Introduction
As the world of crypto has progressed through the times – it has greatly evolved, like every new technology. It has evolved from Bitcoin – which was simply a means of value transfer in a peer-to-peer way to Ethereum and the likes with smart contract and programmable money. That’s when the idea of dApps, which is short for decentralized applications – was born. Decentralized applications was simply a way through which various app based-services could be offered over the blockchain in a truly decentralized manner.
Thus, due to these features – dApps are applications that you can use that use the blockchain network for its security and additional features. Thus the data pertaining to your identification or funds is truly secure and away from prying eyes. This enables that your data belongs only to you, and that data in no way can be accessed by any company or individual through that app.
Dapps can take various shapes and forms as it can range all the way from providing decentralized financial solutions to social media networks and even play-to-earn games to auctions and things like that. Nearly everything can be done in a truly decentralized manner by utilizing smart contracts.
So with that out of the way, let’s take a look at some of the top dApp projects that you should know about in 2023.
DAPP PROJECTS |
MARKET CAP |
PRICE |
TVL |
|
Uniswap (UNI) |
$4.9 billion |
$6.5 |
$3.8 billion |
|
Compound (COMP) |
$380 million | $52.5 | $1.94 billion |
|
yearn.finance (YFI) |
$263 million |
$7180 |
$432 million |
|
MakerDAO (MKR) |
$624 million |
$638 |
$7.1 billion |
|
CurveDAO (CRV) |
$708 million |
$1 |
$4.75 billion |
Read More: Top Metaverse Crypto Projects
1. UNISWAP (UNI)
Uniswap is one of the most popular and well known decentralized exchange application in the crypto space. It is also, by far, the largest decentralized exchange by its token market capitalization and the second largest in terms of total-value-locked in DeFi (TVL), second only to Curve DAO.
Uniswap is a decentralized application that offers a truly decentralized exchange platform for peer-to-peer trading of digital assets using smart contracts to function as the automated market maker (AMM) in the system. This platform is fully permissionless – meaning there in no involvement of any intermediaries while carrying out the trades on the exchange and is fully run by the smart contracts. The platform operates on the Ethereum blockchain, which has recently transitioned from Proof-of-work to a Proof-of-Stake consensus mechanism.
Uniswap is governed with the help of its native ERC-20 compatible token, UNI. UNI is also used to reward users on the platform and the UNI holders are also entitled to take part in the governance protocol. Uniswap’s native token UNI is amongst the top DeFi tokens by market capitalization.
2. COMPOUND (COMP)
Compound is yet another decentralized application (dApp) that runs on the Ethereum network that has the objective to incentivize a distributed network of computers to operate a traditional money market. It is a decentralized solution that allows users to lend and borrow crypto over the blockchain network and it is run with the help of its governance and native token, COMP.
Thus effectively, Compound’s protocol allows users with extra cryptos that are HODLing to deposit those into lending pools to be accessed by borrowers. Like any borrowing and lending business – lenders earn an interest from the borrowers depending on the amount and the predetermined interest rates. However, through Compound, this service is provided in a decentralized manner – where once a deposit is made, Compound awards a new crypto called a cToken (like cETH or cBAT, depending on the token deposited by the lender). This brings about liquidity as these cTokens can be transferred or traded seamlessly but can be redeemed only for the crypto initially locked within the protocol. This entire process is completely automatic and handled by the smart contract built into Compound and the features can be accessed at any time whatsoever.
To incentivise this activity on their platform, the Compound protocol uses its native crypto token, COMP. So, every time a user interacts with the Compound’s platform and market, either by borrowing, withdrawing or repaying the asset, they are rewarded with additional COMP tokens.
3. YEARN.FINANCE (YFI)
One of the most unique decentralized app (dApps) projects that you should know about in 2023 – yearn.finance is a group of protocols running on the Ethereum blockchain network that allows users to optimize their earnings on crypto assets through lending and trading services. Staying true to the idea of decentralized finance (DeFi), yearn.finance provides various services on its platform that run purely on code – thus removing the need for any financial intermediary like a bank or custodian in the middle. To achieve this, it has built up a system of various automated incentives that is doled out through the use of its native crypto token, YFI.
The yearn.finance decentralized application (dApp) consists of a bunch of products across various financial sections including the likes of APY or annual percentage yield table, that depicts interest rates across different lending protocols and Earn, which identifies the highest interest rates for users to take advantage of by lending their crypto holdings. Along with those, there’s the Vault feature which works as a collection of investment strategies designed to generate the highest returns from other DeFi projects and Zap, which provides the feature of bundling trades across various crypto assets in one click – thus saving a lot of time and improving efficiency for the user.
In essence, yearn.finance capitalizes on the popular practice of ‘yield faming’ amongst veterans of the crypto markets – where users lock up their crypto asset holdings into a DeFi protocol in order to make some passive income from their idle crypto holdings. So the more cryptos a user can lock up on the DeFi smart contracts, the more rewards they get.
Additional read: Top Liquid Staking Tokens in 2023
4. MAKERDAO (MKR)
MakerDAO is a peer-to-peer crypto lending and borrowing platform that is run by a decentralized autonomous organization built on the Ethereum blockchain network. Similar to most other DeFi protocol, this dApp’s lending and borrowing mechanism is also run by smart contracts.
This dApp also takes things further by creating and making using of a stablecoin known as Dai to determine lending rates and repayable amounts for the loans taken by users on this decentralized application. This is a practice that was built to mitigate the risk of volatility in the crypto assets taken as collateral.
The main objective of the MakerDAO decentralized application is to create a crypto lending and credit platform that disburses loans at predetermined interest rates to those in need. If a user wants to borrow any particular crypto for some purpose, they can deposit a determined value of ETH into the Maker smart contract. Now the MakerDAO smart contract creates a Collateralized Debt Position (CDP) and disburses the loan.
5. CURVE DAO (CRV)
Curve DAO is an automated market maker (AMM) platform that essentially provides a means through which token exchanges can work while maintaining low fees and slippages by accommodating liquidity pools made up of similarly performing assets. As the name suggests, it is managed by a DAO, and its native token, CRV becomes a means through which the platform is governed and also incentivizes participation by integrating with external DeFi protocols and delivering rewards.
Curve DAO was founded and launched back in 2020 by a Russian scientist, Michael Egorov. Egorov has experience with blockchain and crypto companies, since he had co-founded NuCypher and served as its CTO. NuCypher was a company that is focused on building privacy-oriented protocols and infrastructure.
Additional Read: Top DAO Projects 2023
