The total value locked (TVL) in DeFi projects just has surpassed $76 billion, with the top five platforms – Maker, Compound, Aave, Curve, and Uniswap – leading the way with a sum of $43 billion altogether.
So far, it is possible to bet on a favorable forecast for DeFi’s performance in 2021, following the tendency that originated in 2020. Accordingly, the enormous cash flow and attention generated by new users boosted a new wave of projects that are helping to build solutions based on blockchain technology and contribute to the market’s maturity.
In this article, you will discover different DeFi projects that are building the gateway for the future of finance.
Decentralized Solutions for Real-World Issues
There is no news that many people want to see DeFi reaching mass adoption, revolutionizing the way people deal with their money and the way people understand financial transactions.
In a financial world with no banks, no intermediaries, no censorship, and no centralization, individual freedom is the only thing that is.
Read more: DeversiFi – advanced DeFi trading edge
Nonetheless, there is still an insistent question – when will we see that in reality? This question may be tough to answer, but it is safe to affirm that it will eventually happen.
Notional is a lending market solution created to allow users to borrow/lend crypto while ensuring certainty in returns.
It is a fully decentralized protocol built on the Ethereum Network where people can borrow stablecoins (USDC, DAI) and pay fixed interest for up to 6 months.
To waive the need for intermediaries, the platform is based on a trust code, with no custodians or counterparty risk.
Consequently, lenders can lend stablecoin with confidence, knowing that they are locking capital in a fixed rate that guarantees their APY. Plus, the platform has a liquidity providing feature, where users can provide liquidity using their DAI or USDC stablecoin to earn yield.
Even so, interest rates and slippage are still subject to changes generated by market volatility. Hence, no user’s transaction will be completed in case the rate becomes unfavorable.
Another great feature is the possibility to obtain coverage from Nexus Mutual, preventing issues like contract bugs, economic attacks (which include oracle failures), and governance attacks.
As a decentralized lending protocol, Notional permits users onboard using a variety of distinct wallets, such as MetaMask, WalletConnect, Ledger, Trezor, and Authereum.
Start lending or borrowing crypto with Notional Finance!
DAOs (Decentralized Autonomous Organizations) are not controlled by centralized efforts, such as a government or central bank. Instead, they are divided among an array of distinct computers and nodes.
Despite the famous DAO hack in late 2016, the concept went further and was materialized successfully by several projects in the scene, including MakerDAO, Augur, and Dash.
In this sense, DAO Maker is building the definitive platform for retail venture investments, both in equity and tokens.
Understanding that the average user cannot afford to risk large amounts of money, their goal is to provide low-risk participation frameworks to retail investors who want to participate in venture capitalism on DeFi projects.
The DAO Maker’s team has been working on launching a platform where users can access distinct options on venture funding but divided into tiered risk levels. This way, people can choose the most suitable option for their case based on their prognostics.
Plus, the project is working to deliver innovative financial products that include near-zero risk: Venture Bonds, Dynamic Equity/Coin Offerings, Refundable Strong Holder Offerings, and Standard Offerings for equity/token issuance for retail investors with maximum risk appetite.
Currently, DAO Maker is still one of many yet-to-launch DeFi projects, and its crowdfunding platform is live for users to participate.
It is impossible to deny the impact of Proof of Stake (PoS) in the blockchain landscape. In essence, people participating in a PoS-based network can mine or validate block transactions according to the number of coins/tokens staked in the process. Hence, the more coins staked by a miner, the more mining power it has.
DragonStake is one of DeFi projects focused solely on blockchain security, operating validators on several networks built upon PoS consensus mechanisms.
The project was born in “La Colmena” (lit. “the beehive”), a well-known crypto-community based in the South of Spain.
DragonStake’s portfolio has some of the most important networks outside of the “Ethereum halo” nowadays, such as:
- Sentinel Avalanche
Plus, the team’s portfolio tends to expand further as the blockchain ecosystem expands itself.
Usually, they like to take part in networks from the earliest testnets, helping to develop the structure and stamp their footprint in the governance processes.
One of the most prolific segments in terms of crypto-based innovation is payment methods. In this sense, even traditional players in the field are incorporating new solutions to supply the growing demand for cryptocurrency payments.
For example, PayPal is currently allowing users in the United States to buy, sell and hold several cryptocurrencies (e.g., BTC, LTC, ETH, and BCH) directly through their Personal or Premier PayPal accounts.
Plus, there is already an established niche of DeFi projects that focus on cryptocurrency-based payment solutions, such as BitPay, CoinGate, and Cryptopay.
