DeFi, or Decentralized Finance, is a financial ecosystem built on blockchain technology that operates without the need for traditional intermediaries like banks. Unlike the centralized financial systems, where intermediaries control access and facilitate transactions, DeFi operates on a peer-to-peer basis, using smart contracts to automate and execute transactions.Smart contracts are self-executing contracts stored on the blockchain. They are used to automate and execute financial transactions without the need for human intervention. Much like the vending machine that will only dispense your desired product after all requirements are met. If you don't select a product or insert enough money, the vending machine won't give out your product.