DeFi has steadily grown in prominence over the past year thanks in large part to the strong foundations established by decentralized exchanges (DEX) that enable easy access to the latest tokens and projects.
While there have been previous iterations of DEX user interfaces, such as IDEX or Etherdelta, it wasn’t until Uniswap launched that trading in the DeFi network really took off and facilitated the launch of the finance tokens.
Here are six of the top-performing tokens in the decentralized finance sector.
Uniswap has risen from the humble beginnings of a simple user interface that allowed for a token swap between two ERC-20 tokens, to a rapidly evolving DeFi centerpiece that now sees an average daily trading volume of $1 billion and $3.95 billion worth of liquidity locked on the protocol.
Uniswap liquidity and 24-hour volume. Source: Uniswap
Originally the Uniswap platform operated without a native token and fees that were collected went into a liquidity reserve, but the project performed a surprise airdrop to platform users and liquidity providers following the launch of the rival SushiSwap (SUSHI) platform which offered the same interface as Uniswap at the time but also included the SUSHI governance token.
Following its release and subsequent listing on several top exchanges, UNI quickly spiked above $7.00 before correcting as low as $1.93 on Nov.4.
UNI/USDT 4-hour chart. Source: TradingView
Since that time the price of UNI has continued to climb to a new all-time high of $32.50 on Feb.20.
Excitement over the release of Uniswap v3 and the ability for token holders to stake their UNI and collect a portion of the fees continues to help drive demand and token price higher.
SushiSwap has a controversial origin story, from starting off as a clone of Uniswap to having the lead developer dump their tokens on the market and subsequently donating all funds towards project development, but has since emerged as a top DEX in terms of community involvement and token price.
Governance and staking were early features that SUSHI holders benefited from, as well as increased incentives for early liquidity providers that some called a “vampire attack” on Uniswap.
After listing, SUSHI price rallied from $1.16 on Aug. 29 to $8.84 on Sep.1, but lead developer ‘Chef Nomi’s’ token dump on the open market caused SUSHI to drop as low as $0.475 on Nov.4.
SUSHI/USDT 4-hour chart. Source: TradingView
Since that time SUSHI price has grown by more than 4,080% to a high of $19.77 on Feb.20 and SushiS has become the sixth-ranked DeFi platform in terms of total value locked (TVL) with $3.56 billion currently providing liquidity for the protocol.
PancakeSwap (CAKE) has seen a significant rise in price over the first two months of 2021 as the project emerged as a competitive DEX and the first billion-dollar project on the Binance Smart Chain (BSC).
Skyrocketing fees on the Ethereum (ETH) network have opened the door for the BSC to drain liquidity and users from its top Ethereum-based competitors, and CAKE has stepped up to facilitate that process.
The protocol offers an expanding list of staking pools, yield farming opportunities, a collectibles section and a built-in lottery, hitting many of the “hot topic” trends in cryptocurrencies on top of being a DeFi platform.
Prior to late January 2021, CAKE generally traded below $0.70 with its all-time low of $0.194 on Nov. 3, 2020. Price action for the token began to pick up around the last week of January, around the same time as traders from r/Wallstreetbets were causing havoc in the traditional markets.
CAKE/USD 1-hour chart. Source: CoinGecko
Since its low of $0.194, CAKE has exploded 11,000% to an all-time high of $20.33 on Feb. 19 as the Binance Smart Chain emerged as the top competitor to the Ethereum network thanks to the significant resources of the Binance ecosystem.
Serum (SRM) is a decentralized derivatives exchange that operates on the Solana blockchain network. The DEX is a result of the collaboration between the Solana team and the operators of the FTX crypto derivatives exchange.
Solana was chosen to host the DEX due to its potential to react 710,000 transactions per second (tps) with a current capacity tested to 50,000 tps. With the Ethereum network currently offering 15 tps and high fees due to network congestion, Solana and the Serum DEX could soon see increased usage from traders seeking a lower fee environment.
SRM offers token holders the ability to stake their tokens to earn a yield as well as use them to reduce trading fees on the exchange by up to 50%. The exchange offers cross-chain support allowing for the trustless exchange of assets on different blockchains through a network comprised of more than 100 validators.
SRM/USDT 4-hour chart. Source: TradingView
Following a price breakout after launching during the summer of DeFi in 2020, SRM price reached a low of $0.78 on Nov.04 before finding support and heading higher. It has since increased by more than 944% to a new high of $8.13 on Feb. 25 as options outside of Ethereum begin to gain traction.
Linear Finance (LINA) is a new arrival to the DeFi scene which recently launched on the Binance Smart Chain after originally releasing as an ERC-20 token.
Along with the ability to lock up tokens to mint Linear’s synthetic asset tokens, known as “Liquids,” the protocol allows users to access traditional assets like forex and commodities by utilizing dynamic price feeds and trading them in the decentralized finance setting.
Linear’s cross-chain approach allows users to benefit from reduced fees and the built-in oracle solution helps combat the problem of oracle frontrunning currently experienced in protocols built on Ethereum.
Future plans for LINA also include the rollout of governance capabilities and allowing community members to vote on the future direction of the project. This will include deciding the cost of transaction fees and how much to allocate to the insurance fund.
LINA/USDT 4-hour chart. Source: TradingView
Following its release in September 2020, LINA price dropped to a low of $0.0047 on Nov.19 before skyrocketing 3300% to a high of $0.112 on Feb.12 following its migration to the Binance Smart Chain and several partnerships and exchange listing announcements.
Waves Exchange and a growing suite of DeFi apps
Waves (WAVES) is a multi-purpose blockchain that is capable of supporting a variety of dapps and smart contracts including decentralized exchanges.
One of the integral pieces of the Waves ecosystem is the Waves Exchange, which was initially launched as the Waves DEX in 2017 and offered fast, secure, and low-cost trading and staking for major cryptocurrency assets as well as tokens minted on the Waves protocol.
While the Waves Exchange currently experiences an average 24-hour trading volume of $10 million, recent price gains in WAVES alongside an expanding suite of DeFi apps like Swop.fi could lead to an influx of activity for the Waves ecosystem as fees on the Ethereum network look to remain elevated until the full release of Eth2.