In this article, I will discuss how to find multi-chain DeFi gems, focusing on strategies to identify high-potential projects across multiple blockchains.
As the DeFi space continues to evolve, multi-chain platforms offer significant advantages like reduced fees, increased liquidity, and better scalability. By understanding key features and using the right tools, you can uncover valuable opportunities.
Introduction Multi-Chain DeFi
Multi-chain decentralized finance (DeFi) refers to the combination of DeFi services over several blockchains. Unlike other DeFi projects that solely operate on a single blockchain, multi-chain DeFi has more enhanced interoperability which permits assets and data to move freely across different blockchains.
This advancement unlocks greater opportunities for users such as lower network traffic, reduced transaction fees, availability of various platforms and protocols, and many more. As the DeFi sphere continues to grow
Its multi-chain counterparts emerge with new and greater opportunities like improved scalability, advanced liquidity, and flexible options. In this article, we’ll look into how one can draw out valuable multi-chain DeFi gems and discuss strategies and tools that will help them understand and navigate through the growing ecosystem while maximizing profits.
How To Find Multi-Chain DeFi Gems
Scope out Defi projects that are New or Trending
Navigate to DefiLlama and click on “Chains” and then “Projects.” You can set the filter to “New” or “Trending” to look for new developments in DeFi protocols.
Analyze Their TVL Rate Growth
Look for projects that have an increasing pattern in TVL over time. TVL per chain is also good to check for growing ecosystems around the various chains.
Try to Find Yield Pitches
Get high APY pools in DefiLlama’s “Yields” section. Make sure liquidity depth, risk factors, and sustainability are all verified.
Keep Remaining Bridges Cross-chain
Track liquidity within the chains. Try to find growing ecosystems that are sponsoring new DeFi protocols.
Research About The Project
Pick a specific protocol and analyze the chains it has been deployed on. Ensure audits and teams’ credibility along with tokenomics are done prior to investing.
Strategies for Finding Promising Multi-Chain DeFi Gems
Utilize DeFi Aggregators & Market Data Providers
Track the development of various multi-chain initiatives and observe their market cap, trading volume, and liquidity using DeFi Pulse, CoinGecko, and CoinMarketCap.
Check For Multi-Chain Trenched Projects
Search for multi-chain intra-DeFi projects that go as far as cross-chain interoperability, allowing the movement of assets and liquidity without restrictions within chains including Ethereum, BNB, or Solana.
Evaluate Their Tokenomics and Use Cases
Examine the tokenomics of the project in terms of total and circulating supply. Ensure that there is tangible utility for the token within various chains which includes governance, staking, and liquidity.
Analyze The Development Team And Their Partnerships
Check the expertise of the development team and assess the partnerships to look for potential clues of growth. Credible teams and partners are usually associated with strong projects.
Monitor The Liquidity And Overall Market Activity
Observe the liquidity available on decentralized exchanges (DEX) from other chains. Increased liquidity and trading volumes indicates that there is a market for the project.
Take A Look At Cross-Chain DeFi Services
Look out for services with multi-chain presence that provide multiple DeFi offerings like yield farming, lending, or swapping on different chains. Examples include SushiSwap and Yearn Finance.
Explore Analytics Using the Blockchain
Use on-chain tools such as Dune Analytics, Nansen, and Glassnode to monitor health-related metrics like active addresses, developer activity, and fund flows for any given project.
Social Network and Community Involvement Tracking
Monitor project updates, overall sentiment, and community involvement at the social networking sites such as Twitter, Telegram, and Discord. A well-engaged community usually translates to better growth.
Evaluate the Roadmap Alongside Real-World Applications
Check for the project’s forecasted roadmap milestones and validate that it is meeting its development objectives. Prioritize projects that offer defined real world use cases and have a defined vision for the decades ahead.
Engage in Pre-Marketing IDO or ICO Funding
Join in ICO or Initial DEX Offering (IDO) events for access to multi-chain DeFi gems at the forefront of maturation. These avenues provide the opportunity for early stage investment along with higher risk.
Tools and Platforms to Identify Multi-Chain DeFi Gems
DeFi Pulse
One of the best tools for tracking DeFi projects, DeFi Pulse ranks multi-chain protocols by Total Value Locked (TVL) and provides analytics on the growth of emerging DeFi ecosystems across blockchains.
CoinGecko
Provides analytics for a wide range of DeFi project features like market cap, liquidity, trading volume, and performance across different blockchains. It’s a helpful tool for spotting and monitoring multi-chain DeFi gems.
Dune Analytics
Offers customizable on-chain data and analytics. Dune allows you to track transaction flows, active users, and liquidity across multi-chain DeFi projects which gives you better insights into their performance and potential.
Nansen
It is an advanced blockchain analytics tool that tracks wallet, developer, and token flow activity. By offering robust data on market and user behavior, Nansen helps you discover high-potential multi-chain DeFi projects.
Uniswap/PancakeSwap
These two decentralized exchanges (DEXs) are crucial for finding newly launched tokens and liquidity pools DeFi projects across various blockchains. They usually offer newly launched multi-chain DeFi projects that give insights on market movement in real-time.
Key Features of Multi-Chain DeFi Gems
Interoperability
With the development of multi-chain DeFi gems, there is free movement of data and assets between chains such as Ethereum, Solana, and Binance Smart Chains. This allows users from different ecosystems to have more liquidity and opportunities.
Scalability
The availability of multiple chains to harness helps to reduce congestion and lower transaction fees. With this, multi-chain DeFi projects have lesser scalability issues. It ensures users are well catered to during heavy network demand.
Cross Blockchain Liquidity
Users can trade, lend, and borrow assets freely across different blockchains, and it`s not limited to a single blockchain liquidity pool. This enables cross-chain asset interaction.
Reduced Transaction Fees
Unlike Ethereum which has high gas fees, multi-chain DeFi projects are built on cheaper blockchains such as Polygon and Binance Smart Chain. These projects have lower transaction fees.
Decentralized Governance
Community participation in governance via submission of proposals and voting is allowed for most multi-chain DeFi projects. This is made possible through holding governance tokens for the protocol.
New Financial Services
Multi-chain DeFi gems add to the diversity and functionality of the ecosystem because they usually come with new features like synthetic assets, yield farming across different chains, and Automated Market Makers (AMMs).
Reducing Risks and Enhancing Security
Multi-chain projects bolster the security of users’ funds through advanced smart contract mitigation are added, together with cross-chain auditing and integrated security audits.
Conclusion
To sum up, the process of searching for multi chain DeFi gems is an insightful process, it starts with researching, strategizing, and evaluating various factors including interoperability, liquidity, and tokenomics.
Crossing chain boundaries using analytics aids greatly in discovering DeFi projects with great potential. Long term investment value is, and always should be supported, however, community sustainability and utility are of utmost importance.
