Unlike traditional financial services that are accessible to customers based on specific criteria, DeFi applications are open to anyone with an internet connection.
As a result of its use cases and benefits, the DeFi ecosystem has grown so rapidly that it has become hard to keep track of all the projects that are emerging.
This article lists some of the most useful DeFi solutions to help you easily navigate the ecosystem.
Infrastructure projects in DeFi
Infrastructure projects encompass all the frameworks, protocols, and underlying technologies that go into making and launching decentralized applications (dApps). Infrastructure projects can be divided into multiple subcategories:
Layer-1 blockchains are distributed ledgers that store records of transactions on a network of special computers, called nodes, instead of a centralized server. They use cryptography to secure these records and ensure their immutability. They are also the foundational infrastructure for the DeFi ecosystem.
BNB chain: BNB chain is a combination of the Binance Beacon chain and the Binance Smart Chain (BSC). It aims to create an infrastructure that enables interoperability so it can support large-scale applications.
Cosmos: Cosmos defines itself as the internet of blockchain. It consists of an ever-expanding ecosystem of blockchains that connect using Inter-Blockchain Communication (IBC) protocol.
Harmony: Harmony is a secure and fast blockchain built to address Ethereum’s scalability challenges.
Layer-2s and sidechains
Polygon: Polygon is an EVM-compatible Ethereum sidechain that allows you to build scalable, user-friendly dApps with low transaction fees.
Optimism: Optimism is an “optimistic rollup” that helps build scalable DeFi solutions. It achieves this by processing transactions off the main chain and then packaging (rolling up) the data of all verified transactions to send it to the Ethereum mainnet.
Arbitrum: Arbitrum is another layer-2 solution that uses optimistic rollup technology to increase the scalability of the Ethereum mainnet.
Asset tokenization services
Asset tokenization services help create digital tokenized representatives of physical or digital items. These tokens are stored on the blockchain and thus have immutable and provable identity and scarcity.
Tokeny: Tokeny enables you to tokenize debts, funds, private equity, and real estate easily.
Polymath: Polymath is a platform that helps create and manage regulatory-compliant security tokens.
CodeFi: CodeFi is an end-to-end digital asset tokenization, issuance, and lifecycle management platform for financial products like bonds and funds.
Vertalo: Vertalo helps tokenize private assets like real estate and infrastructure so they can be publicly listed and traded on exchanges.
OpenLaw Finance: OpenLaw Finance creates legally-compliant tokenized stock options which you can distribute to employees based on a vesting schedule.
Dibbs: Dibbs is a tokenization as a service (TaaS) platform that helps Web2 and Web3 companies tokenize their physical assets.
Data services are a crucial part of the DeFi infrastructure. To best understand data service platforms, we divide them into four subcategories.
Storage and computing
Decentralized storage works similarly to centralized storage — you upload files via the internet to a server and if you need to retrieve the file, you send a request to the server.
Instead of relying on a centralized server, however, decentralized storage solutions, much like blockchains, rely on multiple computers to create a distributed server.
Areweave: Areweave is a decentralized storage system that works as a collectively owned hard drive. It makes information permanence sustainable through continuous backups.
Filecoin: Filecoin uses cryptographic proofs to guarantee that your data remains available and unchanged over time. The network also creates strategies to suit your needs in redundancy, retrieval speeds, and cost.
Storj: Storj allows you to securely store your data online on more than 13k nodes and easily retrieve them whenever you need.
Blockchains are ledgers that maintain a public record of all transactions. For DeFi applications to get this information in an organized manner, however, they need indexing services, which are computer scripts to search for information in a blockchain.
The Graph: The Graph is a decentralized indexing platform that allows you to process, index, display, and use data from blockchains using open APIs called Subgraphs.
Aleph.im: Aleph.im is a blockchain-agnostic indexer that allows your dapp to access on-chain data with just a few lines of code.
Blockchains are highly efficient systems but they cannot communicate or understand data from outside of their ecosystem. Oracles are software that help blockchains retrieve data from the outside world and make decisions based on that data.
Band Protocol: Band Protocol is an open-source oracle that provides reliable data to DeFi and other services on the blockchain.
DIA: DIA taps into data from crypto exchanges living on different blockchains. And it serves both layer-1 and L=layer-2 networks.
