Becoming Web3 Native Pt 2: Learn by Doing — How to Use DeFi

This is Part 2 of our 8 part series on how you can use Web3 in your everyday life.

Part 2: Learn by Doing — How to Use DeFi

Tired of low-interest savings accounts, high bank fees, and slow money transfers? DeFi (Decentralized Finance) offers a new way to manage money that cuts out the middleman, giving you direct access to lending, borrowing, and earning better returns on your assets. Whether you want to earn passive income, swap tokens without a centralized exchange, or send money instantly across borders, DeFi is opening up financial tools that were once reserved for banks and big investors. In this section, we’ll cover what DeFi is, how it works, and the easiest ways to get started.

What is DeFi?

DeFi (Decentralized Finance) is a blockchain-powered financial system that removes the need for banks. Instead, smart contracts execute transactions without middlemen.

Why DeFi Matters for Everyday Users

• Access financial services without a bank

• Earn interest on your savings at higher rates than banks

• Swap assets instantly and globally

• Take out crypto loans with no credit checks

Why Everyday People Should Use DeFi

When people hear about DeFi (Decentralized Finance), they often assume it’s just for crypto traders, tech geeks, or finance pros. But the truth is, DeFi offers real, practical benefits for everyday users—especially if you’re tired of dealing with traditional banks, hidden fees, and slow transactions.

If you’ve ever been frustrated by your bank limiting your access to funds, charging ridiculous fees, or offering near-zero interest rates on savings, DeFi offers an alternative where you have more control, better returns, and faster access to your money.

So, let’s break it down—what parts of DeFi actually make sense for regular people who aren’t hardcore crypto users?

1. Earning Better Interest on Your Savings

💰 DeFi Alternative: Lending and Staking

The Problem with Banks: Traditional banks offer terrible interest rates on savings accounts—often less than 1% APY, while inflation eats away at your purchasing power.

How DeFi Helps:

• Platforms like Aave, Compound, and Curve allow you to lend out stablecoins (like USDC or DAI) and earn real interest—often 5-10% APY or more.

  • NOTE: I do this with Coinbase and earn around 5%—easy money!

• This means instead of leaving your money in a traditional savings account earning almost nothing, you can earn passive income on your holdings.

• Stablecoins are pegged to the US dollar, so you’re not exposed to the volatility of Bitcoin or Ethereum.

✅ Best for people looking to grow their savings without taking big risks.

2. Sending Money Instantly with Low Fees

🌍 DeFi Alternative: Stablecoins & Decentralized Payments

The Problem with Banks: If you’ve ever sent a wire transfer or international payment, you know it’s a nightmare—fees are high, transfers take days, and banks can freeze or delay transactions.

How DeFi Helps:

• Using stablecoins (like USDC, USDT, or DAI), you can send money instantly to anyone in the world, with almost no fees.

• No need for a bank, PayPal, or Western Union. Just send directly to the recipient’s wallet.

• Example: Sending money abroad through a bank may take 3-5 days and cost $20+. With stablecoins? It’s nearly instant and costs less than $1.

✅ Best for freelancers, remote workers, and anyone who sends or receives money internationally.

3. Borrowing Money Without Credit Checks

🏦 DeFi Alternative: Crypto Loans

The Problem with Banks:

• Banks require lengthy applications, credit checks, and high interest rates for loans.

• If your credit isn’t perfect, getting a loan is difficult or expensive.

How DeFi Helps:

• Platforms like Aave and Compound let you take out instant loans without a credit check.

• You use crypto as collateral (instead of credit scores), meaning you don’t need to go through a bank’s approval process.

• Borrowing rates are often lower than banks, and you get access to funds instantly.

✅ Best for people who need quick access to cash without going through a traditional bank.

4. Trading & Investing Without Middlemen

📈 DeFi Alternative: Decentralized Exchanges (DEXs)

The Problem with Traditional Stock & Crypto Exchanges:

• Stock trading is limited by market hours (you can’t trade stocks on weekends).

• Crypto exchanges like Coinbase and Binance can freeze withdrawals or require KYC verification.

How DeFi Helps:

• Uniswap, PancakeSwap, and SushiSwap are decentralized exchanges (DEXs) that let you trade crypto 24/7, with no middlemen controlling your assets.

• You always control your funds—no exchange can freeze or limit your money.

✅ Best for people who want full control over their assets and financial freedom.

5. Protecting Your Wealth from Inflation & Bank Failures

🛡 DeFi Alternative: Self-Custody & Asset Diversification

The Problem with Banks:

• Your money in the bank is only as safe as the bank itself. If the bank fails, your deposits may be at risk (beyond FDIC limits).

• Inflation devalues cash savings, making traditional banking a bad long-term store of value.

How DeFi Helps:

• By holding stablecoins, Bitcoin, or Ethereum in a self-custody wallet, you control your funds without reliance on a bank.

• In countries with unstable banking systems, people are already using crypto as a hedge against currency devaluation (e.g., Argentina, Venezuela).

✅ Best for people concerned about inflation or banking instability. 

Most Useful DeFi Tools for Beginners

1. Stablecoins (USDC, DAI, USDT) → Use crypto without worrying about volatility.

2. Decentralized Exchanges (DEXs) → Trade tokens without a centralized exchange.

3. Lending & Borrowing Platforms (Aave, Compound) → Earn interest or borrow without banks.

4. Staking & Yield Farming → Earn passive income by providing liquidity.

How to Get Started with DeFi

1. Set up your Web3 wallet and fund it.

2. Choose a DeFi platform (Uniswap, Aave, or Compound).

3. Start small—try swapping tokens or lending out stablecoins.

4. Learn about risk management before committing large amounts.

Final Thoughts: Why DeFi is Worth Exploring

• If you’re tired of low interest rates, slow transactions, and bank fees, DeFi offers real alternatives.

• If you’ve ever needed faster, cheaper international payments, stablecoins can help.

• If you want more financial control and independence, self-custody wallets protect your assets.

DeFi isn’t just for crypto traders—it’s for anyone who wants a better financial system. You don’t need to go all-in, but even using just a few DeFi tools can help you save money, earn better interest, and take back control.

Other parts of this edition:

• Part 1: Web3 Wallets- Your Passport to Web3

• Part 3: Creating a Web3 Identity

• Part 4: Buying Cryptocurrency

Editorial: So You Wanna Be Web3 Native? Let's Go!

Case Study: How Sarah Went from Web3 Newbie to Web3 Native (and Why It Changed Her Life)

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