Trader and DataDash founder Nicholas Merten is unveiling his list of top 10 crypto assets to watch in 2021.
At number 10 on Merten’s list is Hegic, an Ethereum-based derivative options trading platform.
“As DeFi continues to grow, so will decentralized derivatives. Hegic provides the ability to deploy call or put options on cryptocurrencies like Ethereum… Considering the size and demand for options contracts in crypto as well as other asset classes, Hegic could be a major play going forward into 2021.”
Taking the ninth spot is Warp Finance which is a project that was able to weather a major storm this year. Warp was able to recover 75% of funds that were stolen in a flash loan attack and is preparing compensation for the victims and reaching out to auditing firms to improve the security of the protocol.
“Warp offers liquidity providers (LP) a way to lock up their LP tokens as collateral in order to borrow a wide range of stablecoins at favorable rates with incredibly low probability of liquidation. In the first week, the protocol attracted millions in LP token deposits.”
At number eight is DeFi Money Market (DMM) which Merten believes is solving an interesting issue.
“DMM is an open protocol that allows anyone to lock up their stablecoin of choice and earn interest on real world assets… What I like about DMM is that it flips the traditional model of banking on its head. Instead of the banks taking your deposits or savings and lending it out to borrowers, keeping the vast majority of interest income for themselves, DMM is collecting yield from assets contributing impactful value in the economy and granting the vast majority of those earnings back to its depositors.”
Coming in at number seven is Unibright (UBT) which Merten refers to as “a major heavyweight in the world of enterprise blockchain.”
“Enterprise blockchain in my opinion is one of the major sectors of crypto that doesn’t get enough attention and for Unibright, it’s the project’s area of expertise. Starting off with the Unibright framework, Unibright was able to provide a way to automate and dramatically simplify smart contract generation for enterprise companies, building a name for themselves in the space and removing immense barriers to blockchain development for enterprise companies.”
Sixth on the list is decentralized exchange project Loopring. Merten says the protocol has gone through a number of major improvements in 2020.
“[Loopring upgraded] its structure to become an automated market maker or AMM and implemented its own custom solution of zk roll-ups, allowing for over 2,025 trades per second, each costing less than a fraction of a penny.”
Taking the fifth spot is Synthetix-based asset management protocol dHEDGE (DHT).
“dHEDGE allows anyone to become a virtual, permissionless hedge fund, giving you the ability to create synthetic portfolios, powered through the Synthethix protocol. People or groups can come together to attract capital by offering lower management fees, providing better market performance through their portfolio management.”
Landing at number four is decentralized oracle network Chainlink (LINK).
“Chainlink’s biggest proposition outside of its industry-leading technology is its overwhelmingly large community of partners that it’s been building over the last few years… I’m highly confident (LINK) could reach heights similar to Ethereum’s highs in 2017.”
Taking third place is Uniswap (UNI), the largest automated market maker in the DeFi space according to Merten.
“With the growing number of liquidity providers on the platform, the wide range of supported tokens, and its relatively low fees, it has become superior to many major exchanges, even outpacing the daily volumes of companies like Coinbase.”
Number two on Merten’s list is Ampleforth (AMPL).
“Think about [Ampleforth] like a central bank on the blockchain that issues new notes or Ample tokens when the price increases over a dollar, all the while not diluting your wealth through inflation when issuing those new tokens. Ampleforth can also do the opposite, deflating the supply when prices drop below a dollar. And its peg can be adjusted usually to meet the level of inflation that the real US dollar has faced since the launch of its protocol in 2019. For example, the current peg is a dollar and one cent.”
According to the analyst, Ampleforth offers an interesting use case in the form of stability as people in the DeFi space look for stable assets for collateral or for wealth preservation.
At the top of the list is Ethereum (ETH), which Merten says has great growth potential with minimal risks. He also highlights that all DeFi projects and tokens that are part of the list live on the Ethereum blockchain.
“With the preparation for ETH 2.0, its long-term game plan to scale to thousands of transactions per second while also shifting its consensus mechanism to proof of stake, which brings dramatic decreases to energy consumption, Ethereum is setting itself up for major success in the long run…
If this update goes live and the transition is smooth, it will likely forever solidify Ethereum’s lead in the competition of blockchain protocols. Increased transaction throughput and staking rewards will provide immense buy-side pressure for Ethereum as an asset.”
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Featured Image: Shutterstock/Tithi Luadthong