Following this innovative trend, Paypolitan is a new platform that aims to provide an all-in-one payment solution that combines traditional and DeFi banking. Their goal is to provide a mobile payment platform for fiat and crypto, enabling DeFi features like yield farming.
Through Paypolitan, users will be able to have a seamless payment app like Apple Pay, permitting them to incorporate an unlimited number of bank and crypto accounts.
Also, users will be able to earn returns on their Paypolitan savings accounts and regular passive income for those who engage in liquidity provision.
Other features include a staking program and a native governance token (EPAN) that incentivizes hodling.
Check out the Paypolitan website to learn more!
Akash Network promises to be the world’s first DeFi-based solution in terms of cloud computing. The project aims to provide an alternative to centralized cloud providers such as Amazon, Google, and Microsoft.
So far, the project has announced important integrations with several networks outside of the Ethereum space, such as Tendermint, Cosmos, Solana, Kava, and Chainlink.
Recently, Akash launched MAINNET 2, providing developers a way out of the limitations imposed by traditional cloud infrastructure. This way, developers are now capable of launching applications on a decentralized cloud, which includes:
- Data visualizations
- Block explorers
- Blockchain nodes
- Blockchain network components
Now, developers and companies can decentralize their cloud infrastructure, accelerating scalability for the blockchain ecosystem with faster deployment of applications and more cost-efficient processes.
Get started on the Akash Network website!
The Best Of DeFi Projects Is Yet to Come!
Is the future of finance decentralized? Yes, indeed. Even though this process is still in course nowadays, it is not hard to forecast the tendencies for the next decade (and beyond).
Since MakerDAO’s inception in 2014 and the first use cases of eDollar (DAI’s precursor), it was plain to see that the future of finance would be paved by decentralization and blockchain technology altogether.
Further reading: Connext Network – next step for DeFi accessibility
While the world economy is still recovering from the COVID-19 pandemic, the crypto industry is lighting the path to show how blockchain-based and DeFi solutions can be the answer for an expedited recovery in any market segment.
Kylin Network is building a unique cross-chain platform to provide data infrastructure for DeFi and Web3. Powered by Polkadot, the network offers instant-but-reliable on/off-chain market data and social data sources.
To reunite an expedite performance and trusted validity for all information, Kylin leverages the power of Polkadot/Substrate Framework on open networks.
Currently, the project has three main features: Kylin Data Analytics, Kylin Data Oracle, and Kylin Data Marketplace.
The Kylin Data Analytics combines analytic tools designed for data warehouses to provide a unique query engine and RESTful API for external analytics tools and third-party apps.
Secondly, there is the Kylin Data Oracle, which is an advanced data feeding protocol powered by Polkadot/Substrate. Being fully decentralized, this feature offers multiple real-time data sources in synergy with off-chain workers.
Lastly, there is the Kylin Data Marketplace, which is an open platform for data exchange and pricing. This way, DApps built Polkadot can seamlessly collect both on and off-chain data by paying a low fee.
For governance purposes, the platform will issue the KYL token, which is also a way to secure the decentralized data network and power it with further possibilities.
There are virtually countless application scenarios for Kylin, which includes:
- Decentralized insurance automated payment services
- Stablecoin/crypto derivative platforms
- Crypto lending markets
- Cross-chain DEXes
- Decentralized gaming and casino services
- Blockchain computing services
Kylin is still in the pre-launch stage, with the project’s private testnet being expected at the end of 2021.
Learn more about Kylin Network on its website!
Nowadays, the foreign exchange (FOREX) market is still the world’s largest and most liquid financial powerhouse, even surpassing the stock market.
As provided by data from the Triennial Central Bank Survey, global FX and OTC derivatives markets have a daily volume of $6.6 trillion. Plus, the worth of the entire global FOREX trading market is estimated at approximately $2.4 quadrillion.
With the growing expansion of decentralized finance, the birth of new DeFi projects to bridge the power of FOREX trading with the potential of decentralized finance features is a natural thing.
In this sense, the Onomy Protocol is a project that aims to build a multi-chain DEX to bridge traditional and decentralized finance. This way, the project will leverage the power of traditional assets using an entirely modernized infrastructure provided by DeFi.
In layman’s terms, Onomy users will be able to mint, trade, and lend stablecoins across different blockchain ecosystems.
Given that DeFi is still too dependent on Ethereum, Onomy believes that scalability is a core factor in implementing their idea. Hence, the project is built on Cosmos to offer the much-needed interoperability to bridge Ethereum and other ecosystems.
