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Top 5 Lending Platform in Decentralized Finance (DeFi)

BitForex Editor
Sep 14, 2020

DeFi is simply means decentralized finance.

The term DeFi includes protocols, decentralized applications, financial smart contracts, and digital assets. The blockchain is the foundation for all things that pertain to DeFi.

When you consider the fact that DeFi has become the major storehouse for Ethereum, it becomes doubly necessary to consider how the resources within DeFi can be repurposed to benefit the thousands of daily users.

DeFi Loans (How They Work)

Decentralized lending platforms give users and businesses access to loans without the need for middlemen. They also enable anyone who utilizes their protocols to earn interest in cryptocurrencies and stable coins.

The process of lending in decentralized finance is straightforward. It is as simple as taking money from your wallet and placing it in the hands of the individual that wants to borrow.

The middlemen that would have functioned as negotiators in this process have all been replaced by Smart contracts and Decentralized applications. For example, if you wanted to lend a person, say $20,000 through a decentralized lending application, all you need to do is authorize it from your laptop and that's it. The process that you might not be aware of is, you have essentially opened a DApp that hosts both a smart contract and a pool of users who want to borrow. When you authorize the lending transaction and specify the interest rate of the respective loan, if the borrower agrees to the terms, the process immediately begins.

On the other end of these lending transactions, borrowers can take huge loans in a matter of minutes without having to disclose or reveal their identity to any third party.

Below is a list of the top 5 lending platforms in decentralized finance:

Top 5 Lending DeFi Apps


Maker is a DAO where individuals can put cryptocurrency and get Stablecoin DAI in return. This DAI tracks and replicates the value of the US Dollar and its minimum collateralization rate is 151% of every $1.51 that individual deposits.

MakerDAO is the first DeFi (Decentralized Finance) platform to amass a billion dollars worth of assets. Maker might be overwhelmingly complex at the backend but the interface that serves the users is as easy as a meal.

As an investor, you can deposit DAI at no extra charge and as a borrower, you can also get funds at no extra charge. However, this is subject to change, so if you need more information, you should check their website for more information.


InstaDApp is a trustless smart wallet created solely for DeFi (decentralized finance). It gives DeFi users complete access to manage, optimize, and deploy their assets in order to obtain the biggest ROI they can manage. It also has a smart and effective user interface that makes it easy for users to take control of their DeFi assets while using other protocols such as UniSwap and MakerDAO. Beginners in the world of DeFi will find InstaDApp very efficient.  

InstaDApp also functions as a DeFi platform that controls digital assets. It offers a myriad of  DeFi services such as borrowing, swapping, leverage, and lending. It allows you to integrate your services to serve your unique purpose and gives participants the option of a one-click switching platform to help them alternate from higher rate lending platforms to cheaper platforms with lower interest rates such as platforms like Compound and Maker.


The compound is the leading algorithmic decentralized finance protocol that allows digital asset holders to deposit and borrow cryptocurrencies against collateral and still earn interest in the process while automatically modifying its position based on the current rate of supply and demand.

The Compound makes this happen by generating liquid money markets for crypto while using algorithms to establish the rate of interest. From any location, borrowers can gain access to their assets for the purpose of borrowing. The process of Ethereum wallet Protocol integration is easy and can be activated from Compound's website.


AAVE is an open-source protocol based on Ethereum and therefore allows the seamless creation of decentralized money markets.

Liquidity is created on the platform when depositors fund lending pools with their own cryptocurrencies which then yields them interest. After this has happened, borrowers can get loans when they access the lending pools through either undercollateralized or overcollateralized methods. These loans are not restricted in any way and do not have to be between one lender and one buyer. Once the deposit enters a pool, it automatically has the potential of becoming a loan.

Presently, AAVE is one of the most popular platforms for DeFi borrowing and lending services such as Flash Loans, uncollateralized loans, and unique collateral types.


The acronym C.R.E.A.M stands for Crypto Rules Everything Around Me. This open-source crypto Finance platform is a DeFi ecosystem that was built on the Ethereum blockchain using the compound protocol.

It serves the specific purpose of providing asset tokenization, lending, and exchange payment services and as an open-source protocol, it has the unique position of giving access to developers who are currently helping the network expand as opposed to the alternative If just storing up funds in a smart contract while waiting for it to yield staking rewards.

Compared to the other platforms, CREAM is new but they are aggressively acquiring assets on their platforms whilst boosting the value of their tokens.

Final Notes

The application of DeFi in day to day dealings continues to grow in leaps and bounds. New innovations in the world of decentralized finance and increased participation beckons a future where the nuanced processes of finance will be securely and entirely returned to the hands of the people.

DeFi, its ecosystem, and platforms are steadily evolving into a crypto sector that is harnessing a massive influx of assets that are all secure in smart contracts. Currently, there are a lot of different new forms of other DeFi projects that are proliferating the platform, however, payments, lending, and decentralized exchanges will always remain the most profitable sectors.

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