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DeFi itself is so new that it may be a little early to crown any DeFi project as “DeFi Blue Chips”. Nevertheless Cryptocoin. com

As , we will now focus on 10 DeFi Blue Chips altcoins that can be considered as “blue chips”. Before these, it is necessary to dwell on Solana.

The rise of Solana

Solana’s DeFi ecosystem is growing rapidly. Several high-end projects are vying to become the network’s blue chips. By using these protocols early, users want to take their position before the ecosystem develops. The smart contract platform’s DeFi ecosystem would be padlocked after Solana’s sudden price spike. While many new projects are taking place in Solana, there are countless opportunities to benefit from rapid growth.

DeFi Blue Chips altcoins

While Solana has grown in caddies over the summer, Ethereum is still the undisputed home of DeFi in the crypto space. Following the “DeFi summer” of 2020, a handful of top projects have established themselves as DeFi “blue chips” on Ethereum that encompass the functions of traditional financial markets in the decentralized space. However, the cost of using DeFi on Ethereum today has upset many users. While Tier 2 solutions such as Optimism and Arbitrum promise to reduce the cost of using the network, progress has been slow. Therefore, other Tier 1 chains like Solana are well positioned to take some of the DeFi market share from Ethereum.

Solana has all the features for a promising DeFi-focused Tier 1. Fast block times and a Proof of History mechanism prevent pre-execution, and node scalability means the network can theoretically avoid congestion and keep transaction costs low. With this in mind, Solana is well on its way to developing its own thriving DeFi ecosystem. Several DeFi projects are currently competing to become Solana’s DeFi blue chips. By identifying potential projects, users can take advantage of early adopters and all the benefits that come with it, such as airdrops, liquidity mining and more.

Potential DeFi Blue Chips

Two of the biggest DeFi blue chips on Ethereum are Compound and Aave. Both of these protocols act like decentralized banks and allow users to deposit assets to earn interest and use assets as collateral for borrowing. Advanced yield farmers often use Compound and Aave as the base layer to stack “money legos” to borrow assets for additional yields in a variety of DeFi protocols.

Port Finance and Solend are two Solana-based projects competing to act as decentralized banks. Port Finance is currently the 11th largest dApp in Solana according to DeFi Llama, with a total key value (TVL) of approximately $122 million. The port works the same as Compound and Aave and currently supports USDC, USDT, and PAI stablecoins, as well as a few Solana-specific assets like Serum. The port is currently running a liquidity mining program where users can earn PORT, the protocol’s governance token, in addition to the interest paid on the invested asset.

https://twitter. com/port_finance/status/1435878743298306050

Solend is another of Solana’s DeFi banks. With a lower TVL of $64.4 million, Solend is currently the 13th largest Solana dApp. With the addition of Raydium and Ethereum, it has many of the same assets as Port and allows users to borrow against a wider variety of assets. Solend has yet to issue a management token, but has confirmed that a token will be introduced in September through a liquidity mining program. The rewards of the program will be retroactive, so using the protocol early can provide an added bonus.

Another major DeFi element of Ethereum is Curve Finance, a stablecoin-focused decentralized exchange. On Curve, users can efficiently exchange stablecoins, such as stablecoins and wrapped assets, with a range of low transfer fees. In Solana, the request to trade stabled assets is handled by Saber, the protocol with the highest TVL available in the network. Saber offers a large number of stablecoined asset pairs such as USDC-USDT, staked and unstacked SOL, and BTC-renBTC. In addition to trading assets, users can also provide liquidity to earn interest. Unlike most liquidity pools on Ethereum dApps, Saber’s pools do not require the user to deposit an equal amount of both assets. While the rate of return fluctuates based on the amount of liquidity provided and pool usage, users can expect to earn 3% to 10% APY on Saber. However, the opportunity to generate returns does not end there.

Sunny project

After users receive their liquidity provider (LP) tokens, they can transfer them to the yield collector Sunny to earn extra rewards. Users can earn SBR to provide liquidity in Saber, and the Sunny aggregator also pays out SUNNY tokens with a variable APR depending on the liquidity pool. This additional layer of returns is already highly exploited with around $1.4 billion of Saber LP tokens invested in Sunny, giving it the second highest TVL in Solana.

While a variety of DeFi opportunities are available on Solana, many users choose to stake their SOL for a return that ranges from 6% to 8%. Once staked, funds are illiquid, meaning they are locked and cannot be traded or deposited in other DeFi protocols. However, an activity known as liquid staking allows users to generate a non-lockollar synthetic asset representing the staked SOL. This allows users to access additional returns opportunities while simultaneously determining their SOL.

Marinade Finance fills this gap in the market by allowing users to stake their SOL and receive mSOL in return. mSOL is SOL that is tradable and can be used on other DeFi platforms to earn additional returns. For example, a user can leverage Marinade’s liquid stock to earn 6% to 8%, then invest their mSOL in Saber’s SOL-mSOL liquidity pool to earn additional returns.

Another blue chip Maker DAO

Another Ethereum blue chip to get the Solana equivalent is MakerDAO. The Maker protocol allows users to deposit certain cryptocurrencies into vaults and issue DAI stablecoins equivalent to the value of the deposited asset. The result is a decentralized, collateral-backed cryptocurrency softly pegged to the US dollar.

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Like MakerDAO, Solana’s Parrot Finance allows users to lock their holdings and issue the PAI stablecoin in return. In addition to investing single assets such as SOL, SRM or RAY, LP tokens from Saber can also be used as collateral for mint PAI. Parrot currently has a cap on the amount of PAI that can be printed, but these restrictions are likely to be lifted as the platform grows and demand stabilizes. Recently, Parrot entered a dual liquidity mining program with Port Finance, allowing users to deposit PAI and pSOL, earning both PRT and PORT tokens in addition to regular interest.

Another of Solana’s popular DeFi projects is Orca, an automated market maker (AMM) for exchanging assets on Solana. While Solana already offers ways to modify assets like Serum and Raydium, Orca refines the AMM experience and offers a number of upgrades. Before providing liquidity to the protocol’s pools, the amount of tokens earned per $1,000 is displayed, making it easy for users to predict their rewards. Additionally, when confirming transactions, Orca pulls data from price monitors on CoinGecko, alerting users if rates or slippage are higher than expected.

With all the lucrative opportunities to generate returns in the Solana ecosystem, the network looks set to attract more capital in the coming months. Getting involved early can often pay dividends, as with many DeFi protocols on Ethereum. Although SOL’s price seems overheated at the moment, the thriving ecosystem in Solana is here to stay.


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Michael Lewis

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