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Best DeFi Projects on Avalanche: Where to Stake and Yield Farm AVAX and Stablecoins in 2022

Here's where to find the best rates on staking and yield farming AVAX and stablecoins in the Avalanche network DeFi ecosystem.

Best DeFi Projects on Avalanche: Where to Stake and Yield Farm AVAX and Stablecoins in 2022
Photo by Krzysztof Kowalik / Unsplash

Avalanche Introduction

Avalanche (AVAX) is a fast, low-cost, proof-of-stake platform for creating scalable crypto projects that use smart contracts. At launch, Avalanche was funded by established crypto firms, and following its major mainstream adoption in 2021, institutional money poured into the Avalanche ecosystem.

Avalanche has $10B in total value locked (TVL) across 177 projects, including: decentralized exchanges (DEXs), lending protocols, yield optimizers, games, bridges, and DAOs. Avalanche's utility token, AVAX, has a $20B market cap.

Where to Stake and Yield Farm AVAX and Stablecoins

For users looking to hold onto AVAX or synthetic AVAX while earning high yields, Avalanche's decentralized finance (DeFi) ecosystem has several established projects offering yields as high as 50% APR from pools with over $10M in liquidity. Avalanche's strong DeFi ecosystem also requires stablecoins, and investors looking to earn crypto yields without exposure to the crypto market can earn 35% farming stablecoins in Avalanche.

These Avalanche DeFi projects offer the highest yields while maintaining reasonable liquidity–at least $5M and usually above $10M.

Protocol TVL AVAX only* AVAX-Stablecoin Stablecoin-Stablecoin
Trader Joe $1.4B 12% 30% 6%
Yield Yak $343M 9% 54% 16%
Pangolin $206M 12% 46% -
Platypus $1B - - 31%

* Includes AVAX-native staking, synthetic AVAX, and liquidity provider pairs based on AVAX that have no impermanent loss

Trader Joe (JOE) is an established DEX operating exclusively on Avalanche. At $1.4B TVL, Trader Joe has the most value locked among Avalanche-native DeFi projects. Trader Joe offers strong yields for AVAX holders, offering yields of 12% for AVAX single-token staking and 30% for AVAX-stablecoin farming. Trader Joe offers weaker than average stablecoin farming yields. Investors are paid in Trader Joe's native token, JOE. JOE has a $200M market cap and 36% of all JOE tokens are currently in circulation.

Yield Yak (YAK) is a yield optimization platform with $343M TVL operating exclusively on the Avalanche network. Investors use Yield Yak to open and operate slightly leveraged positions on other protocols, such as Aave. Yield Yak automatically collects the yield from these positions on the other protocols, then reinvests it into the position. This leverage and automatic reinvestment allows Yield Yak to offer higher yields than an individual investor could achieve on the same platforms.

Yield Yak offers the best yields for AVAX-native staking, AVAX-stablecoin pairs, and stablecoin-stablecoin pairs. It's worth noting that using Yield Yak and similar products introduces additional risk, because it adds another custodian of your assets, in turn adding an additional point of potential failure.

Yield Yak pays investors in YAK and other Avalanche assets. YAK has a $14M market cap and 85% of all YAK is in circulation.

Pangolin (PNG) is a community-driven DEX on the Avalanche network with $206M TVL. Pangolin offers strong yields for AVAX holders, offering 12% for AVAX farming with no impermanent loss and up to 43% for AVAX-stablecoin pairs. Pangolin offers poor yields for stablecoin farmers. Pangolin pays investors in its PNG token, which has a $22M market cap, with 16% of the total supply of PNG in circulation.

Platypus Finance (PTP) is a stablecoin DEX operating on the Avalanche network with $1B in TVL. Yield farmers can invest stablecoins to earn around a 6% base rate on their tokens, plus an additional bonus yield that averages around 25%, bringing the total yield to 31%. Platypus pays investors in PTP tokens. PTP has a $107M market cap, but only 6% of all PTP tokens are in circulation. For investors who qualify for strong bonuses, PTP is a good stablecoin yield farming option.