5 Cheap DeFi Cryptocurrencies To Buy Right Now

Last Updated August 30th 2021

7 Min Read

DeFi is one of the fastest-growing segments of the crypto economy. The amount of money locked in DeFi has shot up from $7 billion to $82 billion in the past year alone.

This has been driven by the huge gains this market offers, and its potential to re-shape how banking and finance have been conducted for centuries.

5 Cheap DeFi Cryptocurrencies To Buy Right Now

Aave (AAVE)
0X Protocol (ZRX)
Augur (REP)
Hegic (HEGIC)
Yearn Finance (YFI)

1. Aave (AAVE)

Given the growth prospects that DeFi presents, investing in cheap cryptocurrency Aave (AAVE) now makes a lot of sense.

It’s an open-source, non-custodial DeFi protocol that allows investors to earn interest on their deposits and borrow against their crypto assets.

One of the Aave protocol benefits that makes it attractive to investors is that it allows one to deposit and borrow against multiple cryptocurrencies.

For people who want value growth without exposure to the volatility of the crypto market, Aave allows investments through stable coins such as USD Coin, USDT, DAI, and Gemini Dollar.

Aave also has the benefit of security. Recently, several DeFi projects have been hacked, and millions of dollars in investments lost. The latest one is where the smart contract of a project was exploited and over $600 million lost.

Aave does not have this problem because it is non-custodial. This means the project never takes control of an investor’s assets. You get to borrow and lend while retaining control over your assets.

Aave is also popular because it gives investors the ability to borrow cryptos without having to own them. Essentially this means investors can earn from trading on borrowed cryptocurrencies without exposure to the volatility risk that comes with owning them outright.

Aave is also one of the DeFi projects that allow investors to choose interest rates. Users can choose between variable and fixed interest rates depending on their goals and risk appetite.

Since this protocol is non-custodial, it does not take investors through things like KYC or credit checks. Provided one has crypto assets, they can lend or borrow against them regardless of who they are or how good or bad their credit history is.

This means Aave is giving exposure to the finance world to people that would probably never get served in centralized finance. For instance, someone with bad credit for whatever reason may find it hard to access a loan in a bank, even when they have collateral. With Aave, they can use their assets to get the liquidity they need.

A combination of these factors makes Aave a highly undervalued DeFi project with a lot of potential for growth going into the future.

However, like all other crypto projects, there are risks associated with Aave. One of the most significant risks to this project is adverse regulations. The US infrastructure bill, for instance, could create complications for projects like Aave on KYC.

The good news is that the US Treasury has moved to reassure that the application of the law will take cognizance of such issues. This is a reprieve and opens the way to the potential explosion in value for Aave going into the future.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

2. 0X Protocol (ZRX)

A top decentralized exchange

0X Protocol (ZRX) has performed pretty well over the past month. From lows of $0.72 in July, it is currently trading at $1.08 and gaining.

0X is basically a decentralized crypto exchange that allows for the peer-to-peer exchange of ERC-20 tokens. While there are multiple DEXs, 0x is one of the most competitive in the DeFi space.

One thing that makes it stand out is that it is more gas efficient than other protocols.

The reason why it’s gas efficient is in the way it settles transactions. Unlike other DEXs that settle transactions on-chain, 0x does it in a hybrid system. Transactions are relayed off-chain but settled on-chain.

This means that no orders are settled on the blockchain. Only settlements take place on the blockchain. If someone wants a counterparty to their trade, they can contact them via email, chat, and other forms of communication and get the order done.

Considering how expensive Ethereum gas prices can become, the ability to save on gas will play a critical role in the long-term growth of 0x.

The other hugely attractive feature of this blockchain is the duo utility of the 0x token. The token is used for governance and staking.

In terms of governance, anyone who holds this token can vote on the direction that the project should take going into the future.

However, the biggest use case for this token that makes it attractive to investors is staking.

Back in 2019, this cheap, but high potential cryptocurrency project changed its tokenomics in a bid to improve liquidity on the platform. The change introduced allowed market makers to be rewarded with fees for putting liquidity in the system.

This has allowed a lot of investors to make a passive income off the 0x ecosystem. At the same time, it has created a scenario where liquidity will also be available for traders.

This is a big deal not just in terms of short-term staking rewards but the overall growth of 0x in the DeFi ecosystem.

To compete and win, a DEX needs to have the liquidity that rivals centralized exchanges and centralized financial systems.

By incentivizing market makers, 0x has ensured that it will win in this market long term. This makes it hugely undervalued at current prices, given that DeFi is only getting started.

However, it is essential to note that 0x has competitors. Nonetheless, its core fundamentals look pretty good. It definitely has a future in the first growing DeFi space.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

3. Augur (REP)

A cheap predictions markets cryptocurrency

Augur (REP) could be another top cheap cryptocurrency to buy today. The predictions markets are a huge part of DeFi, and Augur has emerged as a market leader in this space.

Since its launch, Augur has always drawn investor buzz because the idea in itself is exciting. The ability to make money from making predictions on everything from crypto prices to political events makes Augur one of the most innovative projects in DeFi.

One thing that makes this project a high potential buy at current prices is its strong partnerships.

Since its launch, the project has partnered with several top names in crypto to help in its long-term growth.

For instance, it has a partnership with Airbitz for security purposes. This partnership allows Augur to offer prediction services in an encrypted environment. Considering the losses that can ensue if a predictions market is compromised, security is a big deal to the long-term success of Augur.

Security coupled with a focus on an exciting segment of DeFi makes Augur relatively cheap crypto to buy now.

However, it is important to understand that like every other project out there, Augur has its risks. The biggest one is that due to the project’s slow development, it is yet to gain traction in terms of adoption.

There is no crystal ball to tell the direction it could go in the future.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

4. Hegic (HEGIC)

A decentralized options platform

Hegic (HEGIC) is a relatively new project but is targeting a very lucrative market. Hegic is a protocol that allows investors to trade in options in a decentralized environment. Essentially, it has taken options, one of the biggest components of centralized finance, and put it on the Ethereum blockchain.

Besides tackling a very lucrative market, Hegic has some fascinating internal fundamentals too. For instance, it allows traders to make put and call options without being charged gas fees. This means options trading on Hegic is cheaper than doing so on centralized platforms.

It’s a factor that could play into its potential for adoption in the long run. However, it is important to note that this is a relatively new project and is yet to gain much traction. Therefore, there is no telling how issues like competition or regulations could affect its success long term.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

5. Yearn Finance (YFI)

A decentralized asset management project

DeFi is decentralizing asset management, and Yearn Finance (YFI) is right in the middle of it.

Yearn offers investors multiple ways through which they can grow their crypto holdings. Through the Yearn protocol, investors know where they can get the most yield for their money.

The best part is that the protocol supports stable coins, which means it is possible to maximize on returns without exposure to crypto market volatility.

Yearn has also been on an expansion path in the past year, and in the process deepened its intrinsic value. For instance, through its partnership with Cream, Yearn was able to give its investors the ability to make money through leveraged yields.

Yearn’s multiple earning pathways, coupled with the growing adoption for DeFi makes it a highly undervalued and cheap cryptocurrency to buy now.

The only risk to Yearn could be regulations. DeFi regulations are unclear in most major economies at this point. It would be impossible to tell how adverse regulations could affect projects like Yearn.

Check Out: Could Yearn.Finance be a Millionaire-Maker Coin?