The DeFi stack, and who protects you at each layer
Each layer depends on the ones below it. Protections Canadians may expect from a bank do not carry over into DeFi.
Infographics
DeFi infographics with worked numbers
Seven infographics with worked numbers: the DeFi stack, a DEX swap, health factor, stablecoin designs, the Canadian crypto tax map, custody and the DeFi risk map.
How a DEX swap moves a pool's price
Worked example in a constant-product pool (x × y = k) with a 0.3% fee. Swapping 100 A into a 1,000 A / 1,000 B pool returns about 90.66 B, not 100: a 9.3% shortfall from price impact plus the fee.
Health factor: how far a loan is from liquidation
Worked example: 2 units of collateral at $4,000 each, an 80% liquidation threshold and $4,000 borrowed give a health factor of 1.60. Liquidation starts if the price falls to $2,500, a 37.5% drop.
Three ways to build a stablecoin, and how each can break
Design determines failure mode. In Canada, no stablecoin is CDIC-insured, and the federal Stablecoin Act was enacted on 2026-03-26 but was not in force as of 2026-10-30.
Canadian crypto tax map: what CRA has said, and where it is silent
Based on CRA pages modified between 2025-10-29 and 2025-12-02 and checked 2026-10-30. Education only; your facts decide your treatment.
Who holds the keys? The custody spectrum
Moving right gives you more control and more responsibility. There is no option with full control and no responsibility.
DeFi risk map: likelihood and severity (editorial)
An editorial teaching map, not a measurement. Positions reflect how often each risk tends to affect ordinary users and how badly when it does.
Education only. Nothing on this page is financial, investment, tax or legal advice, or a recommendation to buy, sell, stake, lend or borrow any crypto-asset. Crypto-assets can lose some or all of their value and are not covered by CDIC. Canadian rules change: check the dated sources above and talk to a qualified professional about your situation. Full disclaimer.