Is DeFi safe?

Asked 2 years ago

Hello, before investing I just want to know how immune DeFi is to hackers and fraud? Is it safer than other cryptocurrencies?

Pedro Hopkins

Wednesday, February 02, 2022

Try not to confuse DeFi with cryptocurrencies, as cryptocurrency is a broader term used to talk about assets of value issued by platforms which could be DeFi or other blockchain-based platforms.

There is no investment that is 100% safe and the success or failure of an investor will depend on the information at their disposal and their ability to learn and apply unsentimental risk management in their investment decisions. Investing in DeFi is similar to investing in the stock market as a daytrader, although you may not be liquidated unless to go into the more complex areas of DeFi which includes high-risk derivatives.

Your investment strategy can simply be stablecoins that attract the lowest risk but offer a fixed return or potentially 1,000x coins that could rug-pull or crash in a wink. So the risks involved are mostly hinged on your appetite and decisions as an investor.

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