How synthetic assets are changing DeFi

While Bitcoin is a decentralized digital currency that runs on its own blockchain and is primarily utilized as a store of value, DeFi refers to financial services built on public blockchains like Bitcoin and Ethereum.

What Exactly is Defi?
Decentralized finance (DeFi) is a new financial system based on distributed ledgers that are similar to those used by cryptocurrencies. Money, financial products, and financial services are no longer under the jurisdiction of banks and institutions.

According to Wkipedia:
“Decentralized finance (DeFi) offers financial instruments without relying on intermediaries such as brokerages, exchanges, or banks by using smart contracts on a blockchain.”

What are synthetic Assets ?
A synthetic asset is nothing more than a tokenized derivative that imitates the value of another asset.

Consider trading DEFI stocks without owning the $defi asset. You can trade $sdefi (synthetic Defi) instead, which mimics the actual asset by employing data oracles like Chainlink to watch its price.

Crypto synthetic assets have a number of advantages over conventional derivatives.
They can be produced by anyone: Using open-source protocols like Synthetix and Mirror, anyone can create synthetic assets based on the blockchain.
Unrestricted Transfers:Synthetic assets, such as ERC-20 tokens, are blockchain assets that may be sent and received between normal cryptocurrency wallets.
Global liquidity: Synthetics can be exchanged on any crypto exchange in the world, including unstoppable decentralized platforms, with global liquidity.
Frictionless movement: Without needing to keep the underlying asset, you can switch between equities, synthetic silver/gold, and other assets.