With the emergence of a number of financial instruments using cryptocurrency, the realm of DeFi is expanding. In addition, the term C-Fi has also emerged. And the difference between ‘DeFi’ and ‘C-Fi’ (crypto-finance) needs to be distinguished.
The word C-Fi comes from the recent popularity of DeFi. It sounds like slang, but it has nothing to do with slang. If the term DeFi is a coined term for de-centralized finance, then C-Fi is a term that refers to encrypted money financing. Financial instruments through cryptocurrency is the Crypto-Finance.
DeFi refers to decentralized financing and decentralized financing act is pretty common. So all financial instruments that use cryptocurrency are often also DeFi. However, this is totally different in character and should be seen separately. Because not all C-Fis are DeFis.
How DeFi is Crypto-Finance but not vice versa
As mentioned earlier, DeFi refers to decentralized finance. Decentralized financing refers to a financial service designed with blockchain technology that has no middle manager at all. As designed with blockchain technology, all transactions are recorded on the blockchain. All records are accessible at any time. In addition, because it is an automated form due to smart contacts, individuals get all rights to asset management. Of course, there are no KYC, as there are no centralized institutions.
On the other hand, C-Fi refers to all financial products that use cryptocurrency. In a large sense, the DeFi belong to the C-Fi in that it is a financial institution that uses cryptocurrency. The recent stocking service offered by the bourse is not a DeFi, but the C-Fi. Because centralized institutions (exchange exchanges) release financial instruments through cryptocurrency, they are not DeFi without any middle managers, but because they are cryptocurrency financial instruments. Similarly, landing services using cryptocurrency are also part of the C-Fi, but most of them do not belong to the De-Fi.
