The document discusses the rise of successful DeFi (decentralized finance) startups and their unique features, highlighting leading projects such as MakerDAO, Compound, Aave, and Uniswap. It emphasizes the irreversible decentralization of financial markets driven by blockchain technology and outlines the expected growth of the blockchain market from USD 3.0 billion in 2020 to USD 39.7 billion by 2025. Key characteristics of various DeFi protocols are detailed, showcasing their functionalities in lending, borrowing, and trading, with a particular focus on the convenience they bring compared to traditional financial systems.

1. 2021 Successful DeFi Based
Startups and its Unique Features
Blockchain-based DeFi projects have been leading the way in recent months. With
the creation of stablecoin, the decentralization of the financial market has become
irreversible. Since We are providing all types of ​DeFi token Development in a safe
and secure manner. As there is no potential to limit, according to
MarketsendMarket’s research:
“Blockchain market size is expected to grow from USD 3.0 billion in 2020 to
USD 39.7 billion of 2025, at a Compound Annual Growth Rate (CAGR) of 67.3%
during 2020–2025”
Such a promoting market gathers more and more attention from the investors, so we
want to underline the most successful of them.
THE BEST DEFI STARTUPS TO FOCUS:
● MakerDao
● Compound
● AAVE
● Uniswap
● Curve
● Balancer
● dY/dX
● Kyber
● Synthetix
● Dharma
MAKERDAO

2. Launched in 2014, ​MakerDao is a DeFi sector. It is an open-source platform based
on the ​Ethereum blockchain​. Decentralized autonomous organization at the same
time. A specially developed mathematical system manages all aspects where the
management rights are distributed throughout the maker's MKR token holders.
DAO (Data Accessing Objects) governance layer ensures the efficiency and
transparency of the system. The number of votes is proportional to the number of
MKR tokens (Maker governance token) that the user sent to the voting contract
address, chief. ​In other words, the more MKR tokens a user contributes, the
more he influences the final decision.
Maker Protocol also allows the creation of digital currency and has its own stablecoin
Dai, which is pegged to ETH as the only accepted crypto-collateral and is equal to 1
US dollar.
The system is regulated by unique smart contracts called CDP (Collateralized Debt
Positions) where any user is allowed to generate Dai. Broadly, Maker protocol

3. includes the following elements: Dai stablecoins, collateralized Maker vaults, oracles,
and voting.
As the early DeFi protocol Maker has a very strong position on the market while DAI
is one of the most wanted cryptocurrencies. Maker is ranked as the second among
all existing DeFi platforms according to DeFi Pulse.
COMPOUND
Compound is another Ethereum based open-source protocol that creates the
money markets for crypto holders. In other words, Compound is a lending platform.
Protocol algorithms automatically secure the interest rate based on the supply and
demand and thus allows users to benefit from floating asset rates. This way such a
system helps suppliers or borrowers to avoid unnecessary negotiations about
payment terms, interest rates, or collateral.

4. The ability to act without additional intervention of counterparties (and pay their
services) is one of the biggest advantages of DeFi in general. Each money market
on Compound contains the full transaction record and is accessible for verification.
Generally speaking, Compound’s job is very similar to the traditional banking system,
where you can deposit your fiat currency. As follows you earn a monthly or yearly
rate while letting the others borrow your money through the bank as an intermediary
party. With such protocols as Compound, you can do the same action 24/7 and
benefit from additional features of cryptocurrencies.
In comparison to the traditional financial system, where the return rate is around 0%,
with the Compound mechanism users could earn 5-10% annually on average, which
makes it definitely one of the top DeFi projects on the market.
AAVE
AAVE is a decentralized, non-custodial lending protocol that enables its users to
lend and borrow digital assets and gain on the rate fluctuations.
AAVE also provides lending pools similar to Compound markets. Yet, the distinctive
feature of AAVE was the introduction of flash loans (as the first protocol on the
market). Flash loans make the user experience more convenient and let you earn
even more.

