Let’s talk about Ethereum. It’s the second-largest cryptocurrency by market cap. But that’s not all; it’s also the most extensive network that hosts thousands of decentralized apps that have totally transformed the way blockchain technology could be used. Decentralized apps differ from the mobile apps people use on their devices because they offer extensive features. The main difference between the two types of apps is that a central authority manages traditional ones, while blockchain-based ones are totally decentralized. The user is in charge of the app – which is fundamental not only for Ethereum but for all the other blockchains.
Without further introduction, let’s talk about the most successful projects that have run on Ethereum because data shows that cryptocurrency continues to be investors’ favorite, and this can be easily noticed in the current ETH price.
Uniswap
If you have been interested in learning more about blockchain technology and projects developed with its help, you must have heard of Uniswap. This decentralized exchange allows users to keep control over their money. Since its launch, it has become the most popular decentralized exchange and one of the Ethereum projects most people use, also supporting the De-Fi movement. Assets’ prices are dictated by supply and demand when they are traded on centralized exchanges. Therefore, when someone wants to acquire or sell an asset, they must find someone willing to meet their requirements.
Uniswap is an AMM based crypto exchange, meaning that it relies on a price algorithm to determine values for traded assets. The investors who provide liquidity get an incentive for their efforts because liquidity is essential in supplying pools and establishing prices.
UNI, the ERC-20 token native to the project, offers network users the right to vote on the platform’s evolution.
Through the v3 upgrade, Uniswap brought several improvements to the exchange, the most notorious one being concentrated liquidity. This new type of liquidity allows providers to establish the conditions for fees eligibility.
Aave
Aave is another exciting project to invest in, also built on the Ethereum network. It was developed as a decentralized lending platform that allows users to raise capital. It has become the second largest DeFi app, according to its market capitalization, and for a short time, it was even the first. It was launched in 2017 through an initial coin offering and took the form of an ETHlend. While there are several lending platforms on the Ethereum blockchain, Aave is unique because it establishes the interest rates according to the utilization rate of the liquidity pool. It also allows people to borrow funds in a currency other than the one they deposited. It’s essential to note that when someone borrows using the Aave protocol, they need to over-collateralize, which means they need to provide more than they borrow.
AAVE is the native token of the system, which allows participants to vote on the important decisions to which the protocol is subjected.
Chainlink
Chainlink is a different type of project from the previously presented ones; it’s an Oracle platform, so it connects smart contracts to real-world information in real time. Smart contracts rely on a set of previously determined instructions to execute actions, and Chainlink allows it to connect it to data like stock prices or even weather conditions. For example, insurance agencies can use it to pay claims when a hurricane hits a particular area. Chainlink was first introduced in 2017, but it gained popularity around 2019 when it partnered with Google.
Oracles are important blockchain projects because they power essential protocols like prediction markets.
LINK is the ERC-20 native token of the networks.
MakerDAO
MakerDAO is another special project because it was the first decentralized lending protocol developed on the Ethereum blockchain, which powered the stablecoin Dai. Stablecoins are a unique kind of digital currency that maintains its value in the long run because it’s connected to another asset. The currency’s value being pegged to another asset brings several advantages for the project because it allows users to take out loans in safe conditions, meaning that they don’t have to worry that price volatility will impact their finances. Dai is also an interesting stablecoin because it’s connected to ETH’s value (while most stablecoins are pegged to traditional currencies like the US dollar).
The Sandbox
The Sandbox has made headlines over the last couple of years, especially since people have started gaining interest in the Metaverse because it allows users to acquire digital land. Land sales in the network have gone wild, and even celebrities have joined the trend and added this project to their investment portfolios. Sandbox is a Metaverse version of Minecraft if you want to compare it with something in terms of functionality and design.
While not all investors might find it beneficial, brands like Adidas and celebrities like Snoop Dog have reasons to invest in the project. Besides owning a piece of digital land, network participants can also create games on their lots and make money from allowing other users to play them. Sandbox landowners can also display their collections of non-fungible tokens.
Decentraland
Decentraland is also part of the Metaverse, but if we compare it to Sandbox, it can be described as less of a game and more of a platform that offers virtual real estate. Decentraland allows users to buy land in the Metaverse, where they can create a virtual world to spend time with their friends, go shopping, visit other digital places, and rent virtual real estate. There are countless possibilities when it comes to what one can do in Decentraland, and many brands buy land and develop worlds in the Metaverse.
The crypto market is experiencing a bull run, which highlights the importance of adding diverse projects to one’s portfolio to increase one’s chances of making a profit. The presented projects are some of the most attractive for investors, regardless of their experience in the industry, because they allow them to invest in cryptocurrencies with varied purposes and reap the benefits. Diversification is pivotal for a portfolio’s success.