Decentralized finance (DeFi) was able to take over the world. Investors, traders, and crypto enthusiasts worldwide now see DeFi as the solution for many issues in the global financial services landscape. The demand for the best DeFi coins and tokens has been increasing dramatically due to the influx of popularity of decentralized finance. Even if they take away the burden of centralized control over financial services, there is much more to learn about DeFi coins. However, are they worth all the hype?

Whether you are a novice trader or a seasoned crypto investor, you should learn more about the best DeFi coins to invest in 2022, and why decentralized finance continues to emerge and skyrocket alongside traditional financial models. In this article, you will find everything you need to know about it.

What Are DeFi Coins?

In the crypto world, DeFi coins are the foundation of the decentralized ecosystem. As so-called digital versions of fiat coins, they are used primarily in decentralized applications (dApps) running on smart contracts for facilitating different transactions. In other words, a DeFi coin is a unique form of currency for decentralized platforms only. They could serve various roles in the native blockchain network alongside the financial ecosystem.

DeFi tokens transfer value, but not always in a financial sense. For example, utility tokens can be used as passwords to grant access to a resource, asset tokens can be used to represent physical assets, for example, real estate, and there are non-fungible tokens (NFTs) that can represent real-world items such as works of art.

Are DeFi coins a good investment?

DeFi coins are gaining momentum for so many good reasons. Different exciting opportunities associated with DeFi coins, primarily for transforming financial services, are key reasons to choose and invest in them. Many industry experts believe that DeFi coins have the ability to bring out the true potential of blockchain for the financial services sector and other applications.

However, DeFi is still not flawless. Unfortunately, some DeFi projects do not always provide the safety that traditional finances can offer, and there’s always a risk of falling victim to a DeFi scam. If you want to start investing in DeFi projects and buying DeFi coins, you should prioritize thorough research and check the smart contracts and codes associated with this or that project. At BullPerks, we care about our community and always ask users to Do Your Own Research (DYOR). Check out our BullPerks DYOR Guide to learn how to analyze IDO projects. Read more about how to invest in DeFi.

Source: Freepik

How to Choose a DeFi Coin?

Choosing the best DeFi coin for your investment portfolio can be tricky and challenging as there are so many coins and DeFi projects on the crypto market. First of all, you should consider the metrics surroundings, including the current market capitalization (check the websites like CoinMarketCap and CoinGecko), growth potential, the project’s past performance, objectives, and road map targets, and crypto exchanges that have listed this particular coin.

Furthermore, when weighing up investment options, some experts also consider checking the most undervalued coins as they can possess a lot of potential for exponential growth in the future. However, there are no guarantees whether a DeFi coin can skyrocket or not.

Top 5 DeFi Coins to Invest in 2022

If you are curious about which DeFi coins to pick in 2022, here’s a short list of some of the best DeFi projects that are definitely worth your attention. However, keep in mind that we do not provide any investment advice.

DeFi Coin ($DEFC)

DeFi Coin can be even called one of the best overall coins to buy in 2022 as it is firmly ingrained within the ever-growing DeFi sector. $DEFC is the native token to DeFi Swap Exchange that went live in early May 2022. It is worth noting that the project burned all of the tokens during the launch to highlight that Defi Coin is not the next pump-and-dump scheme. DeFi Coin has already gained significant attention on social media among its community.

Lucky Block ($LBLOCK)

Lucky Block is a new gaming crypto coin to watch. As another outstanding DeFi project, it promotes transparency and fairness in the industry by leveraging decentralized technologies.

Running on the Binance Smart Chain, Lucky Block’s online crypto prize draw system functions on smart contracts, making it accessible worldwide. The Lucky Block’s native digital token is called $LBLOCK. Users need to hold this token to purchase draw tickets and receive special rewards to access the online giveaway.

Uniswap ($UNI)

Uniswap is one of the first DeFi applications to gain significant traction on Ethereum. It was launched in November 2018. As an exciting DeFi project and liquidity provider, it is one of the top DeFi projects that can come to mind. Uniswap is a protocol that allows swapping ERC20 tokens without an exchange. The current CoinMarketCap ranking is #19, with a live market cap of about $4.5 billion.

Decentraland ($MANA)

Decentraland is the perfect choice if you’re interested in investing in the Metaverse. It is the first blockchain-based decentralized Metaverse launched in February 2020. What’s intriguing about this DeFi project is that users may access it without linking their cryptocurrency wallets or creating accounts. The platform allows purchasing, holding, and trading virtual real-estates using $MANA, its native token.

Avalanche ($AVAX)

Avalanche can be called one of the most valuable and notable decentralized finance (DeFi) coins in 2022. This platform enables users to create and trade financial instruments on the Avalanche network. Founded by an expert in distributed systems and a former Google engineer in 2018, Avalanche is currently the second-largest DeFi platform by market capitalization.

Source: CoinMarketCap

Final Thoughts

Even though this niche is relatively new,  DeFi coins have the potential to become the best big thing and gain momentum. DeFi offers a lot of advantages, including removing intermediaries and brokers. It is also seen as a better finance tool in countries with underdeveloped financial systems with shallow capital markets. Anyone can create DeFi and use decentralized applications (dApps) for seamless operation with money.

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Disclaimer. This material should not be construed as a basis for making investment decisions or as a recommendation to participate in investment transactions. Trading digital assets may involve significant risks and can result in the loss of invested capital. Therefore, you must ensure that you fully understand the risk involved, consider your level of experience, investment objectives, and seek independent financial advice if necessary.