Currently, Onomy is still a yet-to-launch project.
Learn more on the Onomy website!
If the future is decentralized, DAOs are likely to be a trend when the time finally arrives. DAOstack offers an easier path for those building a DAO of any kind, helping to advance the technology and adoption of decentralized governance models.
The project is an open-source platform that is building an open-sourced and modular software stack for DAOs, including a library of governance protocols and user-friendly interfaces where people can create and manage DAOs.
Hence, the stack can be used to build decentralized organizations for any kind of collective work. Plus, the platform provides the necessary tools to link these organizations and ensure that, as the network expands, all its member organizations get stronger as well.
To provide a cost-efficient structure with unlimited scalability, DAOstack is deployed on Alchemy. For those unaware, Alchemy is a powerful suite of developer tools that permit projects to govern themselves by allocating shared resources and effective decision-making.
Learn more about this project on the DAOstack website!
DeFi-Powered Trading and Investment
2021 has been a bullish year for cryptocurrencies in general. Following Bitcoin’s historical $60,000-mark, Ether just hit a +$3,000 mark with a 350% price appreciation this year.
Hence, it is undeniable that there is an ever-growing acceptance of crypto assets among traders and investors, especially after a constant exposition of the appreciation of different cryptocurrencies in the mainstream media.
For example, with the increase in the adoption of crypto assets by leading investment firms, Dow Jones decided to bring Bitcoin and Ethereum to Wall Street with cryptocurrency indexes.
Following this tendency, several DeFi projects are building DeFi-powered solutions for traders and investors who want to seize the advantages of decentralized markets.
Warp is an innovative project that reunites all DeFi economic essentials – lending/borrowing, stablecoins, yield optimization, and native tokens – within a robust platform with fully audited smart contracts.
Warp’s primary goal is to create a new way of looking at unused Liquidity Provider (LP) tokens by using them as collateral for lending. This way, users can deposit LP tokens onto the platform and receive stablecoin loans in exchange.
Meanwhile, while users have their stablecoins, their LP tokens continue to earn rewards from Uniswap. To avoid the persistent risk of Impermanent Loss, the platform wants to enhance the utility of LP tokens, creating a sustainable stream of continuous yield.
The platform’s native token WARP will be issued to reward early users and stakeholders, being utilized for more purposes over time, as new features are implemented in the platform.
In the first quarter of 2021, the platform has already launched the WARP token and the lending/borrowing features on the app. Currently, Warp’s team is working on the integration of Curve and Balancer.
Eventually, Warp will also have layer 2 functionality and enable cross-chain interoperability via Polkadot.
Start using Warp on its website!
Currently, the global derivatives market has a gross market value of approximately $12 trillion.
Although there is a substantial amount of risk in selling options, it is an excellent opportunity for smart traders who want to profit good sums of money.
Similarly, the crypto derivatives market is a profitable environment as well, and Kine aims to offer a unique protocol for decentralized derivatives trading.
The project aims to offer a fast, transparent and seamless manner of trading derivatives on the Ethereum Network. Its goal is to deliver a CeFi-like experience for derivatives trading in a decentralized environment, where both crypto and non-crypto assets will be traded with up to 100x leverage in a wide array of options.
The protocol has launched in late March 2021. Users can start staking their assets to mint kUSD tokens and receive rewards in the form of KINE, the platform’s native token.
The protocol offers a flexible staking portfolio that encompasses several digital assets, including ETH, WBTC, USDC, all major ERC-20 tokens.
Plus, they want to ensure low gas costs for all users and significant advantages for liquidity providers who are willing to embrace the idea to receive KINE tokens (which also can be used for staking).
The project’s team wants to gradually transition towards a community governance model once the protocol fully matures, permitting the community members to decide Kine’s legacy in the future.
Learn more about Kine Protocol on its website!
Despite being a catastrophic year for most economic segments, 2020 was a lucky year for DeFi and its projects, especially with all the hype surrounding yield farming.
Accordingly, 2021 is a promising year for all the industry, especially considering the current bull run. At the moment, variety is the name of the game for developers who want to succeed. Instead of betting on the same ideas, now teams must focus on building projects that solve real-world problems and somehow aggregate value on users’ lives.
Plus, it is not time for segregating CeFi from DeFi. Instead, the tendency is to develop solutions that bridge both the advantages of both worlds and blend them to deliver innovative products/services- and most importantly, all focused on decentralization.