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As outlined in the 2024 outlook BNB Smart Chain (BSC) is focused on building an infrastructure that supports its DeFi ecosystem. Our goal is to provide developers with the tools and a high-performance platform that can easily support their applications and visions. Today, let’s examine the existing DeFi ecosystem to check out some of the top-performing DeFi apps by total value locked (TVL). We will check the top Dapps on both BSC and opBNB.
DeFi on BSC
The DeFi ecosystem on BSC currently accounts for over $8.5 billion in TVL. PancakeSwap and Venus are the largest DeFi apps on BSC and account for ~62% of the overall TVL. Let’s take a look at the top 5 DeFi apps on BSC by TVL.
PancakeSwap
TVL on BNB: $3.04 billion
Token: $CAKE
PancakeSwap is a decentralized exchange (DEX) that operates on both BSC and opBNB, specializing in the swapping of BEP20 tokens. This platform offers users the ability to trade tokens directly with one another, bypassing the need for traditional financial intermediaries.
Later this year, PancakeSwap is set to release its Version 4, which promises significant advancements aimed at making on-chain trading more cost-effective and efficient. This update will introduce the following four features:
- Hooks: These are externally deployed contracts that developers can use to introduce customizable features to the trading platform. By using hooks, developers can alter the types of fees charged and the nature of trading orders, such as converting them to limit or market orders. Additionally, fees generated through these hooks can be retained by the developers or distributed among stakeholders.
- Custom Pool Types: This feature allows for the creation of various liquidity pool options, enhancing asset price stability. By offering diverse types of pools, PancakeSwap aims to mitigate extreme price fluctuations during high demand or sell-off periods, ensuring more stable pricing under market stress conditions.
- Singleton: By merging all pools into a single contract, the singleton feature drastically cuts deployment costs by 99%. This consolidation also reduces the gas fees incurred during token swaps, as it eliminates the need to move tokens across multiple contracts.
- Flash Accounting: Aimed at reducing overall gas consumption, flash accounting processes transactions in batches. This approach is particularly advantageous during periods of high market volatility when gas prices can spike and potentially restrict trading activities due to high costs.
Venus
TVL on BNB: $2.23 billion
Token: $XVS
Venus Protocol is an innovative algorithm-based money market system designed to facilitate decentralized lending and borrowing of cryptocurrencies. The protocol leverages its native governance token, XVS, which holders can stake in the Venus Protocol Vault to earn rewards, thereby allowing its community to own and control the protocol.
Functionally, Venus Protocol creates a dual opportunity for BNB Chain users: those with idle cryptocurrency can lend it out by supplying collateral to the network, earning compounded annual interest rates in return.
On the other hand, those in need of liquidity can borrow funds by providing over-collateralized cryptocurrency as security, from which they accrue interest on their loans. The interest rates for both lending and borrowing are dynamically adjusted based on market utilization, following a curve yield system that responds to real-time supply and demand dynamics for various cryptocurrencies like BNB and ETH.
Another key feature of the Venus Protocol is its ability to mint synthetic stablecoins using vTokens, which are tokens representing the collateral supplied by users. For example, supplying USDT to the protocol earns the lender vUSDT tokens, which can be redeemed for the original collateral or used to mint the protocol’s native stablecoin, VAI.
Aave
TVL on BNB: $49.27 million
Token: $AAVE
Aave is a pioneering DeFi platform that facilitates open-source, non-custodial liquidity markets where users can earn interest on deposits and borrow assets. Currently, it’s the third largest DeFi app in the world by TVL, trailing only Lido and EigenLayer (as per DeFiLlama).
It operates on a system of overcollateralized loans, meaning borrowers must deposit cryptocurrency of greater value than the amount they wish to borrow. This mechanism safeguards lenders by allowing the protocol to liquidate the collateral if its value declines substantially, thereby mitigating the risk of defaults. Aave also features its own native cryptocurrency, AAVE, which users can trade on various exchanges or stake directly on the Aave platform to earn additional interest.
The introduction of Aave V3 brings significant enhancements to its underlying architecture through a series of smart contracts designed to optimize operations and reduce costs, particularly beneficial for layer 2 (L2) rollups.
Aave’s presence on BNB Chain gives users a reliable and market-tested DeFi app with which they can interact with ease without fear of loss of funds.
PinkSale
TVL on BNB: $265.72 million
Token: $PINKSALE
PinkSale is a decentralized launchpad that serves as a leading platform for users to create their own tokens and manage initial token sales without needing coding expertise. PinkSale has a strong performance history, having successfully facilitated over $1 billion in funding for more than 20,000 projects, attracting millions of investors each month.
Beyond being a top choice for launching token sales, PinkSale is committed to providing a secure environment for its users. The platform emphasizes investor safety through the implementation of strict KYC procedures to prevent fraudulent and deceptive activities. Our primary concern is ensuring that investors feel protected and confident that PinkSale is a reliable and safe platform for engaging in crypto projects.
DeFi on opBNB
When it comes to the DeFi ecosystem on opBNB, KiloEx rules the roost, accounting for a mammoth 56.21% of the overall TVL.
KiloEx
TVL on opBNB: $14.43 million
Token: $KILO
KiloEx is an innovative peer-to-pool perpetual DEX. KiloEx distinguishes itself by offering users access to high-leverage options, a wide array of trading pairs, and advanced hedging tools. Additionally, it introduces unique features like decentralized referral systems and copy trading, aiming to cater to a broad spectrum of traders from novices to experts.
One of the key advantages of KiloEx over traditional and even other decentralized exchanges is its robust approach to minimizing liquidation risks and providing rapid transaction capabilities. The platform combines the agility of fast trade executions with the security and transparency of blockchain technology, ensuring real-time tracking of market activities and an intuitive trading interface.
Perpetual DEXes like KiloEx are ideally suited for opBNB since the platform offers low fees and high speed. opBNB can handle over 4,000 transactions per second (TPS), while the gas fees on opBNB are remarkably low, bordering on being near gasless. These features make opBNB ideal for applications with high transaction volumes and use activities such as perpetual DEXes.
In Closing
BNB Chain, with its scalable and affordable platform, is attracting a rich and diverse DeFi ecosystem. The projects mentioned here are just the beginning. BNB Chain’s suite of builder support programs including the MVB Program, DAU and TVL Incentive Programs, and regular hackathons are a testament to its commitment to incubating and attracting promising projects. To learn more about building DeFi on BNB Chain, click here.
