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Composability

The ability of DeFi protocols to interact and build on each other.

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What is Composability?

Composability is DeFi's "money legos" property. Protocols can be combined and built upon each other, creating new financial products.

Examples

  • Use stETH (Lido) as collateral on Aave
  • Deposit LP tokens in yield optimizers
  • Flash loans enabling complex arbitrage

Benefits

  • Rapid innovation
  • Capital efficiency
  • New strategies from combinations

Risks

Composability creates dependency chains. A failure in one protocol can cascade.

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