Deobank is a bank that uses blockchain technology and DeFi tools to provide all conventional banking services while allowing users to maintain full control over their money.
What is Deobank?
Deobank, or "decentralized on-chain banking," is a bank that uses blockchain technology and DeFi tools to provide all conventional banking services while allowing users to maintain full control over their money.
Traditional banks are like storage warehouses: You hand your money over to someone else to keep it safe. In contrast, Deobank is like a network of personal safes. You can still easily transfer money to others, but you are the only one who holds the key to your safe and never lose control of your money, even when using banking services like savings accounts, loans, and payments.
How does Deobank work?
Decentralized banks (Deobank) operate on the blockchain network, which is why they can offer banking services at much lower fees than traditional banks. Since you control your own money (known as "self-custody"), you don’t have to worry about the bank going bankrupt or freezing your account.
Special computer programs — smart contracts — automatically follow rules without human supervision. Want to send money to someone? Smart contracts will take care of it. Need to earn interest on savings? Another smart contract will step in.
What features do Deobanks offer?
Deobank is a relatively new technology, so there are no strict classification criteria required yet. However, one can expect to see the following characteristics and functionalities in a typical deobank:
• You have complete control over your assets, with no third party able to access, freeze, or seize your money.
• Traditional banking services such as savings, debit cards, interest rates, etc.
• Payments and transfers are made through the internal network system (on-chain rails).
• Use stablecoins and/or central bank digital currencies (CBDCs).
• Governance by token as part of the decision-making process.
Digital banks (Deobanks) compared to modern digital banks (Neobanks)
Digital banks (Neobanks) are banks that operate solely on digital platforms but comply with traditional banking regulations. They are custodial banks, meaning they hold users' money, and operate on centralized infrastructure. Accounts — checking accounts, savings, debit cards, payments, etc. — are typically managed entirely online through specialized applications.
In contrast, Deobank is a technology-based bank operating on decentralized infrastructure. They are often non-custodial banks, meaning users have full control over their assets, or partially custodial. They provide "traditional" banking services in a DeFi environment.
Electronic banking compared to cryptocurrency exchanges and brokers
Although electronic banks, cryptocurrency exchanges, and brokers may seem similar, they serve different purposes in the digital finance space:
• Cryptocurrency exchanges are digital markets where people buy and sell cryptocurrencies.
• Brokers are intermediaries who manage cryptocurrency transactions for those who want to avoid trading directly with exchanges.
• Decentralized banks (deobank) focus on comprehensive banking services rather than mere transactions. They provide deposits, loans, savings accounts, and daily payments — a full-service digital bank built on blockchain technology. Although using advanced decentralized systems, deobank still gives the feeling of using a conventional bank account, only with more control and lower fees.
Author
Maksym Sakharov is the CEO, co-founder, and board member of WeFi, a decentralized on-chain banking platform aimed at democratizing access to DeFi. With over eight years of management experience in the IT and blockchain industry, Maksym has built a global fintech business providing organizational-level blockchain banking infrastructure to users in over 80 countries.
❣️To participate in WeFi – the Deobank chain bank, you only need a few simple steps:
Step 1: Access the official link:
👉 https://app.wechain.ai/register?ref=rpvacl5qe0
Step 2: Enter basic information: email, password.
Step 3: Verify KYC (identity card or passport).
Step 4: Log in, add crypto or fiat assets.
Step 5: Activate the WeFi card (virtual or physical) for global payments.