Ultimate DeFi Cheat Sheet

ultimate-defi-cheat-sheet

A quick cheat sheet of the top DeFi (Decentralized Finance) projects where the brightest minds and fiercest innovators are driving the space forward.

Learning about DeFi as a whole is certainly worth anybody’s time and I think that most will be pretty astounded by what you can do RIGHT NOW with the technology being created.

This is the area of crypto to pay attention to and if anyone has any questions I urge you to go ahead and ask as I enjoy spreading knowledge about the space.

Even if one is not interested in investing in these assets that are “further out on the risk curve” as Raoul puts it they will still greatly benefit from expanding their knowledge. Knowledge is power.

Ethereum (ETH) The network protocol that DeFi runs on. It is the infrastructure that allows developers to build on smart contracts.

Chainlink (LINK) Industry-standard Oracle service that powers DeFi. Value Network uses Chainlink as a price aggregator. An oracle’s job is to provide data. Chainlink ensures that this data is secure by operating in a trustless network. Secure data is crucial to these protocols as they currently secure over twenty-five billion in assets. Insecure data being fed to the smart contracts that power these protocols can lead to the losses of millions in assets, especially so when the network is stressed due to high usage and or high volatility. (see: MakerDao, a project that chooses to use insecure oracles leading to multiple catastrophic failures of its protocol during the March crash)

AAVE (AAVE) Decentralized “bank” or lending pool where you can deposit your crypto as collateral and take out loans, or simply earn interest on your deposits.

Yearn Finance (YFI) A protocol where one can deposit tokens or stablecoins to earn a yield on them.
This protocol takes your token and automatically calculates the best strategy to earn a yield on it, usually by depositing it in different decentralized lending pools.

Synthetix (SNX) Derivatives liquidity pool offering users synthetic exposure to a wide range of assets
For example, say one has BTC but they also want some exposure to silver. They can deposit their BTC onto Synthetix and get that exposure they desire through derivatives. This would be as opposed to having to sell BTC into USD then wiring it to a bank account or broker to get that exposure.

Compound Finance (COMP) Decentralized “bank” or lending pool similar to AAVE

Balancer (BAL) Liquidity pools to swap between different tokens

Curve Finance (CRV) Liquidity pools are used to conveniently swap large amounts between different stable coins i.e, USDC, USDT, DAI

Thorchain (RUNE) interoperability chain. The goal is to connect different chains to allow users to swap between say ETH and BTC smoothly.

Uniswap (UNI) Decentralized exchange protocol. Trade between different tokens on the ETH network. Users providing liquidity to the protocol collect fees from those trading on it.

Sushiswap (SUSHI) Decentralized exchange similar to Uniswap. Uniswap was the first in the space. Sushiswap aimed to attract users through monetary incentives.

1inch (1INCH) Decentralized exchange aggregator. Swapping tokens on here gives the best available price between all decentralized exchanges and liquidity pools.

 

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