ZapOracles: ZapOracles allows DeFi protocols to access off-chain data through queries or subscriptions.
Communication protocols help DeFi developers send push notifications to their dApp users, thus improving user experience and getting users to spend more time on their platform.
Push Protocol: Push Protocol, previously known as Ethereum Push Notification Service (EPNS), is the first Web3 notification protocol that enables DeFi protocols to send real-time push notifications to users for critical events such as loan liquidation, trade execution, airdrops, and more.
Alchemy Notify: Alchemy Notify enables DeFi protocols to send push notifications to their users on their smartphones.
Cross-chain bridges help users transfer assets across different blockchains easily. They improve the interoperability of the DeFi ecosystem and give users exposure to multiple blockchain environments with a single asset.
Celer Bridge (cBridge): cBridge supports the transfer of 110+ tokens across more than 30 blockchains.
RenBridge: RenBridge converts digital assets on one chain into wrapped tokens on another chain, thus enabling users to access DeFi ecosystems across multiple blockchains. One of its most popular wrapped tokens is the RenBTC, which is a version of wrapped Bitcoin (WBTC).
Synapse: Synapse allows you to move assets across multiple blockchains at high speeds and low costs.
Li.Fi: LiFi is a cross-chain bridge aggregator that brings together multiple blockchain bridges into a single interface and creates a smooth bridging experience.
Crypto on and off-ramps
Crypto ramps are services that allow you to convert fiat currencies into crypto or vice versa. The former is called an on-ramp service while the latter is called an off-ramp service.
Both on-ramp and off-ramp crypto services are important as they connect legacy financial systems to the DeFi ecosystem and bring more users into Web3.
MoonPay: MoonPay is a non-custodial crypto on-ramp and off-ramp service that allows you to purchase and sell 100+ cryptocurrencies. You can buy cryptocurrencies through card transfers or mobile payments like Google Pay, Apple Pay, etc.
Coindirect: Coindirect allows you to buy and sell more than 40 cryptocurrencies and partake in cross-border payments across a wide range of countries.
Transak: Transak is a compliance-driven crypto on and off-ramp service that allows 100+ applications across 75+ blockchains onboard users from fiat to crypto.
DeFi development tools
Protocol development platforms offer a wide range of development solutions, software development kits, and APIs to build robust DeFi applications.
Alchemy: Alchemy is a reliable and scalable development platform with a wide range of SDKs and APIs to help build robust DeFi applications.
thirdweb: thirdweb offers a complete Web3 development framework including highly reliable RPC APIs, SDKs, and ready-to-deploy smart contracts.
Moralis: Moralis is popular for its enterprise-grade APIs and offering real-time blockchain data to decentralized application
Stablecoins are crypto assets whose values are pegged to the value of a relatively stable asset like gold or fiat currency. This allows stablecoins to resist the volatility of cryptocurrencies and offer users a stable store of value in the short term.
Most popular stablecoins are currently pegged to the price of a U.S. dollar, thus trading at a 1:1 ratio with USD.
USD Coin (USDC): USDC is a U.S. dollar-pegged stablecoin that is managed by a consortium dubbed Center, which includes members like Coinbase and Bitmain. USDC is available on Ethereum, Algorand, Avalanche, Flow, Solana, Stellar, and a range of other chains.
DAI: DAI is a decentralized stablecoin that maintains a value equal to the U.S. dollar. It is widely popular in DeFi as a base currency for exchanges.
Binance USD (BUSD): BUSD is a stablecoin managed by the Binance exchange, and it is available across 30+ blockchains.
Blockchain explorers are platforms where users can explore a variety of data and insights related to all the transactions that happen on a blockchain. They’re a crucial part of the DeFi ecosystem as users can use these platforms to analyze smart contracts, check transaction status, and get other DeFi insights.
Blockchain.com: Blockchain.com allows users to check data on the Ethereum and Bitcoin networks.
Etherscan: Etherscan enables you to search for block information, smart contracts, and all transactions on the Ethereum blockchain.
Polygon Scan: Polygon Scan supports searches for Polygon transactions.
BscScan: BSC Scan lets users explore transaction activities on the BNB Chain.
