What is HECO chain?
HECO is the native token of the Huobi exchange. If you have used Binance and BNB, and participated in anything in the BSC network then you know exactly what HECO is. Huobi is one of the biggest exchanges in the world and quite popular, they have their native token HT just like BNB and it is used for discounted trading at Huobi.
With the introduction of HECO, they have created their alternative platform to ETH, so that people could use smart contracts in their network for cheap and process faster. As we all know ETH reached all-time high gas prices which resulted in many layer 2 projects. The alternatives are usually based on layer solutions, whereas exchanges created their own projects to provide alternative blockchains with higher TPS.
HECO is exactly the solution to this problem, it is fast, it can carry more load and it has a good ecosystem that all of us could use. At the end of the day it is not used as much as ETH or even BNB but it provides a good alternative to both of them.
What are the best DeFi projects on the HECO chain?
Ecosystems in the DeFi world is dime a dozen, there are tons of them around but rarely do we get to see them, partner, up together to build even a bigger one. MDEX is a great decentralized exchange as you can understand from the name. Just like how BSC has Pancakeswap, and ETH has Uniswap, the HECO chain has MDEX.
This means there is a good amount of support directly from Huobi itself and there is also a big community growing there as well. The volume numbers and liquidity at MDEX may not be comparable for the other two counterparts, that much is true however, there is the fact that the rate that it increases surpasses everything else. This is why MDEX offers great potential for the future.
Imagine getting into Cake or Uni early on. Obviously, the success of MDEX depends on the success of HECO, which is not guaranteed. Knowing how China approaches crypto and how Huobi is headquartered in China, it is not going to be easy to trust completely and wait long term for it to grow rapidly for a long time.
With a $0.80 price per token, and a great repurchase/burn method, they keep the aim at creating a token that would be needed and used and invested yet also keeps growing smaller or at least growing bigger slower. This causes the token to be a lot more valuable, and in a world where it is printed a lot slower (or even grows lower) with more attention towards MDEX, it could create a big price increase as well.
When you think about yield optimizers, you think about Beefy finance. It allows you to invest in liquidity farms and it reinvests your earnings to increase the yield you earn. This way you do not have to keep on restaking your profits, and the growing size means you get to earn more and more with the same return just because you automatically reinvest.
Yield optimizers became a lot more famous after Beefy started, but in the end, Beefy stayed as the most commonly known one, and that’s where it still stands. With a multi-chain approach, Beefy exists in BSC, AVAX, MATIC, FANTOM, HARMONY, ARBITRUM, and many other chains. HECO is another one of these chains. With multiple options and a great return that you could not find anywhere else, HECO yield optimizing at Beefy became one of the most known versions.
Obviously, this was due to the popularity of Huobi and Beefy getting together. Mdex also took part in it by providing the pairs and liquidity as well. If you want to invest in liquidity farms over at the HECO chain, Beefy is definitely the most profitable version.
Lending platforms in the crypto world has grown exponentially since DeFi world started. It allows people to provide collateral with the cryptocurrencies that they own, and take out a loan. You could then use that for liquidity mining, staking, getting DAO (stablecoin), or any other method that systems offer.
This exists in all the other chains and at least one project does it, usually multiple projects. LendHub is the Huobi version of these lending platforms. You could get loans in the HECO chain, by using HECO chain tokens there. The rates are not bad at all, and you could repeat it with the tokens that you get from the loan as well.
This results in getting even more loans and allows you to leverage your lending but also increases the risk you take a lot as well. Certainly, a good adaptation of the lending projects in other chains, if you are familiar with the concept then it is worth checking it out.
We have talked about EarnDeFi before on our platform. As a Chinese project that is mainly in Chinese and focuses on Chinese adoption, it has a very limited community. Obviously, it is enough for them to sustain because of the population, so community numbers are doing alright for them. However it is not looking to be a global approach for them right now, it is certainly not a bad option for now, but in order to grow bigger, they will need to start becoming more inclusive.
