Decentralised Finance (DeFi) coins have found their way into the minds of many cryptocurrency investors and people outside of the crypto community who have a genuine interest in entering it for the very first time. Specifically, the utility and importance of these DeFi coins cannot be ignored or understated.
DeFi platforms have provided users with ways to borrow, save, lend or trade crypto without any traditional bureaucracies found within the financial markets. This level of popularity is making the top DeFi coins a solid option to invest in the eyes of many.
However, with so many projects out there, it can be challenging for newcomers to figure out exactly what is worth investing in and what is not.
To make things easier for you, we have selected the top 10 best DeFi coins you can invest in 2022 before the next boom in decentralised finance through our DeFi coins list.
But, before going over each of these DeFi crypto coins, let’s learn what DeFi tokens are and how they work.
What are DeFi Coins (Governance Token)?
A decentralised finance coin or DeFi coin transfers value in a financial transaction. These types of coins are often built to power their own unique native blockchain networks. These differ quite a bit when compared to traditional finance.
However, DeFi tokens are known due to their various utility in their native networks. For example, some of these DeFi tokens are governance tokens, which grant voting rights as well as management power to the users that hold them.
This means they can also define the rules through which blockchains perform transaction and block verification. These tokens grant power to their holders and the overall community to decide on the future roadmap or any critical features implemented within the network.
This is the true power of DeFi tokens and one of the main reasons they have seen such a high level of growth and popularity.
Each of these tokens powers DeFi protocols, and some even have cross-chain functionalities across different DeFi platforms.
There are even options that let you engage in DeFi farming, otherwise known as DeFi Yield Farming, another appeal of decentralised finance.
Which DeFi coins to Buy in 2022? (Not Financial Advice)
If you are curious about what DeFi coins to watch, this is a list of existing and upcoming DeFi coins worth your attention, all of which are DeFi tokens that power solid DeFi projects.
1. Maker (MKR)
MKR price chart
Maker Market Cap and Total Value locked
Maker has US$16.54 billion in total value locked, with a market cap of US$1,985,847,276, as of January 2022.
What is Maker (MKR)?
Maker (MKR) is a decentralised network that is Ethereum-based. It is an autonomous organization (DAO) that allows anyone to lend and borrow cryptocurrency.
How does Maker work?
As a means of enabling the process of borrowing and lending crypto assets seamlessly, Maker DAO utilizes the Maker protocol to borrow against collateral.
Maker allows its users to borrow against a multitude of different cryptocurrency pairs, all of which are supported by the protocol.
MKR News and Updates
- MakerDao has planned to lower its DAI transaction costs by integrating the Ethereum L2 solution.
- Ambcrypto reported on May 9 that MKR’s investors have lost over 31.4 billion USD in one day.
- As of May 11, MKR price increased by 11% as the investors value more in DAI’s safety than holding UST.
Reasons why you should buy MKR
The main reason why the MKR token exists is to ensure that DAI remains pegged to the dollar. This dual-crypto strategy helps prevent volatility and provides users with more security in the project.
This means that the token brings a lot of benefit to the overall market, which is why it has the potential to always remain relevant and climb in value.
If you had Invested US$1000 in MKR at the start of 2021, how much would it be worth in the beginning of 2022?
On January 1, 2021, MKR was worth US$582.22. MKR is now worth US$2,046.61 as of January 19, 2022. This means if you invested US$1000 in the token at the start of 2021, it would be worth US$3515.2 in January 2022. That is 3.5x in one year, pretty good, right?
2. Curve Finance (CRV)
CRV price chart
Curve Finance Market Cap and Total Value locked
Curve Finance has US$14.08 billion in total value locked in USD, with a market cap of US$1,988,854,676 at the time of writing in January 2022.
What is Curve Finance (CRV)?
Curve Finance (CRV) is a decentralised exchange focused on offering users the opportunity to exchange stablecoins.
How does Curve Finance work?
Curve is a trading platform fully governed by a mathematical feature specifically designed to let stablecoins trade for one another at advantageous rates. Curve allows users to lock up cryptocurrencies so they can be traded by other users.
CRV News and Updates
- CRV has dropped to 1.97 USD on May 9, showing its bearish sign.
- Beincrypto.com reported that CRV has already decreased underneath a short-term descending resistance line.
- Curve Finance has partnered with Near’s Aurora Network which will allocate over 7.5 million USD to the platform.
Reasons why you should buy CRV
CRV is a token developed to serve the role of a governance medium, provide an incentive structure, and be used as a fee payment method.
Therefore, the CRV token has a high level of utility within the project. Still, there is also demand for it, which ultimately results in it remaining valuable and relevant for years to come.
If you had Invested US$1000 in CRV at the start of 2021, how much would it be worth at the beginning of 2022?
