Harnessing AI in Decentralized Finance (DeFi): Transforming Global Trade and Financial Governance in Crypto-Economies

DOI

10.2991/978-2-38476-559-1_30How to use a DOI?

Keywords

Artificial Intelligence (AI); Decentralized Finance (DeFi); Crypto-Economies; Global Trade Governance; Smart Contracts

Abstract

The use of AI and the smart decision-making that harvests much automation and decentralisation are also causing massive changes in the workings of the financial system. The study concentrates on the use of AI in DeFi and the possibility of it transforming the way trade and finance are managed in global crypto-economies. The main point is to analyse the improvements machines and analytics can make to the transparency of DeFi platforms and the mechanisms of their functioning, as well as the ability of the system to operate with high scalability of transaction flows effectively. To tackle this paper, several case studies were performed through a qualitative research approach to DeFi platforms such as Chainlink, Aave, and MakerDAO. The information was gathered on platform documentation, analytics websites, developer publications, and interviews. The role of AI within the framework of a comparative study was tested in the study using thematic coding and the establishment of a comparative framework to determine the role AI plays in providing smart contract execution, risk management, anomaly detection, and maximising governance. The findings of research show that the complexity of transactions can be managed with the help of automation, and the DeFi system will constantly evaluate risks and ensure that there are no middlemen in trading between countries. However, application of AI poses issues like a lack of transparency in the algorithm, ambiguities in regulation and increasing cybersecurity threats. My study provides novel insights into the intersection of AI and DeFi through the postulation of a governance model that promotes decentralised governance, transparency of rules with algorithms and compliance with universal standards of operation. This report will help policymakers, developers and financial organisations build up to, or beyond, inclusive, strong and intelligent financial systems through AI-based DeFi management.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - K. Balaji
AU  - P. Seshagiri Rao
PY  - 2026
DA  - 2026/04/19
TI  - Harnessing AI in Decentralized Finance (DeFi): Transforming Global Trade and Financial Governance in Crypto-Economies
BT  - Proceedings of the Global Innovation and Technology Summit “AAROHAN 3.0”_HSS track (GITS-HSS 2025)
PB  - Atlantis Press
SP  - 466
EP  - 478
SN  - 2352-5398
UR  - https://doi.org/10.2991/978-2-38476-559-1_30
DO  - 10.2991/978-2-38476-559-1_30
ID  - Balaji2026
ER  -