update 6 October 2021

Top DeFi (Decentralized Finance) Coins to Trade on OKEx

Blockchain technology has brought with it numerous innovations, one of them being Decentralized Finance (DeFi). DeFi platforms are the next-generation of financial primitives set to transform “traditional” financial services such as borrowing, trading, lending, payments, and investing. These platforms employ open-source software and composable frameworks, i.e., smart contracts to offer financial services with no border limitations and in a trustless and transparent manner with no intermediaries present. 

DeFi is among the hottest topics in the blockchain space this year. Over 200 DeFi platforms in the blockchain space deal with staking, borrowing, lending, trading, investment, and custodial services. DeFi platforms have over USD 1 billion worth of assets locked in them, with lending platforms being the most profitable.  

This article will look at the leading DeFi coins to trade on the OKEx exchange

DeFi Explained

Decentralized Finance (DeFi) is a term used to describe any financial service, i.e., lending, trading, wealth management, interest income, custodial services, collateralized loans, and investments, etc. provided without a centralized intermediary and through trustless protocols. These financial services are also offered without border limits; thus, anyone worldwide can access DeFi platforms via the internet.   

DeFi seeks to integrate blockchain technology into the financial world to provide a globally inclusive financial system without centralized actors. DeFi creates a low-risk, safe, and friendly crypto environment for institutional investors and the general public to adopt cryptocurrencies, hold their assets, and yield interest.

Top DeFi Coins to Trade on OKEx

Chainlink (LINK)

Launch: 2017

Token: LINK  

Service: Interoperability   

Blockchain: Ethereum 

Chainlink is a decentralized oracle platform that seeks to bring interoperability to blockchains’ world by providing reliable tamper-proof inputs and outputs for complex smart contracts on any blockchain. The protocol offers blockchain networks with price feed data collected from sources both on and off blockchains. 

Chainlink aims at decentralizing the internet to create a link between blockchain and its real-world applications. Smart contract users can leverage the network’s oracles to retrieve data from off-chain APIs, data pools, and other resources then integrate it into the blockchain. Simply put, Chainlink integrates real-world applications into blockchain networks via APIs.  

The collected off-chain data is aggregated and verified to prevent tampering with the oracles rewarded with LINK. A notable Chainlink use case is that it allows users to send payments from their smart contract to bank accounts and payment networks. 

Chainlink is based on the Ethereum blockchain and supports connectivity to other Ethereum-based platforms, including DeFi and Dapps. It looks to support more blockchain in the future to allow for the seamless interconnectivity between data, financial and other platforms. 

Compound (COMP)

Launch: 2018 

Token: COMP 

Services: Borrowing and Lending 

Blockchain: Ethereum 

Compound Finance is an Ethereum-based, open-source money market protocol that enables users to borrow or lend crypto against collateral. The platform describes itself as “an autonomous interest rate protocol built for developers, to unlock a universe of open financial applications.” 

Compound also strives to solve the negative yield (depreciation) of holding digital assets on both on-exchange and off-exchange due to substantial storage costs and risks. Compound’s protocol allows digital assets holders to enter a liquidity pool and earn interest in digital asset holdings. 

The interest rates are automatically determined using algorithms involving the supply and demand on the platform. Interest rates range from 2-8% on three stablecoins: Ether, DAI, and Tether. Compound also supports BAT, ETH, REP, USDC, and ZRC as currencies. 

Compound is compatible with Ethereum-based wallets, including Metamask, Coinbase, and Ledger. Lenders and borrowers can directly access the protocol via their Ethereum wallets, thus eliminating third parties’ needs. 

The Compound protocol currently has $ 1 206,975,185 of assets earning interest across nine markets. It’s presently the leading decentralized lending platform in the blockchain space. 

dYdX (dYdX)

Launch: 2018 

Token: dYdX

Services: Derivatives Trading 

Blockchain: Ethereum 

dYdX is a non-custodial, Ethereum-powered margin trading platform designed for advanced or experienced crypto traders. The platform offers traders permissionless lending and margin capabilities involving ETH, DAI, and USDC. Currently, traders can trade ETH using the stablecoins DAI or USDC with up to 5x leverage and no trading fees.

In addition to derivative margin trading, dYdX enables traders to borrow and lend crypto. Lenders can earn up to 5.10%, while borrowers can pay as little as 0.51% interest p.a. (depending on the asset)   

dYdX currently has over $20 million of Ethereum-based tokens in the protocol. 

Polkadot (DOT)

Launch: 2017 

Token: DOT 

Service: Interoperability

Blockchain: Polkadot 

Lack of blockchain interoperability is a major hindrance to mainstream adoption. Polkadot is a multi-chain technology that offers blockchain interoperability by enabling cross-blockchain transfers of any data or asset, not just tokens. The platform connects private and public blockchain networks and other networks in the Web 3 ecosystem, allowing the safe and seamless sharing of any data and digital assets. 

Polkadot also provides transactional scalability by spreading transactions across multiple parallel blockchains. The platform employs user-driven network governance and can upgrade without hard forks, quickly adapting to the changing blockchain environment.

Polkadot’s mission is to transform the existing Web 3 internet structure into a completely new, interoperable, decentralized web with trust-free transactions. It allows all kinds of blockchain to talk to each other, transact, and exchange data. The platform was launched in 2017 via an ICO, which raised over $145 million. 

Set Protocol (Set)

Launch: 2019 

Token: Set 

Service: Digital Asset Management 

Blockchain: Ethereum  

The Set Protocol is an Ethereum-powered platform that enables users to invest in baskets of tokenized assets. On the platform, users can either create and/or buy Strategy Enabled Tokens (Sets). Sets are algorithmically structured baskets of digital assets based on a range of criteria, strategies, parameters, and asset weightings. A tradable ERC20 token represents each Set. 

In simple terms, Set Protocol offers access to profitable trading strategies that are purchased using ERC20 tokens. Users hold unique tokens, which are automatically rebalanced relative to the intended trading strategy. 

Set Platform also offers social trading enabling advanced traders to tokenize and benefit from their trading strategies. Set total market value is currently over $5 million. 

Conclusion

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price
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The rapid growth in the DeFi sector is a clear indication of how blockchain technology is transforming “traditional” finance. Thanks to DeFi platforms, decentralized, borderless, and open finance services are now possible. Some DeFi platforms offer interoperability solutions, which are crucial for mainstream crypto adoption. OKEx exchange offers a secure and reliable platform for trading DeFi coins. Going forward, DeFi platforms would continue to open doors for transparent and decentralized financial services.

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