On January 1, 2021, CRV was worth US$0.6223. CRV is now worth US$4.42 as of January 19, 2022. Therefore, if you had invested US$1000 in the token at the start of 2021, it would now be worth US$7102.7 in January 2022.
3. Convex Finance (CVX)
CVX price chart
Convex Finance Market Cap and Total Value locked
Convex Finance has US$11.86 billion in total value locked in USD, with a market cap of US$1,899,080,277 as of January 2022.
What is Convex Finance (CVX)?
Convex Finance (CVX) is a DeFi protocol built on top of the stablecoin exchange. It rewards Curve liquidity providers and CRV stakers with additional yield.
How Does CVX Work?
Convex Finance’s platform is run by CRV token holders and Curve liquidity providers. They can earn additional interest rewards and Curve trading fees on their tokens in return.
CVX News and Updates
- According to uk.investing, CVX has seen its 6.32% increase to 21.68 USD.
- On March 5, CVX token flooded the market due to a smart contract bug resulting in a price decrease.
Reasons why you should buy CVX
Decentralized Finance exploded in popularity throughout the past few years and will carry on doing so in the near future as well. CVX is a top-performing token that can maintain its trend and relevancy in the long term.
Because the token can be staked as a means of earning a share of Curve LOP’s CRV earnings, it is a solid recommendation for anyone wanting to create a passive income stream.
If you had Invested US$1000 in CVX at the start of 2021, how much would it be worth at the beginning of 2022?
On May 18, 2021, the first recorded value for the CVX token was worth US$7.0834. The token is worth US$40.85 as of January 19, 2022. This means that if you had invested US$1000 in the token at the start of 2021, it would be worth US$5767 in January 2022. That is equivalent to 576%, very impressive, isn’t it?
4. SushiSwap (SUSHI)
SUSHI price chart
SushiSwap Market Cap and Total Value locked
SushiSwap has US$2.14 billion in total value locked in USD, with a market cap of US$783,641,054 as of January 2022.
What is SushiSwap (SUSHI)?
SushiSwap (SUSHI) is an Ethereum-powered token and platform that enables the exchange of cryptocurrencies through decentralised means through utilizing the automated market maker (AMM) model.
How Does SUSHI Work?
SushiSwap is essentially this software that runs on top of the Ethereum blockchain. It was specifically developed to incentivise a network of users to operate a platform where they can buy and sell cryptocurrency assets. It uses a collection of liquidity pools to achieve this task.
SUSHI News and Updates
- The newly launched SushiSwap2.0 has a restructuring plan after months of internal crisis.
- Based on ambcrypto, the price chart shows that SUSHI will struggle to overcome the bear market.
- Despite the decreasing price, SushiSwap was added to the list of the most used exchange according to investing.com.
Reasons Why You Should Buy SUSHI
SushiSwap as a platform offers DeFi users access to features such as staking as well as yield farming. This is a less labor-intensive way of earning money through the cryptocurrency holding each trader already has, and provides more consistent ROIs. SUSHI’s value has historically increased and will likely do so in the future as well, making it a solid recommendation.
If you had Invested US$1000 in SUSHI at the start of 2021, how much would it be worth at the beginning of 2022?
On January 1, 2021, the SUSHI token was worth US$3.3311. The token is worth US$6.14 as of January 19, 2022. Therefore, if you had invested US$1000 in the token at the start of 2021, it would be worth US$1843.2 at the beginning of 2022. Well not that good, but still better than saving your money in a banking account right?
5. Uniswap (UNI)
UNI price chart
UniSwap Market Cap and Total Value locked
As of January 2022, Uniswap has US$8.29 billion in total value locked in USD, with a market cap of US$9,804,039,151.
What is Uniswap (UNI)?
Uniswap (UNI) is an automated decentralised cryptocurrency exchange built on top of the Ethereum blockchain. UniSwap’s native cryptocurrency token is known as UNI.
How Does UNI work?
Uniswap software was designed to run on Ethereum blockchain. A global network of users is incentivized to maintain and exchange cryptocurrencies bought and sold by traders directly. Uniswap uses a collection of liquidity pools to achieve this task.
UNI News and Updates
- On May 9, Uniswap has dominated Coinbase and Binance in terms of liquidity, as reported by ambcrypto.
- Uniswap has archived about 50% market share on Polygon after a 3-month deployment.
- Uniswap’s DEX will develop the concentrated liquidity on the platform allowing price range customization.
Reasons why you should buy UNI
Through buying the native cryptocurrency token of Uniswap, known as UNI, users can participate in the decisions on how the network operates and benefit from the rising value of the DEX throughout time. This is why it is an important token that needs to be a part of anyone’s portfolio.
