What are DeFi Coins
DeFi Coins are, as can be assumed, cryptocurrencies that play a specific role within the field of decentralized finance, those finances in which there are no central counterparties, or the bare minimum.
For decentralized platforms to work properly, they have to hold DeFi Coins to pay transaction fees. This is why many exchanges of this type have their own tokens.
According to CoinMarketCap, there are currently more than 500 DeFi Coins available in the market for trading. While this is good news because it means that there is a great deal for investors to choose from, it also means that the choice can be confusing.
Are DeFi Coins a good investment?
It all depends on the investor profile of each one, their objectives and needs. However, in general terms, it could be said that DeFi Coins are a good investment alternative for those who are looking for a project with a lot of potential ahead, in exchange for a higher risk, obviously.
The vast majority of these cryptocurrencies are highly volatile, meaning their price can fluctuate wildly, both up and down.
With this in mind, there are a few points to consider in determining whether or not a DeFi Coin may be a good investment.
Growth of DeFi Coins
Many of the DeFi Coins mentioned throughout this article were born during 2020, the year in which the cryptocurrency market exploded upwards and gained great popularity.
This shows that this is a very new sector that is just beginning its growth phase , at which point investors can make a lot of money, just as bitcoin or ether did in their early days.
In addition, of the entire cryptocurrency market, DeFi Coins only represent less than 10% of the total, which further increases their potential.
Fundamentals of DeFi Coins
DeFi's fundamental idea is to decentralize traditional financial services from centralized providers like banks. Namely, in the near future, we could see everyday consumers borrowing from DeFi Development platforms, which are subsequently financed by investors.
This peer-to-peer business model may be applied to a variety of financial services, including insurance and brokerage deals. And, if decentralized finance reaches its full potential, then the best DeFi Coins will only benefit in the long run.
DeFi Coin Prices
As with other cryptocurrencies or conventional equity assets, DeFi Coins move according to the supply and demand of the moment.
When many buyers go out to purchase DeFi Coins, the demand grows, which drives their price up. And vice versa: if it is supply that increases, then prices will fall.
The reasons why supply and demand vary are many and no one can know exactly, since it is the sum of the fears and hopes of all market participants.
Where to buy DeFi Coins
eToro: comprehensive and affordable broker to exchange euros for crypto
Founded in 2006, eToro has slowly grown to become one of the largest financial brokers in the world. Today, it allows you to operate all kinds of assets, so it is used to buy DeFi Coins.
In addition, what is attractive about the broker is that it has a community function that allows you to “copy” investment strategies, an activity that is known as “social trading”. Basically, with this tool we will be able to emulate the portfolio and the movements of other experienced operators, which will help us to earn money.
Another interesting point about eToro is that its platform supports both novice market participants and experienced traders. The software is perfectly optimized and mixes the best of design with maximum functionality.