Meta Dollar Coin play a central role in powering Decentralized Finance (DeFi)

MDC play a central role in powering Decentralized Finance (DeFi) — they’re the fuel, currency, collateral, rewards, and governance tools that make DeFi work.

🎮 1. Currency & Medium of Exchange

Crypto coins are used as money inside DeFi platforms.

• You swap one coin for another on DEXs (e.g., ETH → USDC on Uniswap).

• Stable coins (e.g., USDT, USDC, DAI) are used to represent fiat currencies like USD.

• You pay fees or earn interest in crypto coins.

📌 Example: Use ETH or BNB to trade, pay gas fees, or buy NFTs.

🏦 2. Collateral for Loans

In DeFi lending protocols, you lock up crypto as collateral to borrow other assets.

• Lock 1 ETH → borrow 500 DAI (a stablecoin)

• If the value of ETH drops too much, the system auto-liquidates your collateral.

📌 Example: Aave, Compound, MakerDAO use coins as collateral.

💰 3. Interest & Yield Farming Rewards

DeFi platforms reward users with crypto coins for participating.

• Provide liquidity → earn LP tokens + interest + rewards

• Stake tokens → earn more tokens (APY)

📌 Example: PancakeSwap pays users in CAKE for staking.

👑 4. Governance Tokens

Many DeFi platforms are governed by DAO (Decentralized Autonomous Organizations) — where holding a governance coin gives you voting power.

• Propose or vote on changes to the protocol (fees, rules, upgrades)

• The more tokens you hold, the more influence you have

📌 Example: UNI (Uniswap), COMP (Compound), AAVE (Aave) are governance tokens.

🔧 5. Utility Tokens (Platform Fuel)

Some tokens are used to pay fees, unlock features, or access services.

• Use tokens to get discounts, faster service, or premium access

📌 Example: BNB is used to pay lower fees on Binance Smart Chain.

🛠️ 6. Incentives for Network Growth

DeFi projects often launch their tokens to:

• Attract liquidity

• Reward early users

• Create a loyal community

This creates a self-sustaining economy powered by tokens.

💡 Summary: Roles of Coins in DeFi

Crypto coins are not just digital money — in DeFi, they are the lifeblood of the system, replacing banks, institutions, and middlemen.