If you had Invested US$1000 in UNI at the start of 2021, how much would it be worth at the beginning of 2022?
On January 1, 2021, UNI was worth US$4.7362. UNI is worth US$15.70 as of January 19, 2022. Accordingly, if you invested US$1000 in the token at the start of 2021, by January 2022, it would be worth US$3314.9.
6. Aave (AAVE)
AAVE price chart
AAVE Market Cap and Total Value locked
At the time of writing in January 2022, Aave has US$10.95 billion in total value locked in USD, with a market cap of US$2,926,767,867.
What is Aave (AAVE)?
Aave (AAVE) is an open-source based and non-custodial protocol that allows users to earn interest on deposits and even borrow cryptocurrency assets.
How does AAVE work?
Aave runs on top of the Ethereum blockchain. However, it utilizes a system of smart contracts to enable assets to be managed by a distributed network of computers running its software.
Aave users are not required to trust any central authority or institution and only entrust the code. Moreover, AAVE gets its value due to its finite supply and uses fees to buy AAVE and remove the cryptocurrency from circulation.
AAVE News and Updates
- On May 9, Aave has launched a V3 new update to fix the fundamental issue and develop cross-chain security.
- Aave’s CEO broke the silence for the first time on May 3, after getting temporarily banned by Twitter.
Reasons why you should buy AAVE
Any holder of the AAVE token can get access to numerous advantages. In other words, AAVE borrowers do not get charged with a fee if they take out loans denominated in the token and get a discount on any other fees within the platform.
Additionally, if you want to be a borrower of Aave, you can post the token as collateral which will allow you to borrow more. This utility of the token is what makes it so valuable.
If you had Invested US$1000 in AAVE at the start of 2021, how much would it be worth at the beginning of 2022?
On January 1, 2021, AAVE was worth US$90.35. AAVE is worth US$217.40 as of January 19, 2022. So, if you invested US$1000 in the token at the start of 2021, by the beginning of 2022, it would now be worth $2406.2. That is more than a double in your principle.
7. Compound (COMP)
COMP price chart
COMP Market Cap and Total Value locked
Compound has US$7.81 billion in total value locked in USD, with a market cap of US$1,092,417,164 as of January 2022.
What is Compound (COMP)?
Compound (COMP) is an Ethereum token which serves the role of a governance token for the Compound Protocol.
The Protocol however, is a series of decentralised interest rate markets, all of which enable users to supply and borrow Ethereum tokens.
How Does COMP Work?
Compound is software that runs on top of the Ethereum blockchain. It allows users to deposit cryptocurrencies within lending pools, which borrowers can access.
This way, lenders can earn interest on the assets they end up depositing. Compound rewards a new crypto called cToken once a deposit is made to the lenders.
COMP News and Updates
- S&P Global gave Compound Treasury a B-credit rating on May 9.
- COMP has recently been added on Robinhood, an online brokerage platform resulting in a sharp price rise.
- Compound has received a low risk rating from Investorsobserver analysis on May 10.
Reasons Why You Should Buy COMP
COMP is a cryptocurrency token that will allow anyone to earn additional income through lending or borrowing cryptocurrency.
Users also have a built-in incentive to hold the token as they can make decisions on how the platform will evolve in the future.
If you had Invested US$1000 in COMP at the start of 2021, how much would it be worth at the beginning of 2022?
On January 1, 2021, COMP was worth US$145.39. The COMP token is worth US$172.33 as of January 19, 2022. This means that if you invested US$1000 in the token at the start of 2021, it would now be worth US$1185.3 as of January 2022.
To be real, the Last year 2021 was not a good year for defi. We just have to wait to see what is going to happen when more people and big institutions start adopting Defi.
8. InstaDApp (INST)
INST price chart
INST Market Cap and Total Value locked
InstaDApp has US$6.84 billion in total value locked in USD, with a market cap of US$45,462,133 in January 2022.
What is InstaDApp (INST)?
InstaDApp (INST) is a decentralised application that works on top of the Ethereum blockchain, which integrates DeFi protocol within a single platform to enable easy asset monitoring and management.
How Does INST Work?
InstaDApp is a decentralised application that bridges and connects several different protocols on the decentralised web.
This essentially means that InstaDApp has integrated different dApps into a single application as a means of managing all of their functions.
INST News and Updates
- Longhash Ventures has planned to develop WEB3 game data on Defi platforms including InstaDApp with the capital of 1.5 million USD.
- Uk.sports.yahoo.com reported that InstaDApp has seen a 43% drop in its Total Value Lock in the first week of May.
Reasons why you should buy INST
There were 100 million tokens minted at genesis, which will be released throughout four years. Over half of them, or 55%, are allocated to the community and rewards program.
INST tokens are used to pay for the platform services and the governance process, which means that the community can decide on how the platform is upgraded, and this utility is what gives the token value.
