What is the role of Web3 in decentralized finance (DeFi)?

The role of Web3 in decentralized finance (DeFi) is to provide a foundation for financial applications that operate without traditional intermediaries, like banks or brokers. Web3 makes use of blockchain technology and smart contracts, allowing users to conduct financially related activities with each other directly, such as lending, borrowing, trading, and earning interest. Such a decentralized setup allows trustless transactions whereby users can engage in financial activities in a fully transparent and secure manner, with no need for intermediation by any kind of centralized entity. Web3 infrastructure makes DeFi platforms available to anyone globally 24/7 and not at the mercy of singular entities for control. In turn, this brings greater financial inclusion and autonomy to the users. The programmability aspect of Web3 brings new financial products and services that have not been possible with traditional finance; hence, Web3 is an important backbone in the growth and sustainability of DeFi.