DeFi stands for Decentralized Finance. It describes the idea of not needing a trusted third-party to execute financial services, but with a blockchain in its place to enable people, and in the future, machines to become their own bank for these services, removing counterparty risks.
Setting up a masternode on DefiChain allows you to participate in the consensus protocol and receive staking awards. One thing to note is that in order to set up a masternode, you must have a minimum of 1 million DFI tokens.
Please note that you need to have some basic familiarity with the Linux terminal to do it.
Here is the official instruction on how to stake DeFiChain.