Decentralized finance (DeFi) is a structural financial system that seeks to directly connect loan recipients and lenders, as well as buyers and sellers of stocks by removing banks, brokers and other intermediaries.
But it also raises the question that since now there are no more banks involved, how can we build trust between the two parties?
Well, that’s where Blockchain comes in. Blockchain technology, which is basically a network of distributed ledgers, is the foundation of decentralized finance because it prevents data from being altered by hacking or manipulation. one system.
So here is a list of the top 5 decentralized finance projects by market capitalization
Dai (DAI): Dai is a decentralized Ethereum (ETH) based stablecoin that aims to keep its value constant at $1. The goal of this DeFi initiative is to bring stability to the extremely volatile crypto market. MakerDAO’s first official white paper was published in December 2017, which introduced Sai, and only accepted Ethereum as collateral.
The Dai Stablecoin system, commonly referred to as the Maker Protocol, accepts Ethereum-based assets as collateral from MKR holders. Accordingly, you can generate Dai using any Ethereum-based token as collateral in the form of smart contracts, or you can buy Dai tokens directly from any crypto exchange. The market capitalization of Dai was $6.8 billion as of 2:20 p.m. on September 10, 2022, and the current price of one Dai is $0.99.
Avalanche (AVAX): Avalanche is a decentralized proof-of-stake blockchain based on smart contracts. Smart contracts are the rules on which a Blockchain is built, and those rules can only be changed by community consensus, not by a single person.
Avax is the native token of the Blockchain Avalanche developed by Ava Labs. Emin Gun Sirer, the creator of Ava Labs, is also a professor of computer science at Cornell University.
The best use case for Avalanche Blockchain is that many decentralized applications (Dapps) run on it. These Dapps work according to pre-written rules, and therefore no individual can modify them. The market capitalization of Avalanche (AVAX) was $6.1 billion as of 2:20 p.m. on September 10, 2022, and the current price of one AVAX is $20.45.
Wrapped Bitcoin (WBTC): Wrapped Bitcoin is an Ethereum token designed to act as a digital representation of Bitcoin (BTC) on the Ethereum Blockchain. It is not Bitcoin, but rather an ERC-20 token intended to track the value of Bitcoin. The WBTC was intended to allow Bitcoin holders to engage in Ethereum’s popular decentralized finance (“DeFi”) applications.
Its purpose is to serve as a link between the Bitcoin and Ethereum Blockchains. This allows Bitcoin owners to seamlessly interact with the Ethereum Blockchain. The market capitalization of WBTC was $5.3 billion as of 2:20 p.m. on September 10, 2022, and the current price of one WBTC is $21,344.
Uniswap (UNI): Uniswap, the largest decentralized cryptocurrency exchange, was founded in November 2018. Instead of matching supply and having a centralized exchange set the price, algorithms set the market price based on the demand and supply. This allows users to trade cryptocurrency without the assistance of an intermediary, making it fully decentralized.
The buyer and seller trade directly from their wallet, so no third parties are involved. No documents are required to trade on the exchange, which makes it permissionless and borderless. Uniswap’s market capitalization was $4.9 billion as of 2:20 p.m. on September 10, 2022, and the current price of one UNI is $6.53.
Chain link (LINK): Chainlink is a decentralized Blockchain network built on the Ethereum Blockchain. He intends to connect Blockchain data with real-world data that exists outside of Blockchain. Its native token is known as LINK, which is used as currency on the Blockchain and also to reward bettors.
Its aim is to provide off-chain data on the Blockchain in the form of smart contracts, which makes it decentralized and safe. It was launched by Sergey Nazarov and Steve Ellis in 2017. Chainlink’s market capitalization was $3.8 billion as of 2:20 p.m. on September 10, 2022, and the current price of one LINK is $3.8.