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What is the importance of smart contracts in Decentralized Finance (DeFi)?

Smart contracts play a crucial role in Decentralized Finance (DeFi) by automating and enforcing financial agreements without the need for intermediaries. These self-executing contracts run on blockchain networks, ensuring transparency, security, and immutability of transactions. In DeFi, smart contracts enable seamless peer-to-peer lending, borrowing, decentralized exchanges, and other financial activities, providing users with greater control over their assets. The importance of smart contracts lies in their ability to foster trustless interactions, reduce operational costs, and create a decentralized ecosystem that revolutionizes the traditional financial landscape.