contract 280 Creating the Front-End User Interface 287 Integrating the friendlier front end with the (less friendly) back end 288 Nurturing your dApp 294 Part 4: The Part Of Tens 297 Chapter 14: Top Ten DeFi Applications 299 Instadapp (INST) 300 Compound (COMP) 301 PancakeSwap (CAKE) 301 JustLend (JST) 301 Convex Finance (CVX) 302 Curve (CRV) 302 Uniswap (UNI) 303 Aave (AAVE) 303 Lido (LDO) 304 Maker (MKR) 304 Chapter 15: Top Ten Smart-Contract Platforms 305 Optimism (OP) 306 Arbitrum (N/A) 307 Fantom (FTM) 307 Cronos (CRO) 308 Polygon (MATIC) 308 Solana (SOL) 309 Avalanche (AVAX) 309 TRON (TRON) 310 Binance Smart Chain (BNB) 310 Ethereum (ETH) 311 Index 313
Seoyoung Kim, PhD, is an Associate Professor of Finance and Business Analytics at Santa Clara University and bestselling co-author of NFTs For Dummies. Seoyoung’s expertise lies in innovative financial instruments, crypto-assets, and blockchain-based ventures, on which she has consulted and written extensively. She regularly gives workshops and talks to academic, legal, and financial institutions, both domestically and internationally.
