I took out a loan with cryptocurrency and didn’t sign a thing

Last week, I took out a loan without meeting anyone, signing anything, or even interacting with a human being. 

I also invested in a variety of assets that earn interest of up to 5.9 percent a year. I did it all on my own, from my computer. All I needed was some cryptocurrency and a knowledge of how these systems work. 

The amounts were tiny: The loan was $30, and I had $95 worth of crypto earning interest. But I could’ve easily done the same with much larger amounts, at those exact same terms. 

To do all this, I was using freely available DeFi, or decentralized finance, services based on the Ethereum blockchain. DeFi is one of the key usages of Ethereum, which, besides being a cryptocurrency, is also a decentralized app platform where most of the currently available DeFi apps reside. 

DeFi, in general, encompasses financial services which are transparent, decentralized, and trustless. Instead of having to go to a bank to get a loan, provide your ID and credit score, then have a human assess your situation and decide whether you can get the money, with DeFi it’s all algorithmic. A smart contract, with an open-source code available to everyone to check, handles everything. All you need is to provide some ether or ETH — the currency of Ethereum — or another crypto asset as collateral and choose what you want to do. The smart contract takes care of the rest. 

Like I said, all of these services are trustless and decentralized — up to a degree. Some require you to create an account; with others, you don’t even have to enter your email anywhere. Of course, rules apply: You cannot just lend thousands of dollars worth of crypto without any collateral.

Dead simple, even for a newbie

It’s been possible to do this for quite a while, thanks to startups such as Maker, Compound, Nexo, and others. But the process wasn’t always simple for someone who doesn’t know much about Ethereum and cryptocurrencies in general. 

However, a new Ethereum mobile wallet called Argent removes nearly all the friction from DeFi —literally anyone can use it with very little or no prior knowledge. Argent is currently in an invite-only beta, but it’s fully functional, and everything I’ve done with it was real — actual cryptocurrency was moved around and locked in smart contracts that provided the functionality described above. 

Let’s say you’re a complete newbie when it comes to cryptocurrencies. After installing Argent, which is a regular mobile app (I used the iOS version, but it’s also av