#TradeFiRevolution
What is TradeFi (Traditional Finance)?
TradeFi (short for Traditional Finance) refers to the traditional financial system, including banks, investment funds, stock markets and other financial institutions. This is a long-standing financial ecosystem, with strict regulations from governments and regulators.
Main features of TradeFi:
- Strict regulations: Comply with financial laws issued by governments and organizations such as SEC, FED, or ECB.
- Financial intermediaries: Transactions are usually made through banks, stock exchanges or investment funds.
- Transparency and stability: The system is controlled to ensure stability and safety for investors.
- Traditional assets: Including stocks, bonds, commodities, real estate, etc.
Compare TradeFi and DeFi (Decentralized Finance):
| Factors | TradeFi | DeFi |
|---------|---------|------|
| Intermediary | Yes (Bank, exchange) | No (Smart contract) |
| Regulation | Strict | Little or no |
| Transparent | Controlled by financial institutions | Public on blockchain |
| Transaction speed | Slow (depends on bank, business days) | Fast, 24/7 |
| Risk | More stable, less volatile | Higher due to lack of strict regulation |
Conclusion:
TradeFi is still a mainstream financial system, playing an important role in the global economy. However, DeFi is gradually changing the landscape with innovation and decentralization. Investors can combine both to optimize profits and manage risks.