CoinMarketCap: Apart from offering an overview of the crypto ecosystem, CoinMarketCap also has a multi-chain blockchain explorer.
To learn more about the blockchain explorer Etherscan, see our article What is Etherscan and how do you use it?
Compliance and identity
Compliance and identity protocols help build a more secure DeFi ecosystem and let users and protocols adhere to regulatory compliances.
Elliptic: Elliptic aims to bring compliance to crypto assets by offering blockchain analytics, training, and certification for crypto businesses, financial institutions, and regulators.
Civic: Civic is an online digital identity management platform that allows identity verification of users across dapps, DAOs. or DEXs.
Chainalysis: Chainalysis is a compliance and security platform that helps DeFi protocols alongside enterprises and governments to keep users and their funds safe.
Investments, marketplaces, and liquidity platforms in DeFi
Crypto exchanges help you swap fiat currency for crypto or trade one crypto for another. There are primarily two types of exchanges: centralized exchanges and decentralized exchanges
Centralized exchanges (CEX)
Centralized exchanges (CEXs) conduct trades on your behalf and manage your assets through a custodial wallet.
Binance: Binance is the largest crypto exchange platform and enables you to trade more than 600 crypto assets.
Coinbase: Coinbase ranks among the most trusted crypto exchanges in the U.S. and is also quite popular in other parts of the world.
Kraken: Kraken allows you to exchange more than 185 cryptocurrencies through a user-friendly interface.
Gemini: Gemini is a secure and compliant CEX that allows you to exchange crypto, manage assets, and analyze your trades easily.
Crypto.com: Crypto.com is a platform that supports the trading of almost all cryptocurrencies and derivatives like futures and perpetuals.
Decentralized exchanges (DEX)
Decentralized exchanges (DEXs) are non-custodial platforms and they allow you to retain complete control over your assets and trades. They are the better choice for traders looking to trade less popular tokens.
Uniswap (V3): Uniswap is a multi-chain DEX and the most popular option in the Ethereum DeFi ecosystem.
1Inch: 1inch is a DEX aggregator that instantly analyzes multiple DEXs to optimize your trades and give you the best conversion rates.
Balancer: Balancer is a DEX and portfolio management platform wrapped into one. It allows you to trade tokens and also automatically routes trades of less popular tokens through multiple pools to reduce your transaction costs.
Curve: Curve only accommodates pools with similarly behaving assets like stablecoins so you can exchange tokens with low fees and low slippage.
Lending and borrowing
With DeFi lending platforms, borrowers can get loans in exchange for crypto collateral without going through the complex procedures associated with traditional loans.
As for lending, you can deposit your cryptocurrency into a lending pool and receive tokens representing your share in the total value of the pool. Thereafter, when someone takes a loan from your pool, you earn interest from it.
Aave: Aave is a decentralized lending and borrowing platform that allows users to participate as suppliers or borrowers. While suppliers can earn a passive income, borrowers can attain over-collateralized or under-collateralized loans.
Compound: Compound is a borrower-friendly lending platform as it offers fair interest rates and gives you ownership over your collateral.
Yield Protocol: Yield Protocol supports multiple collateral types and allows you to borrow assets against fixed interest rates for up to one year.
Maple Finance: Maple Finance allows organizations to get undercollateralized loans to optimize their working capital.
Liquity: Liquity collects a small one-time fee instead of interest to sanction a loan against ETH as collateral.
Augmented Finance: Augmented Finance is a multi-chain lending and borrowing platform that allows you to lend and borrow assets across multiple chains.
DeFi insurances protect you from potential losses due to accidents like smart contract exploits and hacks. Unlike centralized insurance providers who take a long time to verify claims because of convoluted processes, decentralized insurance providers hold a vote or use third-party oracles to verify a claim in the shortest time possible.
InsurAce: InsurAce protects more than 130 protocols and has paid out $11.6 million in insurance claims so far. You can contribute to the application and earn rewards by verifying a claim, staking coins in it, or providing referrals.
Nexus Mutual: Nexus Mutual helps you stay protected against smart contract attacks and exchange hacks with its smart contract covers. The platform is community-driven and all claims are verified by members via votes.
Opium Insurance: Opium Insurance offers protection against many types of risks including smart contract risks, credit default events, impermanence loss, etc. You can buy premiums on this platform for these risks or even sell them when you no longer need them.
