Decentralized Finance (DeFi) enables peer-to-peer (P2P) financial services without centralized 3rd-party intermediaries. At Bitgo, you can participate in DeFi by creating smart contracts on Ethereum-based wallets.

When you set up smart contracts, you dictate the conditions that allow for certain financial transactions (such as borrowing, lending, or trading) to automatically occur. Smart contracts verify transaction conditions on their blockchain. When the consensus mechanism verifies that the conditions are met, the transaction proceeds.

For example, you can create a smart-contract wallet on Bitgo, that enables you to lend your cryptocurrency. Using a decentralized app (dApp), you and potential borrowers submit your smart contracts for a P2P loan. The dApp algorithmically finds potential matches. All transactions occur on the blockchain directly between you and the borrower.