There are over 3,000 DeFi projects on the Ethereum blockchain, with many more launching daily. The amount of money in DeFi solutions has risen astronomically. By the end of 2020, over $16 billion were locked in DeFi protocols.
Even though the Bitcoin blockchain was the first to be developed, Ethereum houses most of these projects because of its network and its initiative to be the first blockchain to support the creation of decentralized applications.
DeFi is the new cool, and more people are associating with it than ever before. These DeFi protocols put the users in control of the platform, unlike the traditional centralized finance model that places a central body in charge of decisions and innovations.
These protocols have undeniable value as they now seek to perform the roles of traditional finance better. They include such innovations as collectible marketplaces, NFTs, decentralized exchanges, automated market makers, and liquidity-providing protocols. The top projects are:
DODO is a decentralized exchange created on the Ethereum blockchain and later expanded to the Binance Smart Chain. It operates with a proactive market maker (PMM) algorithm, unlike other exchanges that use automated market makers (AMM). DODO is an on-chain liquidity provider which offers stability.
This is the most popular decentralized exchange. Uniswap allows users to trade asset pairs with a market generated by an algorithm. Uniswap rewards its liquidity providers with a commission from trades in the pool. It has perfectly replaced the traditional order book system with smart contracts.
Games are not outside the reach of the DeFi space. The development of metaverses is even being fuelled daily by major institutional investors. Axie Infinity is an online game where users work with Axies. Axies, the characters developed in the game, are NFTs that have a monetary value.
Each one is unique, scarce, and valuable. Axie is a play-to-earn platform that has put money in the pockets of its players. Users may play for SLP (small love potion) which is earned by completing daily tasks and quests. Its native token is the AXS.
MakerDAO is a blockchain solution for lending, borrowing, and saving coins on the Ethereum blockchain. It has also rolled out its stablecoin called Dai. Stablecoins are a solution developed to address the high volatility of cryptocurrencies. They are coins that are backed to either a fiat currency or another asset or through algorithms.
One industry that has boomed in DeFi is NFTs. With the high demand for digital collectible, many marketplaces have been developed. Open Sea is the leading NFT marketplace. It offers lots of advantages and rare NFTs, plus lots of rewards for its users.
Originally published at DailyCoin
Posted Using LeoFinance Beta