The cryptocurrency universe is growing by leaps and bounds. This burgeoning industry offers opportunities for anyone with an internet connection and a desire to be their bank.
One of the sizzling topics in cryptocurrency is decentralized finance or DeFi. The goal of DeFi is to build an entirely new financial system that is wholly independent of the traditional financial (TradFi) economy. Thousands of developers worldwide are funding this goal with billions of dollars
We have seen developers crowd the market with different projects, each auditioning for your attention, promising good margins and no financial pain. It can be laborious to know which ones are worth your time and money.
This article will look at the top 8 DeFi projects in 2022. These are the projects that we believe have the most significant potential to change the way we interact with money. Keep reading to learn more!
DeFi Projects to Watch Out For Before The End of 2022
DeFi projects are mushrooming everywhere, intending to provide solutions to the centralized nature of the current financial system. So, here is the list of the top DeFi projects that you should keep an eye on in the year 2022:
Any DeFi system must be built on a pre-existing smart contract platform, such as Ethereum, Binance Smart Chain, Solana, Avalanche, etc. These smart contract platforms are currently competing head-on. They are in an arms race to improve security, scalability and customizability, transaction processing speed, or be more energy-efficient and environmentally friendly.
So, because blockchain technology is still in its early stages, there is still plenty of room for more customization of smart contract platforms to help them become even more efficient.
Avalanche is a new-generation smart contract platform developed recently. It competes directly with Ethereum with perceptible advancements like infinite transaction per second (compared to Ethereum’s 14 tps), transaction processing duration of less than 2 seconds, and a high level of security, all based on the Proof of Stake mechanism.
DeFi systems built on Avalanche are also more competitive than those built on other blockchains due to technological advancements in smart contracting. Transactions on Avalanche-based DEXs, for example, are significantly less expensive than those on Ethereum-based DEXs.
2. Idle Finance
Idle finance stands out from other cryptocurrency projects due to its unmatched level of security—being one of the few non-hacked. It has lending DeFi protocols—and a user-friendly design that requires no gas fees for transactions.
The platform provides its users with a decentralized rebalancing protocol to manage digital asset allocations among various third-party DeFi protocols algorithmically and automatically.
Furthermore, their Best Yield product fully maximizes the interest accrual process for users to ensure they are constantly receiving the highest interest rates.
Idle Finance’s Perpetual Yield Tranches, a yield aggregator product that tranches risk and yield, is another industry-defining product. The two related tranches are senior with deposit protection plus yields and Junior with leveraged stablecoin yields.
Despite having such innovative functions, Idle Finance does not require the user’s undivided attention for them to benefit from the platform; the entire model, as the name suggests, is built around ease of use.
Synthetix (SNX), a fast-growing decentralized exchange, allows users to trade crypto for stocks, commodities, currencies, and other assets still dominated by Wall Street, London, and Hong Kong’s traditional financial institutions.
Its most distinguishing feature is that it allows users to create their synthetic assets, known as “synths,” which enable exposure to fiat, derivatives, cryptocurrencies, and various asset classes.
Examples are Bitcoin, USD, euros, Tesla stocks, gold, and other currencies. This means that dealers can bet on the price of an asset without holding the actual asset, making Synthetix one of the most popular DeFi products on the market.
Hodlers can stake their SNX to generate new Synths for trading. Alternatively, they can sit back and collect fees and rewards from the Synthetix exchange (hopefully). However, the primary goal of Synthetix is to trade Synths. Traders can go long or short on an underlying asset on the platform. They accomplish this by holding other cryptocurrencies in Synths.
A trader, for example, could purchase a synthetic MKR token (sMKR) that reflects the price of MKR. However, they would not own an actual MKR token or have voting rights as standard holders would.
To create a new Synth, regardless of whether one prefers staking or trading, one must stake 800% of the Synth’s value in SNX tokens. It is important to note that supply and demand dynamics are here.
The more SNX locked up as collateral, the lower the supply. When it decreases in reserve, the more it increases its value. Currently, approximately 85 percent of the total supply of SNX is locked.
Synthetix also has its cryptocurrency, sUSD, pegged to the US dollar and used to pay transaction fees on the platform.
Bondex is a project with a long-term vision that is slowly but surely gaining recognition in the DeFi space. By resolving the prevalent issues in the blockchain industry, Bondex aims to transform how business gets conducted in the modern world. A tokenized rewards system allows its community of users to own certain parts of the next-generation Web 3.0 talent ecosystem.
Bondex aims to solve the industry’s challenges by leveraging its professional Network and implementing tokenized incentives to maximize the recruitment process and fill the growing talent gap. By using a decentralized P2P model, this project will enable a new revenue-sharing business model.
The Network affects this in three ways: 1) by distributing more profits among its global talent pool and hiring companies, 2) by aligning incentives across all participants for long-term growth, and 3) by changing its economic model.
Recently, Bondex partnered with KyberSwap – Kyber Network’s powerful liquidity hub. As DeFi’s first dynamic market maker, KyberSwap maximizes returns for liquidity providers and provides the best trading rates for token holders alike.
KyberSwap can aggregate liquidity from multiple exchanges (including KyberSwap) and determine the best trade route based on its Dynamic Trade Routing technology. This will give Kyber Network’s liquidity providers another avenue to earn a yield on their idle digital assets.
Bondex and Kyber Network hope to provide a better solution for the decentralized talent economy with this partnership.
5. Sin City
“Sin City” is a Meta-verse multi-player game based on Blockchain Technology. The game’s background occurs in some of the most controversial cities where users can buy digital real estate. Users can purchase this land to build their empires.
There will be a high degree of social interaction on this platform, where people can create clubs for their friends to hang out in, create venues for online events to hold, or even compete in underworld challenges to win in-game rewards.
Featuring some of the high octane thrills of games like Grand Theft Auto on the blockchain, it’s appealing to many users, including game enthusiasts. Unlike other games, Sin City offers a unique 3D open world, play-to-earn model, in which a player can earn the native $SIN token and prosper both as an in-game player and an investor.
6. Keep Network
Keep Network (KEEP) is a decentralized security protocol that enables the secure transfer of digital assets between blockchain networks. The protocol uses “Keeps,” which are particular purpose smart contracts that act as a bridge between different blockchains.
Keep Network’s key features are its security and privacy-focused design and its use of “Bonded Keeps” to ensure the safety of user assets.
In addition, Keep Network has partnered with Chainlink (LINK), the most widely used decentralized oracle network, to provide reliable data to its users.
With Chainlink, Keep Network can offer its users the ability to connect to off-chain data sources, such as real-world events, data from web APIs, and more.
Keep Network is an essential piece of the DeFi ecosystem and will be a significant player in the market in the years to come.
Unicrypt is a decentralized protocol that enables the creation and management of digital assets. The protocol provides tools that allow users to create, issue, and trade digital assets on the Ethereum blockchain.
Unicrypt’s key features are its user-friendly interface and support for a wide range of digital asset types.
In addition, Unicrypt offers a variety of features that make it an attractive option for users looking to create and manage digital assets. These features include supporting multiple signature schemes, atomic swaps, and more.
Unicrypt is a powerful tool that can be used to create and manage a wide variety of digital assets. The protocol will be a significant player in the DeFi space in the years to come.
The primary objective of DeFi is to create an open, trustless, and permissionless financial market. Notable development and investment are going into the advancement of DeFi, and financial advisors must understand this space. Much of the DeFi technology builds on and enhances the TradFi system, potentially resulting in a better outcome for users. As the space evolves and strengthens, it is critical to understand decentralized finance and be prepared to interact with its projects.