5. The flash loans give the possibility of taking an immediate loan from one of the pools
without any collateral. In order to guarantee the safeness of such transactions, the
loan has to be returned in one block. Otherwise, all actions made with it will be
banned and invalid.
Another greatness of AAVE is the ability to provide users with decentralized and
secure crypto price data thanks to its integration with Chain Link oracle. This
collaboration enables users to get accurate and on-time data from various on-chain
and off-chain services. Thus, helps to ensure the reliability of the AAVE platform.
Thanks to its convenience and variability of useful features, AAVE has become
favorable instantly and surely is one of the best DeFi startups of this year. Since its
recent launch in January 2020, the amount of assets held on this protocol has been
growing by about 12 mils US dollars monthly.
UNISWAP

6. Uniswap is a big daddy of today’s DeFi. It stands for decentralized Ethereum based
protocol which allows users to secure and safely exchange ERC-20 tokens based on
the AMM mechanism.
The distinctive feature of Uniswap is the lack of a traditional order book mechanism
that has to determine the asset value. The whole workflow is maintained by smart
contracts and AMM algorithms.
AMM is an automated market maker that counts the exchange rate automatically
using the “constant product market model”. This allows to eliminate traditional order
books and considerably faster the exchange process.
HAVEN’T REALLY UNDERSTOOD WHAT THE AMM IS? DON’T
WORRY, FIND THIS COMPREHENSIVE GUIDE ON HOW THE AMM
TECHNOLOGY WORKS?
It basically works as an exchange for cryptos, yet in order to take any action, you
have to provide your own liquidity to the protocol first. Uniswap gathers tokens into

7. pools where users can carry out a needed transaction. Additionally, in Uniswap
users are able to earn from providing liquidity to the pools.
Uniswap works commonly to stock markets and uses contracts that combine Ether
and certain tokens into a pool. While exchanging Ether for a token, the Ether goes to
a contracting pool, and the token returns to a user. Such a mechanism allows
providing security and faster exchanges due to lack of counterparty involvement and
the necessity to wait for matching with anyone for price specifications.
CURVE.FI
The curve is a decentralized Ethereum based exchange. The mechanism here is
similar to Uniswap, yet the idea is to change stablecoins only instead of Ether and
tokens.
FIND OUT MORE ABOUT WHAT is STABLECOIN IN THIS ARTICLE
The same as Uniswap, Curve uses an AMM algorithm that does not require a sell
order to be matched by other orders which makes the curve fully automated. Yet,

8. unlike Uniswap, Curve uses a slightly different type of “curve”. This helps to make
autonomous exchanges 1:1 close rate with the approximate exclusion of slippage
and minimal fees.
Furthermore, the creators of Curve provided its users with the ability to earn on the
liquidity put in the pools. The cooperation with other DeFis enabled getting the most
profitable interest rate among certain chosen tokens. It is possible due to rebalancing
the basic token while at the same time, keeping the main stablecoin for its owner.
The curve was the first protocol to provide a decentralized exchange for stablecoins
which helped it to gather a lot of liquidity within a couple of months. Additionally, its
unique pool balancing mechanism considerably decreases the slippage between the
exchange rate which makes it resistant to such a big inconvenience as an
impermanent loss.
BALANCER
Balancer protocol was launched in March 2020 and is a representative of a young
DeFis. The balancer is a crypto exchange protocol that works according to
previously discussed automated market maker algorithms. Yet, it uses an alternative
type of AMM named “​constant mean market maker​”.

9. The balancer is called among the best DeFi startups due to the number of distinctive
advantages. In contracts to Uniswap, it allows trading against existing tokens, not
only ETH. The other thing is the ability to provide an unequal amount of tokens to the
pool (like 60/40 or even 95/5) while keeping the mechanism balanced.
There is the ability to create three types of pools within Balancer protocol. ​The first
type is a private pool that belongs to one specified user. The owner is the only one
who can provide liquidity to the pool, and further manage the pool parameters.
The second type is a shared pool where every user can join and become a liquidity
provider. The pool parameters such as fees, tokens, weights are set in advance so
the pool creators cannot really influence them. To track the pool ownership balancer
protocol introduced BPT token.
The next type stands for smart pool and is similar to the private one, but is managed
by the smart contract. It allows users to adjust the pool features and accept liquidity
from any protocol user.

