# SoK: Decentralized Finance (DeFi)

arXiv: https://arxiv.org/abs/2101.08778 · HTML: https://mlsanity.com/paper/2101.08778/

## Key facts

- Cited by 23 papers in the map (data through 14 Oct 2026).
- First posted on arXiv 21 Jan 2021.

## Built on by (most cited first, 23 of 23)

- [Explainable AI via Learning to Optimize](https://mlsanity.com/paper/2204.14174/) (2022)
- [Ethereum Fraud Detection via Joint Transaction Language Model and Graph Representation Learning](https://mlsanity.com/paper/2409.07494/) (2024)
- [Cooperative AI via Decentralized Commitment Devices](https://mlsanity.com/paper/2311.07815/) (2023)
- [Detecting Financial Bots on the Ethereum Blockchain](https://mlsanity.com/paper/2403.19530/) (2024)
- [SoK: Blockchain-Based Decentralized AI (DeAI)](https://mlsanity.com/paper/2411.17461/) (2024)
- [Logic Meets Magic: LLMs Cracking Smart Contract Vulnerabilities](https://mlsanity.com/paper/2501.07058/) (2025)
- [Auto.gov: Learning-based Governance for Decentralized Finance (DeFi)](https://mlsanity.com/paper/2302.09551/) (2023)
- [Do not rug on me: Zero-dimensional Scam Detection](https://mlsanity.com/paper/2201.07220/) (2022)
- [DeXposure: A Dataset and Benchmarks for Inter-protocol Credit Exposure in Decentralized Financial Networks](https://mlsanity.com/paper/2511.22314/) (2025)
- [The Design Principle of Blockchain: An Initiative for the SoK of SoKs](https://mlsanity.com/paper/2301.00479/) (2023)
- [Towards Secure Program Partitioning for Smart Contracts with LLM's In-Context Learning](https://mlsanity.com/paper/2502.14215/) (2025)
- [Machine Learning on Blockchain Data: A Systematic Mapping Study](https://mlsanity.com/paper/2403.17081/) (2024)
- [Investigating Similarities Across Decentralized Financial (DeFi) Services](https://mlsanity.com/paper/2404.00034/) (2024)
- [DMind Benchmark: Toward a Holistic Assessment of LLM Capabilities across the Web3 Domain](https://mlsanity.com/paper/2504.16116/) (2025)
- [From Rules to Rewards: Reinforcement Learning for Interest Rate Adjustment in DeFi Lending](https://mlsanity.com/paper/2506.00505/) (2025)
- [Benchmarking Temporal Web3 Intelligence: Lessons from the FinSurvival 2025 Challenge](https://mlsanity.com/paper/2602.23159/) (2026)
- [Early Rug Pull Warning for BSC Meme Tokens via Multi-Granularity Wash-Trading Pattern Profiling](https://mlsanity.com/paper/2603.13830/) (2026)
- [Slow is Fast! Dissecting Ethereum's Slow Liquidity Drain Scams](https://mlsanity.com/paper/2503.04850/) (2025)
- [DecoKAN: Interpretable Decomposition for Forecasting Cryptocurrency Market Dynamics](https://mlsanity.com/paper/2512.20028/) (2025)
- [SPEAR: An Engineering Case Study of Multi-Agent Coordination for Smart Contract Auditing](https://mlsanity.com/paper/2602.04418/) (2026)
- [DeFiFusion: Combining Transaction Events with Smart Contracts to Detect Price Manipulation Attacks](https://mlsanity.com/paper/2609.11008/) (2026)
- [DeFiFlowBench: Benchmarking and Improving Safe Executability in Natural-Language DeFi Workflow Synthesis](https://mlsanity.com/paper/2609.11504/) (2026)
- [SoK: Decentralized Agent Economic Infrastructure](https://mlsanity.com/paper/2610.01756/) (2026)

## Abstract (arXiv)

Decentralized Finance (DeFi), a blockchain powered peer-to-peer financial system, is mushrooming. Two years ago the total value locked in DeFi systems was approximately 700m USD, now, as of April 2022, it stands at around 150bn USD. The frenetic evolution of the ecosystem has created challenges in understanding the basic principles of these systems and their security risks. In this Systematization of Knowledge (SoK) we delineate the DeFi ecosystem along the following axes: its primitives, its operational protocol types and its security. We provide a distinction between technical security, which has a healthy literature, and economic security, which is largely unexplored, connecting the latter with new models and thereby synthesizing insights from computer science, economics and finance. Finally, we outline the open research challenges in the ecosystem across these security types.