Smart Contracts
Beginner
Updated 11/26/2025
What is
DeFi?
Decentralized Finance - financial services built on blockchain without traditional intermediaries like banks.
DeFi (Decentralized Finance) refers to financial applications built on blockchain that operate without centralized intermediaries. On Ergo, DeFi leverages the eUTXO model for secure, deterministic smart contracts. Applications include DEXs, lending protocols, stablecoins, and more - all permissionless and censorship-resistant.
Key Points
- Financial services without banks
- Permissionless and open to all
- Smart contract-powered automation
- Ergo's eUTXO provides security advantages
- No KYC or geographical restrictions
- 24/7 availability
Use Cases
1
Trading on decentralized exchanges (DEXs)
2
Earning yield through liquidity provision
3
Borrowing and lending without banks
4
Stablecoin usage for stable value
5
Derivatives and synthetic assets
Technical Details
Ergo DeFi benefits from eUTXO's deterministic execution (no failed transactions with lost fees), native multi-asset support (efficient token swaps), and Sigma Protocols (privacy-preserving DeFi). Examples include SigmaUSD, historical DEX designs such as Spectrum/ErgoDEX, and current or future lending and trading protocols. Verify each deployment's live status before using funds.
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Frequently Asked Questions
Questions about DeFi
Common questions about this topic
What can I do with Ergo?
Ergo supports a broad ecosystem: use SigmaUSD, explore historical and current DeFi references, mix transactions with ErgoMixer where lawful, collect NFTs, mine with GPUs, bridge to other chains via Rosen, and build dApps with ErgoScript. Always verify current project status before sending funds to a third-party app.
Explainer
Getting Started
How to provide liquidity on Ergo?
Providing liquidity on Ergo depends on the current active DEX or AMM venue. In general, you deposit equal value of two assets into a pool, receive LP tokens representing your share, and earn a portion of trading fees. Spectrum Finance is historical/frozen since February 2024, so verify the active venue, contracts, liquidity depth, and withdrawal process before depositing funds.
How-to
DeFi
How to build DeFi on Ergo?
Building DeFi on Ergo starts with understanding the eUTXO model and ErgoScript. Unlike account-based chains, Ergo's box model provides deterministic execution, strong MEV-resistance, and predictable fee construction. Use Oracle Pools for price feeds, and study existing patterns from Spectrum Finance and SigmaUSD.
How-to
DeFi
How to get started with Ergo?
Start by getting a wallet (Nautilus for browser, Terminus for mobile). Back up your seed phrase securely offline. Get some ERG from a current exchange or verified venue, then make a small test transaction. After that, explore NFTs, mining, DeFi references, or the developer stack if you're a builder.
How-to
Getting Started