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Understanding the State of Crypto Lending: A Deep Dive into CFI and DeFi

The world of cryptocurrency lending can be bewildering, even for seasoned investors. However, a recent report titled "The State of Crypto Lending: Bringing Transparency to an Opaque Market," published in April 2025 by Galaxy Research, aims to clarify the complexities surrounding borrowing and lending in both centralized finance (CFI) and decentralized finance (DeFi). This article breaks down the key insights from the report, transforming intricate terminology into understandable concepts.

The Basics of CFI and DeFi Lending

Before delving into the report, it’s essential to differentiate between lending in CFI and DeFi. CFI encompasses various categories: