## Algorithmic Trading Introduction In this lesson, we will be exploring the world of DeFi and algorithmic trading. We will be building scripts that allow us to automate the process of portfolio rebalancing. We will learn how to use platforms like Aave and Uniswap to manage our cryptocurrency assets. The idea is that we want to automate the process of transferring a portion of our USDC (a stablecoin) to ETH, so that we have a larger percentage of our portfolio invested in ETH. While we will not be writing smart contracts in this lesson, we will learn how to use existing DeFi smart contracts to manage our assets. The DeFi space is all about using smart contracts to replace traditional finance applications, and this lesson will give us the tools to begin building our own decentralized financial tools. We can see the difference in interest rates for various tokens, such as USDC and ETH: ``` Assets Wallet balance APY ZK 0 0.02% ETH 0 0.32% WETH 0 0.32% wsETH 0 0.10% USDC 0 4.45% USDT 0 4.52% ``` Here is a simplified way to represent the process: **What we have** * USDC (a stablecoin) - 50% of our portfolio * ETH - 50% of our portfolio **What we want** * USDC - 30% of our portfolio * ETH - 70% of our portfolio The process of automatically rebalancing our portfolio will involve using a combination of DeFi tools, such as: * **Aave:** We will use Aave to deposit and earn interest on our crypto assets. * **Uniswap:** We will use Uniswap to swap tokens to achieve the desired portfolio allocation. We will use these tools together to rebalance our portfolio automatically without having to manually interact with the interfaces. This is an example of how we can leverage DeFi to automate financial processes and gain greater control over our assets.