Invezz is an independent platform with the goal of helping users achieve financial freedom. In order to fund our work, we partner with advertisers who compensate us for users that Invezz refers to their services. While our reviews and assessments of each product on the site are independent and unbiased, brands may pay to appear higher up our table rankings or place ads in specific areas of the site. The order in which products and services appear on Invezz does not represent an endorsement from us, and please be aware that there may be other platforms available to you than the products and services that appear on our website. Read more about how we make money >
Invest in defi coins
Ways to invest in defi coins
If you want to invest in defi coins, the first thing you will need to do is register with an online broker or exchange. Most often, an exchange is the best place to buy, as that’s where you will find the biggest variety of coins. Exchanges are like giant marketplaces where you can buy, sell, and trade coins with other investors 24/7.
There are different brokers and exchanges available and they all offer a range of features and services. Some require you to buy a mainstream coin such as BTC or ETH before you can exchange for a defi coin. While others offer wallets where you can securely store your coins. There are other methods available such as ETFs and if you want to learn more, check out the links below with useful information to help you get started.
What is a defi coin?
A defi coin is a cryptocurrency that offers financial services and is based on a public blockchain. Defi is short for decentralised finance, unlike traditional finance (TradFi), defi has no central authority. Defi coins can be used for the same purposes as fiat currency, without the need for a third party.
One of the key benefits of using a defi coin is the use of blockchain technology within the financial services sector. You can invest, save, pay, borrow, and lend all without needing to use a bank. All of this is made possible by using blockchain networks and smart contracts resulting in a fairer and much faster transaction process.
Smart contracts are the backbone of decentralised finance. These contracts are programmed to execute functions automatically. For example, when you make a payment via a bank using traditional finance methods, a series of third party checks occur before funds are sent or received. Using a defi coin to make the same payment would speed up the process and eliminate errors and fees, because the rules are programmed in.
How do defi coins work?
They use blockchain technology to replace the role that is played by a bank in the traditional financial system. While each coin is different, they generally use a system of incentives to encourage people to provide the collateral that allows them to offer financial services like trading and lending, and then control of the network is spread out among its users.
This decentralisation, achieved by giving those who own coins voting rights to shape the future of the project, means that these projects work very differently from the traditional system. There is no single point of authority that can act as a gatekeeper to deny someone access to the service, and blockchains ensure that all transactions are fast and transparent.
Often these projects use smart contracts (agreements that are written in code) to set the rules for exchange rates, interest payments, and other financial transactions. These contracts execute automatically and can allow the coins to offer a better service than a similar company in the traditional world.
Examples of DeFi coins
The number of defi coins continues to grow and each one offers different benefits and uses. Below are a few examples of some of the top defi coins available.
- Binance coin (BNB): The native coin of the worlds largest crypto exchange Binance, is one of the top defi coins around. BNB operates on its own blockchain, BNB Chain and offers access and discounts to other coins on the Binance exchange. You can learn more about BNB in our guide here. >
- Uniswap (UNI): Defi coin UNI, is the native token of decentralised exchange Uniswap. Users of UNI benefit from having their trades executed directly on the ethereum blockchain. Unlike regular exchanges, Uniswap is not governed by a single authority. To learn more about UNI, you can visit our detailed guide here.>
- Terra (LUNA): The Terra platform offers a payment system that is completely decentralised and is underpinned by its native coin, LUNA. The network is designed to work on multiple blockchains and is currently live on ethereum and solana. It removes the need for banks, credit card networks, and payment gateways. For a detailed understanding of LUNA, you can check out our guide here. >
How to invest in defi coins?
There are a range of ways to invest into the crypto market and defi coins can be accessed using a few different methods. Below we’ve briefly explained the top ways to invest in defi coins.
- Brokers. One of the easiest ways to invest in defi coins is to use a cryptocurrency broker. These platforms are particularly useful if you want to trade coins using short term strategies. The best brokers have low fees and simple to use interfaces.
- Exchanges. Using an exchange lets you buy, sell, and trade coins with other investors or traders. Exchanges are like giant marketplaces with a range of coins available and often have the best and most up to date prices.
- ETFs. Exchange traded funds allow you to invest in a coin, or a selection of coins and can be traded on the stock market. ETFs are an easy way to get exposure to a range of cryptocurrencies.
Where can I buy defi coins now?
The best place to buy defi coins is through a broker. There are lots of brokers around and choosing the best one can be a difficult task. Our crypto experts have made your decision easier and selected some of the best rated platforms around offering defi coins. Simply click any of the links below to get started in just a few minutes.
Fact-checking & references
Our editors fact-check all content to ensure compliance with our strict editorial policy. The information in this article is supported by the following reliable sources.
Invezz is a place where people can find reliable, unbiased information about finance, trading, and investing – but we do not offer financial advice and users should always carry out their own research. The assets covered on this website, including stocks, cryptocurrencies, and commodities can be highly volatile and new investors often lose money. Success in the financial markets is not guaranteed, and users should never invest more than they can afford to lose. You should consider your own personal circumstances and take the time to explore all your options before making any investment. Read our risk disclaimer >