English websites are the first step to take in this regard, even though there could be more people speaking Mandarin than English in the world, it is also not known in more nations so it creates a bottleneck of growth for them. As a decent decentralized finance project, their token is in multiple chains and they offer investment opportunities in quite a few networks.
This results in them becoming even better with cross-chain options and bridge capabilities. This means one person could both exchange their tokens across networks but also could earn in all of them on just one website. The idea is definitely something that could sustain the test of time, but growth requires more global community as the first order of business.
As a yield aggregator, AUTO offers people to find all kinds of yields all in one place instead of going to each website. You like the X project, and you like the Y project, so you go to each of their websites, whereas with AUTO both X and Y could be invested in the same place. This also increases a lot with tens of projects, even dozens in other networks to be listed there meaning you do not even have to research for pools to farm.
This is why AUTO has seen an increasing amount of volume over the course of years. Not just because they are good at what they do, which they are, but because they allow people to limit their research time and find things in just one place as well.
They offer this platform for the HECO chain as well, meaning all the good projects in the HECO chain could be all found together in the same place if you would like to invest. Diminishes all the need to look out for any projects because it services them right to your door.
As an AMM (automated market maker) Makiswap aims at giving people a reward for their participation in creating a market. If there are pairs that need to be swapped that require liquidity in both parts and as investors put up their own funds for that to happen, they earn rewards for each swap that happens there.
It is based on a unilayer ecosystem and provides liquidity offers for the Heco chain as well. With an aim towards building a project that could increase the adoption rate of the HECO chain, it certainly has a big mountain to climb. Alternatives in other networks already reached tens of billions of dollars combined.
This means that MakiSwap is doing great according to HECO chain general metrics, but to become more known will require a lot more liquidity provided from them. AMM is a good method to create such a thing instead of just one focus you get a wider focus. However, it also thins the lines of multiple options with small liquidity or smaller options with lower liquidity. Over time it will certainly grow bigger and solve all of their problems, with more adoption will come more liquidity and funds, which will make them even bigger.
We have talked about cross-chain platforms on the HECO chain, we have also talked about lending platforms as well. Now it is time to talk about a project that is both cross-chain and also a lending platform together. Filda is a project based on the HECO network, however, it is a cross-chain promise right now and not a reality.
They are working on the HECO network and they are working to add Polygon as their next step. So the idea of a “cross-chain lending platform” is unfortunately not there as of right now. This did not decrease their popularity because there is a promise and development being done on Polygon as the first known addition. This will probably be followed by other networks and it will become a bigger cross-chain platform.
Meanwhile, their lending platform works as intended, you could deposit many tokens or could simply get in with their own native token as well. Then you could use them just like any other lending platform. A project that has a big promise, a great potential and a good amount of following for such an early stage, Filda is something that anyone in the HECO chain should keep an eye for. Any big new development could mean a breakthrough for it, or any error of judgment or problems could be the demise of it as well.
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HECO chain could be smaller than its counterparts in other networks, it may not have the vast size that its competitors have as well. However with a big company like Huobi and a big market like China the project is still yet to achieve its peak. This means that we may not know if it will ever crack the top place, but it certainly has a good claim for third place behind Uni and Cake.
This means if the network succeeds that will come from the parts in the ecosystem. What are those parts? The projects within the network. This means if Huobi achieves what they are trying to do here, that will be based on the growing popularity of the projects under their roof. In the end, anyone who invests in the HECO network doesn’t just believe in the success of the network, or the potential of the network, but also projects within that network as well.
If you believe that the project itself is a great one, then the network part will become a null topic, because any good project could become successful in any network. However, even the greatest networks are filled with bad projects. This means when you want to invest, check the project first, then check the network later on.
If any of these projects result in some curiosity for you, then I strongly suggest doing further research into it and focusing on the project itself instead of HECO directly. Shortly, do not invest in anything in the HECO network just because it is in the HECO network, that would be a surefire way to lose your investment.
CaptainAltcoin's writers and guest post authors may or may not have a vested interest in any of the mentioned projects and businesses. None of the content on CaptainAltcoin is investment advice nor is it a replacement for advice from a certified financial planner. The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of CaptainAltcoin.com