Dear Happy Investor, in this article we examine 5 of the best Defi coins with long-term potential. First, we explain what Defi crypto means. We also provide tips on how to find best Defi crypto coins on your own. And finally, we look at the 5 Defi coins with long-term potential.
On to financial independence!
What Are Defi Coins?
Defi coins are a type of cryptocurrency that is specifically designed to be used on decentralized finance (Defi) platforms. Defi platforms are decentralized versions of traditional financial services, such as lending and borrowing, that exist on the Ethereum blockchain. Because Defi coins are built on Ethereum, they can take advantage of the security and transparency of the Ethereum network. In addition, they are not subject to the fluctuations of the traditional financial markets. Over this, these coins offer unique features such as DeFi DApps, which allow users to access a wide range of decentralized applications directly from their wallets.
Defi coins also offer high yield farming and staking opportunities to users. By participating in these activities, users can earn a passive income in the form of interest on their investments. Moreover, Defi coins often offer attractive incentives to users who provide liquidity to the network, such as discounts on trading fees. As a result, Defi coins can be an attractive option for those looking to generate a passive income from their cryptocurrency holdings. However, it is important to note that Defi coins are risky investments, and beginners should only invest what they can afford to lose.
How to Find Best Defi Coins?
What are the best Defi coins to invest in? This is a question that many people ask when they are looking for ways to make money in the cryptocurrency market. There are a lot of different options out there, but not all of them are created equal. That’s why it’s important to do your research and find the best ones before investing any money.
- One of the first things you need to look at when you’re trying to find the best Defi coins is the team behind them. The team should be composed of experienced individuals who have a good track record in the industry. You can find this information by looking up their LinkedIn profiles or checking out their websites.
- Also, you want to make sure that the Defi coin has a good use case. That is, it should be solving a real problem that people are facing. If a Defi coin doesn’t have a good use case, then it is likely that it will not be successful in the long run.
- Another thing you want to look at is the technology behind the coin. The team should be using cutting-edge technology that will help the coin to grow and succeed. You can find this information by reading whitepapers or blog posts from the team. Be careful: there is a lot of scam and false promises!
- Finally, you want to make sure that the coin has a good community behind it. The community should be active and engaged in helping the coin to grow. You can find this information by looking at forums or social media groups.
If you take the time to look at these factors, you’ll be able to find the best Defi coins to invest in. Just remember to do your own due diligence before investing any money.
5 of the best Defi Coins in 2022
Below we will examine 5 of the best defi coins in 2022.
1. Maker (MKR)
Maker is one of the most well-known and best Defi coins at this moment. It is the native token of the MakerDAO protocol, which is a decentralized lending platform built on Ethereum. On the MakerDAO platform, users can collateralize their crypto assets to generate Dai, a stable coin that is pegged to the US dollar.
The value of the MKR token is closely tied to the success of the MakerDAO protocol. As more people use the platform and generate Dai, the demand for MKR will increase, driving up its price. This is an argument for Maker's long-term potential as the best Defi coin.
MKR holders have a say in how the network is run and can help to keep it stable. The token has a high price due to its utility and scarcity, making it an attractive investment for those looking to get involved in the world of cryptocurrency.
2. Aave (AAVE)
The AAVE protocol is designed to provide an open and transparent marketplace for borrowing in crypto. In return, investors can reap interest payments as well as enjoy the security that their investments won't go down the drain with APIs ranging from 2% to 8%.
The AAVE token is one of the best Defi coin that has been leading in terms of market capitalization and value. This innovative funding mechanism allows borrowers access to instant liquidity, while also requiring them to put up security deposits. By the time 2020 rolled around, you would have paid just 53 dollars for an AAVE token. But by 2022, the price had gone up nearly 400%. Don't let this distract you, however, because it can also drop just as fast again.
The AAVE token is a way for people with good credit to get access to not only the best loans but also discounts on all other fees within this platform. There's no fee if you take out denominated in tokens and there will always be an option of how much interest rates should apply so it can easily fit any budget. Aave shows potential to be best Defi crypto right now. Its future potential depends on growth in users.
3. Uniswap (UNI)
In our view, Uniswap is one of the best Defi coins with long-term potential. The decentralized Uniswap exchange is a breath of fresh air in an industry that has been dominated by large centralized exchanges such as Binance and Coinbase. Uniswap is a decentralized exchange protocol that allows traders to swap ERC20 tokens on a peer-to-peer basis. In other words, in buying and selling crypto assets via Uniswap, no centralized party is required. This makes it a key player in the DeFi space as it provides a trustless way to trade cryptocurrencies.
The Uniswap platform is powered by an automated market maker - or AMM, model. In its most simple form, this allows for smooth trading in cryptocurrencies with minimal hassle and no need to worry about Capital Raising Falls.
The project's native Defi coin UNI is a top-25 digital asset for market capitalization. When it first launched on public exchanges in 2020, you would have paid around $7 per unit of currency.
The price of UNI has shot up over 140% in year-to-date 2022. While this is a strong number, investors will be looking for more return on their investments and the $40+ region that it hit last year.
4. Terra (LUNA)
It's been a tough year for cryptocurrencies and blockchain projects in general, but one coin that continues to perform well is Terra. A decentralized finance project with an algorithmically stable token called LUNA (which can be traded between users). This cryptocurrency has seen immense growth from its $0.30 price tag at the beginning of January all while remaining immunity against market fluctuations like those we've seen lately.
The introduction of a full range of national currencies is more powerful than just focusing on major ones. With this coverage, Terra can effectively hedge against risks from any currency's value fluctuations and provide greater security for traders. The input doesn't advocate anything different in regards to how they evaluate their product but rather presents facts about what makes the coin unique.
The value of the Defi coin has skyrocketed since it first became available for purchase in 2019. In just two years, this cryptocurrency is now worth over $90 as per exchanges like CoinMarketCap. It is hard to believe that in less than three years of trading, Terra has increased by over 6800%. The returns would have been even higher if you were able to execute some successful trades. However, investing in crypto is not that simple, and no one knows for sure if the best Defi coins will also rise in the future.
5. Yearn.Finance (YFI)
By eliminating the need for a centralized middleman, Yearn.finance is able to provide P2P-style loans with no commissions involved. It offers a new way for people and businesses to access capital without having any credit history - all through the power of cryptocurrency.
The service is affordable, safe, and easy to use with no long waiting periods or hefty interest rates. It's backed by smart contract technology which means you can borrow money at today’s prices using YC coins as collateral.
Yearn.finance provides an investing opportunity with huge returns on offer. Investors can provide liquidity for trading pairs and earn far higher interest rates compared to banks or financial institutions. You don't need any technical knowledge whatsoever because all trades happen seamlessly through an intuitive interface. Yearn.finance is also among the best Defi coins at the moment in our opinion.
What do you think of the best Defi crypto? Do you see long-term potential or is and will it remain pure speculation?
We at Happy Investors invest for the long term in ETFs and stocks. However, we do have a small position of up to 2.5% in some of the potentially best crypto coins.