CeDeFi
In short: CeDeFi is a hybrid of centralized and decentralized finance. It combines features of centralized finance, such as company-run platforms, customer…
CeDeFi is a hybrid of centralized and decentralized finance. It combines features of centralized finance, such as company-run platforms, customer support, custody and identity checks, with DeFi tools such as smart contracts, on-chain liquidity pools and tokens.
Why it matters
The idea is to offer the on-chain products and transparency of DeFi with the ease of use and compliance of a centralized service. Users get a familiar account, password recovery and support, while their funds interact with protocols in the background. The trade-off is that they carry two kinds of risk at once: they depend on the company as a custodian, which can freeze accounts or fail, and on the smart contracts it uses, which can contain bugs.
Example
A platform verifies users through KYC and holds their deposits. It routes part of those funds into on-chain lending protocols and shows each user a simple balance that includes the earned yield. Key management and compliance are centralized, while the yield comes from decentralized protocols. When a user asks to withdraw, the payout still depends on the platform processing the request, so knowing who holds the keys is the central question.