10. Balancer’s main contribution is the introduction of flexible token swaps due to a
unique market maker mechanism. Moreover, users do not use the trading option
only. They are able to earn profit and take part in protocol governing.
DY/DX
dYdX is a margin trading platform, which provides the ability to spot trading, lending
and borrowing of crypto assets. Tho, this is not just another decentralized exchange.
The problem before dYdX creation was that the margin trading was limited only to
CEXs like ​Binance or ​Kraken​. Therefore, the dYdX launch brought trading tools to
another level.
dYdX does not use an AMM algorithm to enable trading options like previously
discussed Balancer, Uniswap, and Curve. It is based on the traditional
supply-demand model, yet the trading process is carried out by the smart contract.
This allows for faster and non-custodial transactions between users.
dYdX stands on the best DeFi startups list because it currently shows one of the
highest volume and liquidity flows within DEXs. Additionally, it offers very attractive

11. lending options, like an automatic and immediate interest-earning out of each
produced block on Ethereum.
SYNTHETIX
Synthetix opens derivatives for crypto. Synthetix is a decentralized protocol for
synthetic token emission built on the Ethereum blockchain. Currently, there are more
than 30 synthetic assets representing commodities like gold (etc.), fiats, and
cryptocurrencies.
Those synthetic assets (Synths) can be created while providing ETH and Synthetix’s
token SNX as collateral. Users can freely exchange Synths for other tokens as long
as they are pure ERC-20 tokens.
All Synths have to be backed by an SNX token with a Collateralization ratio equal to
750%. Holders are able to manage the ratio by burning or releasing Synths to
achieve this. If users meet the required collateralization ratio they receive a weekly
reward.

12. Synthetix also has its own DEX called ​Synthetix.exchange where users can trade
synthetic cryptocurrencies, commodities, indexes, and Forex.
The fees collected from Synths trading on the Synthetix exchange are distributed
between SNX and synths holders. This works as an incentivization mechanism to
emit (create) more Synths within the network.
Synthetix allows real-world assets to be traded on crypto markets. While started as a
stablecoin, with the development of DeFi it became one of the biggest platforms for
derivatives in crypto.
KYBER
Kyber is a decentralized exchange for cryptos. Unlike other exchanges where your
exchange possibilities are limited to certain trading pairs against ETH, with Kyber
you are able to buy and sell any ERC-20 token directly.
It also has its own token KNC (Kyber Network Crystal) in order to manage
governance processes and incentivize protocol users.

13. Kyber exchange uses neither order books nor AMM models to establish the token
price. There are currently more than 70 liquidity pools (called reserves) where
customers provide their assets in order to make a change.
Reserves are initially smart contracts that hold the money. In order to make a
change, the protocol “checks” all the existing reserves to propose the best price of a
certain token.
A distinctive advantage of Kyber is that the user is able to establish the price he
wants to trade his asset. The network introduces a limit order, so you do not have to
trade at the “current” exchange rate if you do not want to. You are able to wait until
the desired price appears.
Kyber introduces a fast and considerably low-fees exchange for cryptos. While
introducing the limit orders for trades Kyber helps to achieve the desired amount in
return instead of admitting the current market price. Additionally, with the help of this
feature, the user will not lose custody of his crypto asset.
DHARMA
Dharma creates a marketplace for lending and borrowing cryptos. As the first, it
introduced Automated Clearing House (ACH) purchases in chosen US states.
Dharma is integrated with Uniswap V2 and allows lending and borrowing of all
assets available there. Yet, Dharma does not only open the crypto to new users. It
can be very beneficial for the old DeFi traders as long as it provides a variety of
advantages like​ gas fees coverage for all users.

14. Moreover, thanks to ACH support, the Dharma app allows DeFi trading directly from
your bank account. At the moment of purchase, the bank will charge a 1.5%
commission for each transaction. The maximum size of purchases is established for
$25000 per week.
“Making an investment in DeFi has, up until now, been a bifurcated and highly
technical process. Now, it’s as easy as downloading an app and connecting your
bank account”.
To summarizing, Dharma is a portal to a fast and easy DeFi for everyone. By
installing an app, every one can simply access crypto investment opportunities,
which definitely makes this startup one of the best DeFi crypto projects ever.
CONCLUSION
We are extremely glad that blockchain technology has entered the financial market
and brought such great initiatives as Dharma to life. It is worth noting that Uniswap
has considerable superiority over other protocols. Its pioneer position on the DeFi
market might be considered as one of the preconditions to such.

15. Yet, Uniswap’s competitors have found a big place for growth and development in its
partial inconveniences and loops. The detection and willingness to eliminate those
have contributed to the invention of a list of other protocols.
Along with market augmentation, the number of projects concentrating on DeFi will
also grow. We hope this list of the top DeFi startups will give you a basic
understanding of the sector or would trigger the creation of your own DeFi!
Brugu Software Solution is a prominent player in offering DeFi based startups. Get in
touch with them, If you have a plan to enter the DeFi zone.