DApps are decentralized applications based on blockchain technology that allow you to interact with complex smart contracts and perform a number of actions. You can trade crypto, borrow funds, lend assets, trade NFTs, and earn yield with the help of the best crypto and DeFi dApps in 2022.
In this article, I’m showing you a brief overview of the top 10 dApps in crypto. Each section talks about a unique and popular dApp that you might have heard about already. I explain what the dApp is used for, how it works, and how much utility it has within the greater DeFi ecosystem.
Top 10 Best Crypto & DeFi dApps to Try Out in 2022
The section below talks about the best DeFi dApps in 2022. Keep in mind that I have not ranked them in any particular order. If you want to learn more about a specific dApp, I recommend searching for its name on Shrimpy Academy and reading one of our fabolous articles.
Which other dApp to mention first other than the one and only Uniswap? Created by Hayden Adams, Uniswap is a decentralized exchange (DEX) that kickstarted crypto’s DeFi journey. It is the very first automated market maker (AMM) exchange that brought us liquidity pools, liquidity mining, yield farming, and other great features.
Uniswap is currently ranked 4th on DeFi Pulse’s DeFi leaderboard. It has a total collateralized value (TVL) of $3.79 billion. It is the most dominant DEX in DeFi right after Curve. Over the past years, Hayden and his team have launched new iterations of Uniswap; bringing lower fees and improved liquidity efficiency.
Uniswap is a completely decentralized protocol governed by its community with the help of the UNI token. UNI holders can propose and vote on all kinds of governance proposals – one being relaying trading fees to UNI holders.
You can either swap tokens or provide liquidity on Uniswap. Swapping tokens involves exchanging one cryptocurrency for another, while providing liquidity involves temporarily locking assets in order to earn passive rewards.
Compound is a world-renowned lending protocol on Ethereum which you can use to borrow or lend crypto assets. The protocol’s decentralized nature allows its users to exchange funds directly via smart contracts – therefore evading the need for intermediaries.
Lenders earn interest on the assets they provide to Compound, starting from an APY rate as low as 3% or as high as 20%. Borrowers have to pay interest until they repay their loan. If the asset borrowed falls dramatically in value, borrowers face the risk of liquidations. They have to provide more collateral in the case that they’re close to liquidation.
All you have to do to get started with Compound is to create a MetaMask wallet and connect to the protocol. If you lend assets, you will receive a cX token (cETH, cUSDT, cLINk, etc.) that tracks how much you’ve lent and the amount of interest you’re earning.
Compound requires no KYC, meaning that anyone can take out a loan. The interest earned fluctuates for each asset individually and depends on the supply/demand ratio. Overcollateralized assets typically provide lower returns. And like other DeFi dApps, Compound also has its own governance system.
PancakeSwap is a DEX native to the Binance Smart Chain (BSC) smart contract ecosystem. The DEX has a TVL of $2.97 billion according to data from DeFi Llama and is ranked eight on the website’s DeFi leaderboard.
PancakeSwap is the most popular dApp inside Binance’s DeFi world as it provides numerous utilities aside from simple token swaps. For example, you can trade decentralized futures with up to 100x leverage or participate in lotteries. Lotteries take place every day and thousands of dollars in reward.
Just like on Uniswap, you can also provide liquidity and yield farm on PancakeSwap. However, you can only provide liquidity for tokens native to the BSC blockchain. You can also buy non-fungible tokens from PancakeSwap’s NFT marketplace.
What’s so good about this dApp is the fact that it is far cheaper to use during bull markets. Ethereum dApps can get quite expensive during bull runs where gas fees reach exorbitant numbers. But because of BSC’s efficiency and transaction speed, you won’t suffer high fees.
OpenSea is the largest NFT marketplace in all of crypto. The exchange is native to Ethereum and allows you to trade, buy, and sell all kinds of NFTs. Collections have to be verified by the team before landing on OpenSea, which adds a great sense of security.
All it takes to use OpenSea is a non-custodial Web3 wallet and some ETH. You can freely buy any NFT at their floor price or participate in auctions and bid with other investors. You can also list existing NFTs inside your wallet and earn some ETH.
You can buy or sell the following Ethereum NFTs on OpenSea:
ENS domain names
Virtual worlds (game collectibles)
The good news for Solana investors is that the OpenSea team recently introduced a feature that allows you to purchase Solana-based NFTs. These NFTs are denominated in SOL and require a wallet compatible with the Solana blockchain.
Although OpenSea has received severe criticism from the NFT community during its existence, it still remains the largest NFT marketplace. I recommend you to stay safe when using OpenSea and avoid some of its mysterious bugs.
5. Magic Eden
Magic Eden is the dApp you want if you’re searching for an NFT marketplace native to Solana. Magic Eden hosts some of the most popular NFT collections on Solana such as DeGods, Degenerate Ape Academy, Galactic Geckos, Famous Fox Federation, and many others. The exchange has a monthly trading volume of $128 million.
