Decentralized Finance (DeFi), protocols have accumulated a total valued locked (TVL figure) figure of $16.1B, and feature a combined market capital of $20B. Many people who were savvy enough and able to take advantage of the new opportunities have become millionaires by investing in major DeFi protocols. We felt it was the right time to introduce five DeFi protocols that have tremendous potential and are likely go higher in the future, with DeFi fever at an all-time high and major developments occurring across.
SushiSwap – $1.16B TVL
SushiSwap, a forked version the famous Uniswap – SushiSwap decentralized exchange is an orderbook-less liquidity provider. It provides better integrations and incentivization with the Yearn ecosystem. This allows it significant capability upgrades, and better long-term value aggregation. SushiSwap allows liquidity providers to earn SUSHI tokens to provide liquidity. It’s also a governance token that ensures that all participants have the opportunity to shape the protocol’s structure and function.
The team was previously criticized for launching the “vampire attack on Uniswap” and for selling millions of tokens for ETH (which were eventually refunded after community backlash). SushiSwap has since changed its course and begun a new chapter. It recently joined the Yearn Finance ecosystem and is now on its way to releasing new products in the future.
YETI – $7M TVL
Yearn Ecosystem Token Index (YETI) – $7M TVL
YETI, an index fund that allows for easy investing in Yearn Finance ecosystem projects, features 8 projects: Yearn Finance (YFI), Sushiswap(SUSHI), C.R.E.A.M. (CREAM), Akropolis, (AKRO), Cover Protocol(COVER), Concentrated voting Power (CVP), Sushiswap (SUSHI), C.R.E.A.M. and Pickle Finance. Each weight is different. It eliminates the hassle of searching for promising projects and investing in them one at a time.
Yearn Ecosystem Token Index, (YETI), automatically purchases the underlying tokens according to the weightage determined through the governance. When ETH, individual tokens or multiple tokens are provided by the user (already part the fund), a clean and intuitive user interface is used. It also allows users stake YETI tokens to increase their profits. It is a simple way to simplify fund management and investment.
Power Pool – $11.8M TVL
Power Index is a fundamental DeFi index fund that is serious-minded and serious. It only uses the most essential, proven and well-tested protocols. The native token is Power Index Pool Token, (PIPT), which derives value form underlying Aave and Yearn Finance (YFI), Synthetix (SNX), Concentrated Volting Power (CVP), Compound(COMP), Wrapped Nexus Mutuals (wNXM), Makers (MKR), and Uniswaps (UNI) in varying amounts. It is also used for governance, staking, and other purposes.
The index fund is an example of an industry benchmark for analysis and investments. Long-term investors will find great value with this index fund. It is easy to invest and it doesn’t require any setup. It works in the same way as YETI and allows you to buy with ETH, individual assets, or all of them. It is best suited for fundamental investors who have a long-term outlook and are looking for value accrual as well as root level investment hypothesis.
Yearn Finance – $421M TVL
Yearn Finance (YFI), the flagship project in the Yearn Finance ecosystem, is not to be missed. It is an automated yield generation protocol that harvests and generates yield. It involves multiple strategies that involve almost all DeFi protocols. Andre Cronje, the developer, launched the project and has already returned over 500x ROI to early investors. It has a strong on-chain governance that includes YFI voting power as well as multi-signature wallets.
Yearn.Finance will launch its v2 version by the end of 2020. It will likely increase the value of the project’s treasury as well as the YFI token beyond their previous all-time highs. A few vaults have been released for the next iteration, and the rest of the deployment is expected to be completed within the next few weeks. Yearn.Finance is easy to recommend due to its developer base and vibrant community.
Cover Protocol – $43.9M TVL
Cover Protocol is an enhanced version of the Nexus Mutual DeFi investment protocols. It protects users from smart contract risks (exploits and hacking, etc.). By setting up a market-determined price for insurance against theft or loss, It does this by providing fungible tokens to peer-to-market. Market makers deposit collateral to obtain claim or no-claim tokens. These tokens can be staked for yield, or sold for premium to coverage seeker.
Although Cover Protocol is a new project, it has great potential to challenge Nexus Mutual. It offers a more flexible design and features that Nexus Mutual’s predecessor. The protocol has seen rapid growth in TVL, COVER token price appreciation. DeFi is still a young field, with many risky experiments and untested codes, and the insurance industry will thrive in this environment. Cover Protocol will likely reap the benefits.