Economist Alex Krüger is revealing his top six decentralized finance (DeFI) picks heading into the new year.
Krüger tells his 56,600 Twitter followers that the decentralized exchange Uniswap (UNI), governance token Maker (MKR), DeFi lending platform Compound (COMP), lending and borrowing protocol Aave, derivatives liquidity protocol Synthetix (SNX), and DeFi yield aggregator yearn.finance (YFI) are the best projects in the space.
While Krüger believes that the DeFi space is producing high-caliber products, he warns that regulations can hamper the sector’s growth.
“DeFi faces potential regulatory burdens other tokens do not face. These generate short-term headwinds. Institutional investors aren’t yet able to invest in DeFi directly. DeFi assets are not available to Paypal or Circle investors.”
According to the economist, he expects DeFi to eventually overcome the short-term regulatory hurdles.
“Regulatory burdens and access limitations are tantamount to a lid on top of DeFi. This lid, these barriers of entry, are temporary. Once lifted, assets should outperform dramatically as new money pours in. The technology is revolutionary.
Until that happens, DeFi will remain dominated by crypto natives, who benefit greatly from BTC and ETH gains and recycle some of their windfall into other assets.”
In the meantime, Krüger tells his followers to look into other crypto assets as waiting for DeFi to post big gains while Bitcon and Ethereum grab headlines could be “psychologically taxing.”
“For those seeking for alternatives to BTC, the safer bets are LTC, BCH and ETH, as the SEC won’t label them as securities. Other tokens may.”
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