A Smart Contract is an algorithm that runs and operates on a blockchain when predetermined conditions are met.

Smart contracts are an important part of decentralized finance (DeFi), as they allow for the automation of complex financial transactions and the creation of decentralized applications (dApps) on blockchain networks.

By using smart contracts, DeFi protocols and dApps can enable users to enter into agreements and execute transactions without the need for intermediaries, such as banks or other financial institutions.

Smart contracts are considered to be more secure and transparent than traditional contracts, as they are executed on the blockchain and are visible to all parties involved in the transaction. This helps to reduce the potential for fraud or misunderstandings, and it can make it easier for users to trust and participate in DeFi applications and protocols.

Smart contracts are an essential part of the infrastructure of DeFi, and they play a crucial role in enabling the growth and development of the DeFi ecosystem.

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