Advantages & disadvantages of defi

Advantages 
1. No chances of Human Errors

In the traditional finance system, most of the operations need participation from humans to
run, and that increases the chances of it being run with errors from time to time. With the DeFi
system, the peer-to-peer connection makes sure that there is no need for human participation,
and the automated service system of each of the networks works out way better. 
2. Permissionless Operations 

For almost every transaction incorporated in a TradFi system, one needs to get permission from
an intermediate, making the process time-consuming. In DeFi, one can interact with financial
services without taking permission from anyone. The agility and the peer-to-peer connection
attract more participants. 
3. Lending

In the Crypto circle, especially those under a DeFi chain, one can get a loan with their cold
wallets. This opportunity allows the borrower to gain interest payments and the lenders to
access capital, which puts both parties in a win-win situation. 
4. Decentralized Exchanges 

When one wants to secure their valuable assets in a more closed space, they can use the proof-
of-stake blockchain network present in a DeFi system which will allow them to receive rewards
for providing security and confirming the transactions of a blockchain network.  
5. No-Loss Games and Lotteries 

The smart contracts of a DeFi system can offer operations to its participants where it can have
them participate in a lottery that runs on no loss. Everyone will be returned with the
participating amount where only one lucky winner will gain all the profits, which is done
without any intermediaries.
Disadvantages 
1. Scalability
It is the biggest problem here and in all blockchain systems. The network is not growing as
much as the transaction rates are increasing, and this puts the system in a questionable
position as, day by day, the agility is suffering from these effects. 
2. Uncertainty 
This problem arises mostly in those networks where it is always running with the changes.
There is always market uncertainty for the cryptocurrency, and many of its network systems are
undergoing serious changes. For instance, Ethereum is changing its PoW to PoS, where it is
obvious that new issues will arise.
 3. Liquidity 
We are talking about the whole finance system against the DeFi chain. The Defi only possesses
12.5 Billion Dollars worth of investment by the tenth month of 2020. This is a drop in the ocean
if you compare it with the TradFi system. 
4. Lack of Insurance 
Another setback of a DeFi chain is that it does not provide a seamless insurance protocol to the
investors. This is a serious problem, and many do not trust the system for this lack of authority
and responsibility.