Magic Eden charges zero fees for listing and only 2% in transaction fees. Collection creators are free to charge royalties to buyers and sellers, although most royalties range from 2% to 10%.
Magic Eden launched on September 17 2021 as a fierce competitor to SolanaArt. In June 2012, the NFT marketplace raised $130 million in a Series B round led by Electric Capital and Greylock Partners. Magic Eden’s total valuation was estimated at $1.6 billion.
Magic Eden’s unique feature is its launchpad. On the launchpad, creators can launch their collections and allow whitelisted community members to purchase NFTs prior to their launch. The launchpad facilitates minting new NFT collections and makes it easy for users to invest.
Aave is the second-largest lending protocol on Ethereum. The decentralized protocol facilitates non-custodial lending and allows you to earn interest on your existing crypto assets or borrow new assets. Aave is completely decentralized thanks to its native AAVE governance token.
Aave removes the need for banks by allowing you to directly borrow or lend cryptocurrencies to other investors via smart contracts. The interest you earn or pay depends on the supply/demand ratio of each asset. The protocol can liquidate your collateral if the borrowed asset loses too much value on the market.
The origins of this protocol trace back to 2017 when Stani Kulechov founded EtherLoan. The project later rebranded and migrated to a new token following the introduction of a governance structure. The community at the time switched from LEND to AAVE.
Flash loans are a novelty that Aave introduced with the new protocol’s launch. Flash loans let you take out any amount of funds from the protocol without having to provide any collateral. However, the catch is that you must repay the loan within the same transaction block it was issued. Flash loans primarily have a use case in arbitrage trading.
7. Yearn Finance
Yearn Finance is a yield farming aggregator on which you can not only earn passive income by providing liquidity, but also earn even more money by placing the yields and LP tokens you receive into new liquidity pools. Yearn Finance is a highly popular yield protocol popular due to its vaults. It has a TVL of $77.1 million.
The protocol has built-in yield farming strategies that automatically place your funds in liquidity pools with the highest returns possible. The process allows you to maximize your returns without having to contribute time nor effort.
Curve is another cool Ethereum-based DEX that offers almost risk-free yield farming by focusing on stablecoins. You can earn low, yet stable interest by providing stablecoin collateral in single-asset liquidity pools.
Some of the more popular stablecoin pools include DAI, USDC, and USDT. But no worries, you can also invest in riskier pools that hold more volatile assets. Such pools are tricrypto2 (USDT+wBTC+wETH), 3pool (DAI+USDC+USDT), and frax (FRAX+3Crv).
Curve's key feature is slippage. Because it is the largest DEX in DeFi, it has enough liquidity to prevent any notable slippage from taking place when you swap tokens. This means that you can trade cryptocurrencies in a decentralized fashion without spending too much on fees and slippage.
MakerDAO is the number one DeFi protocol in all of crypto and DeFi. It is a lending protocol that utilizes the DAI stablecoin and MKR governance token to facilitate trustless crypto lending and borrowing. The protocol has exclusively focused on ETH for a long time, but as of recently, it allows you to borrow and lend other cryptocurrencies as well.
Decentralized lending on MakerDAO works on the premise of liquidations. If you’re unable to pay your loan back or if the borrowed asset lost too much value, the protocol will take your collateral. However, in times of severe market volatility, the protocol will sell its MKR tokens and provide them as collateral in order to save the protocol from massive liquidation cascades.
DAI is a completely decentralized stablecoin native to the MakerDAO ecosystem that you can use when borrowing or lending. You can also use it when accessing other dApps. For example, you might want to swap some of your DAI for LINK, ETH, or COMP on Uniswap.
MakerDAO protects the DAI dollar peg with the help of numerous smart contracts. The protocol automatically burns or mints new MKR tokens in order to stabilize DAI’s peg to the US dollar.
As of October 2022, MakerDAO has a TVL of $7.75 billion – making it the largest DeFi dApp.
Here’s something completely different for a change: DYdX. This protocol is a DEX that facilitates decentralized perpetual futures trading for over 35 cryptocurrencies. Yes, that means that you can essentially trade with leverage without having to complete KYC on a centralized exchange.
You can use DydX for free and trade perpetual contracts with no fees with up to 20x leverage. DYdX has a lot of liquidity, which means that you’ll almost never experience issues having your order filled. Some of the assets you can trade include:
What’s so great about this protocol is that it incorporates Layer 2 (L2) scaling tools to bring fast withdrawals, low fees, and quick transactions.
As of October 2022, DYdX has a daily trading volume of $500 million. The project is backed by notable crypto investing funds and VCs such as Andreessen Horowitz, a16z crypto, Paradigm, Polychain, Dragonfly Capital, and many others.
About The Author:
Marko is a crypto enthusiast who has been involved in the blockchain industry since 2018. When not charting, tweeting on CT, or researching Solana NFTs, he likes to read about psychology, InfoSec, and geopolitics.
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