MKR is used to vote on protocol decisions through the Maker voting dashboard and is burned using a portion of Stability Fees collected from outstanding loans. Maker is the decentralized lending protocol responsible for the creation of DAI. Using KNC, users will have the ability to vote (or delegate) on important protocol decisions including the distribution of fees collected from DEX trading. Kyber recently underwent it’s Katalyst tokenomics upgrade, introducing key governance mechanisms through the advent of the KyberDAO. Fees collected from the exchange are largely used to burn KNC. Kyber Network is a leading DEX that captures value through a native token – Kyber Network Crystals (KNC). Here’s a great tool to keep up with which assets are earning the most COMP on any given day.ĭeFi Rate is making a big push to be a Compound delegate, and you can read our bid about why you should consider delegating to us here. COMP is used to govern important protocol decisions that can be voted or delegated on the Compound Governance Dashboard.ĬOMP is allocated to markets relative to the amount of interest accrued, meaning assets that generate the most interest will earn the most COMP per day. Compound – COMPĪs the native governance token behind the leading lending protocol, COMP is earned by users for lending or borrowing assets. SUSHI is also used to vote on new Onsen launch partners, or projects that receive added SUSHI rewards for conducing an Initial DEX Offering through Sushiswap. It is earned by LPs by providing liquidity to select pairs on Sushiswap, and can be staked via the Omaske bar to earn protocol fees and issuance. SUSHI is the governance token of the Sushiswap AMM and lending protocol. Today, UNI can be earned by providing liquidity to select pools and will eventually be used for governance as a larger portion of the supply is issued. In mid-September, Uniswap airdropped 15% of its supply to past users through a program marked ‘ UNIversal Basic Income‘. Uniswap is the leading decentralized exchange in DeFi. Users can stake YFI to participate in governance and claim a pro-rata share of protocol fees. The protocol is governed by a native token – YFI – which was launched with no premine and did not hold an Initial DEX Offering.
YEarn is an automated liquidity aggregator offering a number of different yield farming opportunities. Maintaining this ratio – referred to as a cRatio – allows users to earn native inflation along with a pro-rata portion of trading fees from the Synthetix Exchange. In order to mint new derivatives – called Synths – users must stake at least 750% of the Synths value in SNX. Synthetix is a leading derivatives protocol backed by a native token SNX. AAVE can be staked via the Safety Module for AAVE rewards. Aave is currently undergoing its migration from LEND to AAVE at a rate of 100:1, which you can do through the Migration Portal. Aave – AAVEĪave is a leading lending protocol that leverages a native token AAVE to secure the protocol and participate in governance. To see which DeFi tokens have the highest market cap at any given time, we recommend this awesome tool from DeFiMarketCap. The tokens mentioned on this list are meant to serve as education and should not be treated as investment advice. With all custodial tokens comes an added degree of trust. Outside of DeFi, centralized exchange tokens like FTT (FTX’s token) continue to perform well amidst retail attention, best highlighted by Celsius’s mysterious ecosystem propelling CEL to new ATHs. Meta-governance projects like INDEX will look to play into the conversation while yield farming aggregators like ALPHA look to capture idle ETH for interest-earning vaults. Compound’s choice to build out Compound Chain signals a sign in this direction, and it’s likely that other key governance tokens like BAL will help shape protocol upgrades in 2020. With Synthetix planning to move to L2 on January 15th and Uniswap soon to follow with Uniswap V3, its likely that these governance tokens will play increasingly important roles in their respective ecosystems. There’s a lot of talk around Layer 2 (L2) scalability, especially with gas costs reaching new highs amidst the ETH bull run. The biggest gainers are those of well established blue chips like AAVE and SNX along DEX governance tokens like SUSHI and UNI. DeFi Token Trends for 2021.Īs ETH rises on a steady tear, select DeFi tokens are fighting to keep up with the growth. We recommend using a DEX like Uniswap or Sushiswap to trade any of the tokens mentioned below.
On this page, we take a look at the top DeFi tokens and examine their role within each ecosystem. With DeFi tokens outperforming BTC in 2020, the ecosystem is quickly turning towards popular protocol tokens as a means of value capture for DeFi’s growth.
DeFi has established itself as the top sector for high value tokens.
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