The 7 largest DeFi projects in 2021.Last summer we were talking about… | Via ChangeNOW.io | The Capital | June 2021
Last summer, when we talked about the rapid rise of DeFi, the industry was at the bottom of its true prosperity. Take a look at this chart: in the summer of 2020, this line seems to be a bit close to zero, even though 4B dollars have been locked in the industry at that time:
Even then, some people were still discussing the “DeFi bubble”, but a year later, the market had grown tenfold. What is its view on decentralized finance?
DeFi has brought a revolution to global finance. If there is no centralized entity, it can provide financial services such as lending. Loan, earn interest and asset management. People like DeFi because there is no intermediary agency that works slowly like a bank and can limit the use of your funds at will; it is more private than fiat currency CeFi (not completely anonymous, but without any personal data); no bureaucracy-no credit check , You can get what you want in a few minutes.
The DeFi protocol is a Dapp written with smart contracts and running on a blockchain platform (mainly Ethereum). In this article, we will introduce the 7 largest DeFi projects locked in total value as of June 2021. They are lending services, decentralized exchanges, assets and asset management platforms. This is how it looks:
See how the market is growing-here is a screenshot taken a year ago:
The list of top platforms has not changed much, but the leading projects have grown several times.
Total locked value: $10.7B
Aave allows you to earn interest on deposits and borrow assets.
If you want to earn passive income, please deposit your DAI, ETH or other Ethereum-based assets. This is how you provide liquidity to Aave, the money that others will borrow. Your interest rate will depend on the balance of supply and demand.See what your APY (annual return) is Here.
If you want to borrow a token, you can also borrow it here-stablecoins, ether and other assets are all available. Use variable or stable APY. The money is locked in a smart contract that has been proven reliable in the past few years. Overall, Aave is an open source project, so anyone can review its code and interact with its user interface and API.
In Aave, fast loans are also provided-the type of operations where borrowing and repayment occur as part of a single transaction. The advantage here is that you don’t need collateral to get a loan. Lightning loans were hacked many times in 2020, but Aave happened to be safe, but it did not deny the potential risks.
The Aave token is a governance token: you don’t need it to access the services of the network, but you have the right to vote when making decisions about the future of the protocol.
Total locked value: $7.1B
Curve Finance is a DEX that allows stablecoins (DAI, USDT, USDC) and packaged assets (WBTC, WETH) to be traded at low fees. Despite the complex interface, Curve has become the second largest DeFi project: there are many stablecoins on the market, and other tools cannot make them cheap.
In addition, Curve allows passive income. The protocol uses a liquidity pool-a smart contract that locks the tokens of a specific currency pair, such as DAI-USDC. The liquidity in this pool is provided by users, and they are rewarded for it. Like Aave, Curve is non-custodial: funds are locked in a smart contract, and project founders and developers cannot access it.
Total locked value: $6.6B
Like Aave, Maker DAO allows the borrowing and lending of cryptocurrency without an intermediary. The mechanism is slightly different: here, you deposit ETH as collateral and obtain a loan with DAI, which is a stable currency pegged to the U.S. dollar. Once you come back to repay the loan, you will pay the stability fee (interest).
If you want to lend your cryptocurrency to other users, you can also do so and you will be rewarded with MKR tokens. This is also a governance asset that gives you the right to vote on platform decisions, such as determining the time spent on stability.
Total locked value: $6.5B
In Compound, you can deposit coins such as ETH, BAT, and USDC. Your interest will be accumulated in the same way. After depositing funds, you can still borrow money, and the previously deposited assets can be used as collateral.
When you lock the tokens in Compound, you will get the equivalent of CTokens-ERC-20 tokens representing the initial deposit plus accrued interest. You can return your CToken to Compound at any time, and get your coins back with the accumulated interest.
The COMP token is spread among all people stored in the Compound smart contract. Although this is a governance token, its price rose rapidly, and people began to use it for trading and speculation. Income compounding began to be regarded as passive income. In DeFi, this is called yield agriculture.
Total locked value: $5.5B
As you can see, there are a large number of various items in DeFi. Novices may be confused, and experienced users may get tired of switching from platform to platform. InstaDapp combines them all into one application and helps manage all your balances in Aave, Maker, Compound and Uniswap. Think of InstaDapp as a bank where you can get all services at once: deposit, exchange and borrow funds.
InstaDapp is free. You only need to pay the Ethereum network fees.
Total locked value: $5.5B
Uniswap is probably the most popular Ethereum-based decentralized exchange: it allows the exchange of all Ethereum-based assets. Pay standard network fees and liquidity provider fees. Just like Curve, Uniswap utilizes a liquidity pool: Providers lock funds there and get rewards when someone makes a transaction. You can also use Uniswap Add liquidity to the pool And profit.
The governance token UNI is used to make decisions on the further update of the agreement and the use of funds.
Total locked value: $4.2B
Yearn Finance allows you to optimize the income you get on other DeFi platforms. You can lock funds in Curve’s liquidity pool through yearn.finance and get some YFI tokens for this. This is another option for yield agriculture.
Total locked value: $7.9B
Bonus tracks! We collected the main DeFi projects from the Defipulse portal-however, it mainly features Ethereum-based platforms. But DeFi is more than that: Recently, Binance Smart Chain has also received widespread attention. This is the blockchain launched by Binance, focusing on efficiency and cost reduction.
PancakeSwap is a DEX running on BSC, helping to exchange hundreds of BSC-based assets at a cost many times lower than Ethereum. This DEX works like Uniswap-with its liquidity pool and its governance token CAKE.
When this article was published on the ChangeNOW original blog a year ago, we wrote in it: For DeFi, 2020 seems to be just the beginning, and it turns out to be true. The largest asset has grown tenfold, and dozens of new assets have emerged. The opportunities DeFi offers — loans without bureaucracy, passive income in many ways — have been appreciated by millions of users, and millions of people are waiting for their turn. Will you be in it?