If you had Invested US$1000 in INST at the start of 2021, how much would it be worth at the beginning of 2022?
The first-ever recorded value of INST was on June 19, 2021, when the token was worth US$9.2768. The token is worth US$2.52 as of January 19, 2022. Therefore, if you had invested US$1000 in the token at the start of 2021, by January 2022, it would now be worth US$271.6.
9. Yearn.Finance (YFI)
YFI Price chart
YFI Market Cap and Total Value locked
In January 2022, Yearn.Finance has US$3.81 billion in total value locked in USD, with a market cap of US$1,165,931,508.
What is Yearn.Finance (YFI)?
Yearn.Finance (YFI) is a group of protocols that run on top of the Ethereum blockchain.
The platform’s primary purpose is to enable users to optimize all of their earnings on cryptocurrency assets through lending and trading services.
How Does YFI Work?
Yearn.Finance is built on top of Ethereum and gives users the ability to optimize their earnings on cryptocurrency assets through simply lending and trading services.
There are four products that make up the system, including APY, Earn, Vaults and Zap.
YFI News and Updates
- Yearn.Finance has released a Defi’s friendly yield robot to help users earn easier.
- Yearn.Finance’ creator, Andre Cronje is recently developing RegFi aiming to translate Defi to Tradfi.
Reasons why you should buy YFI
The YFI token is an excellent token that investors can buy since it enables them to diversify their long-term portfolios.
For one, it is a governance token that is distributed exclusively through active participation and liquidity provision. Anyone who owns YFI can receive some of the revenue collected by the protocol in the form of fees.
If you had Invested US$1000 in YFI at the start of 2021, how much would it be worth at the beginning of 2022?
On January 1, 2021, the YFI token was worth US$21,901.97. The token is worth US$31,846.32 as of January 19, 2022. This means that if you had invested US$1000 in the token at the start of 2021, it would now be worth US$1454 as of January 2022.
10. Balancer (BAL)
BAL price chart
BAL Market Cap and Total Value locked
Balancer has US$2.19 billion in total value locked in USD, with a market cap of US109,274,338 as of January 2022.
What is Balancer (BAL)?
Balancer (BAL) is an automated market maker which essentially lets just about anyone create or add liquidity to trading pools, whereby doing so, they can earn customizable trading fees. BAL is the native Ethereum-based tokens that powers Balancer.
How Does BAL Work?
Balancer essentially utilizes a combination of cryptocurrency assets to enable trading without a financial intermediary.
Users are given the opportunity to create funds based on the crypto in their portfolios, where these funds are known as balancer pools. Any user that wants to provide liquidity to a pool can do so by depositing an asset within it.
BAL News and Updates
- Balancer has created bullish divergences over multiple time frames for a short-term double bottom pattern as BAL has broken out from a descending wedge.
- Cointelegraph reported that Balancer has shown a surge in their total value locked despite the current downturn in the wider crypto market.
Reasons why you should buy BAL
The main reason why BAL is a recommended purchase and why investors should buy it is because it is an essential part of the distribution of operations within Balancer’s ecosystem.
It ensures that no central party can make decisions about how it operates. However, it is also an incentive mechanism as users who deposit assets within the Balancer pools can earn BAL tokens.
If you had Invested US$1000 in BAL at the start of 2021, how much would it be worth at the beginning of 2022?
At the start of 2021, on January 1, BAL was worth US$13.93. It is worth US$15.68 as of January 19, 2022. That means if you had invested US$1000 in the token at the start of 2021, in January 2022, it would be worth US$1125.6.
Tips for Beginner before investing in Defi coins
If you are a beginner and this is your first time diving into the world of cryptocurrencies, it is a solid idea for you to start balancing your portfolio.
Remember to only invest a percentage of your income within cryptocurrencies, specifically, an amount you can actually lose, and not worry too much if you do so.
Remember, this is not financial advice, just general tips that you can follow to have a better outcome in the long term.
Bottom Line
Investing in decentralised finance (DeFi) coins can be a brilliant idea for a variety of different reasons.
Remember to do a lot of research on how to invest in DeFi, and go over as many DeFi exchanges as possible. You can also engage in DeFi lending or DeFi Farming but do so at your own risk.
From giving you access to governance rights within the project, you decide to invest in the token’s value growing throughout time and the various use-cases implemented by the projects themselves.
This is an investment strategy that could potentially be worth a lot in the long term. However, remember that this is not financial advice and that it is up to you to decide what your ambitions and personal goals are in terms of investment.
CURATED FROM:
“10 Best Defi Coins to Invest in 2022 [Hidden Gem].” Zipmex, https://zipmex.com/learn/best-defi-coin-to-invest/