Solace: Solace offers insurance against common DeFi attacks like reentrancy attacks, math errors, and flash loan attacks for organizations. It also offers a portfolio insurance option to protect individuals against attacks.
Nsure: Nsure is an open insurance platform that allows risk outsourcing and underwriting.
Union Finance: Union Finance’s insurance premium helps users pay off a portion of their loan so the DeFi lending platform doesn’t liquidate their collaterals.
Derivatives are a type of financial instrument that derive their value from underlying assets or events such as the outcome of a match, election, etc.
The former is called an asset-based derivative and the latter is an event-based derivative or prediction market.
Synthetix: Synthetix enables users to create and trade synths — tokenized derivative assets voted into existence by the community— by staking SNX tokens.
Mirror Protocol: Mirror Protocol gives users exposure to real-world stocks through mirrored assets (mAssets) which reflect the actual price of the stock on-chain.
dYdX: dYdX is a derivatives exchange that supports trades of perpetual contracts.
Augur: Augur is a platform to buy and sell stakes in outcomes of real-world events like sports and politics.
Asset management tools help with the secure management of crypto assets and allow users to monitor their assets’ performance through an easy interface.
A crypto wallet is a software application used to store, send, and receive crypto assets. There are two main types of crypto wallets: cold wallets and hot wallets.
Cold wallets are usually physical devices that store your private keys offline to prevent them from being hacked or controlled remotely.
Ledger Nano: Ledger Nano wallets allow you to store over 5,000+ crypto assets securely and also swap, stake, and send them easily using the Ledger Live application.
Trezor: Trezor hardware wallets store your keys offline and come with a desktop app for managing assets.
NGRAVE: NGRAVE is a cold wallet that claims to offer the highest security-certified OS (EAL 7) in the world. It’s 100% offline and doesn’t support USB, WiFi, or Bluetooth connections to keep your crypto assets safe.
Unlike cold wallets that are disconnected from the internet, hot wallets store your private keys online and are connected to the internet. While they aren’t the most secure way to store your assets, they offer better connectivity to DeFi protocols.
Coinbase Wallet: Coinbase Wallet, developed by Coinbase, is a non-custodial wallet that allows you to securely store and manage ERC-20 tokens and NFT collections.
Exodus: Exodus is a multi-chain wallet that allows you to manage and exchange 240+ cryptocurrencies and NFTs on your desktop or mobile.
Phantom: Phantom allows you to store, send, receive, and swap crypto assets on the Solana blockchain for low transaction fees.
Trust Wallet: Trust Wallet supports more than 65 blockchains and it’s available as a mobile app on Android and iOS.
Argent: Argent is a Layer-2 wallet that enables you to buy, earn, trade, stake, and store tokens in a fast and secure manner.
DeFi dashboards are programs that help you track your crypto portfolio and monitor profit and loss.
Zapper: Zapper allows users to track their portfolio, analyze transactions, and discover trending DAOs, DeFi projects, and NFTs across EVM-compatible chains.
Zerion: Zerion is a platform to track crypto portfolios across every wallet you own and sign transactions from one place. You can also follow other wallets and monitor their investment to stay on top of trends.
Nansen Portfolio: Nansen Portfolio lets users connect their crypto wallets and get an in-depth view of DeFi holdings across 40+ chains and 470+ protocols.
Analytics tools allow you to discover and interpret data from DeFi protocols to make decisions efficiently. Here are some of the most common analytics tools.
APY.vision: APY.vision is a platform to track gains and impermanent losses across liquidity pools so you can find profitable opportunities and know when to enter and exit liquidity pools.
Chainbeat: Chainbeat is a cross-blockchain analytics platform to extract and visualize blockchain data in real time.
DeFiLllama: DeFiLlama gives you in-depth data on liquidity, yields, fees, and total value locked (TVL) across various DeFi protocols.
Dune Analytics: Dune Analytics is a community-driven platform that publishes data on different protocols across Ethereum, BNB Chain, Optimism, and other chains.
Revert Finance: Revert Finance allows Uniswap and Sushiswap users to track their positions and get data on the top positions in a pool. Users can also run a simulation to estimate the rewards they can earn.