DeFi is revolutionizing the traditional financial system by providing decentralized, open-source financial services. Built primarily on Ethereum, DeFi platforms offer lending, borrowing, trading, and yield farming without intermediaries like banks. This democratizes access to financial services, especially in underbanked regions. However, the rapid growth of DeFi also brings risks such as smart contract vulnerabilities and regulatory challenges. As the space matures, balancing innovation with security and compliance will be crucial for sustainable development.