According to Defillama, the total value locked in all protocols across the decentralized finance ecosystem is close to $119 billion. The current trends indicate a significant uptick since 2024 with an approximate growth of 120%. We are still below the ATH achieved by the end of 2021 when the combined TVL of the ecosystem spiked above $177 billion. As the saying goes, if there is money, there is money to be made.
It is hard to identify the best approach to crypto investing as one has to consider not only potential profitability but also risk management in DeFi which is not easy at all. Since each protocol that promises juicy earnings must be researched separately if you are interested in allocating your funds smartly, the analytical process often demands significant time and effort on the part of an investor.
We will talk about some of the most popular and effective staking and lending strategies as well as some other opportunities to earn money in DeFi. However, we have to remind our readers that doing your own research is hugely important. We do not provide actionable financial advice and explain various investment approaches for strictly educational purposes.
The world of DeFi is incredibly complex. In 2025, you can find over 5200 tracked protocols with over 10,000 different pools. Creating a strategy that uses the best options out of this ocean of possibilities is a tremendous task. Analyzing every single protocol that has the potential to bring you profits seems impossible as it will take you 1,700 hours to check out every single protocol assuming you spend under 10 minutes on each.
Add to the basket of trading options strategies like crypto arbitrage opportunities, automated market making, and DCA/GRID trading, and you have a bottomless pile of ideas, concepts, and approaches that can be included in a portfolio.
We will focus on several key methodologies adopted by many investors in the decentralized finance sector:
While other methods of parking capital in the DeFi sector exist and can be quite profitable, they are often niche and won’t work for an average investor. Nonetheless, you can try complicated schemes like using staked tokens from LIDO or DAI as collateral to take out loans in stablecoins which can be further staked on other platforms. These are multi-stage machinations that can be quite dangerous but also profitable.
All decentralized exchanges and market makers need operational funds to ensure that there is sufficient liquidity for trading. Bridges also use liquidity with some notable players like WBTC or Portal having upward of $12.7 billion and $4.25 billion in TVL respectively.
Investors who provide liquidity to these protocols receive financial incentives in the form of interest payments, cuts of revenue, discounts on certain services, and more. You must understand token economics in DeFi to make informed choices as some pools will be more popular and, thus, more utilized than others.
Here are some examples of liquidity pools from a variety of DEXes:
When it comes to crypto investment diversification, choosing strategies relying on liquidity mining can be a good idea since you can allocate capital to a variety of digital assets and stake them safely on decentralized exchanges. However, returns are dynamic and depend on multiple factors including pool utilization, general demand for staked assets, and others. You have to worry about regular adjustments in multi-sided pools where a constant balance between different types of coins must be preserved at all times.
Lending is the second-biggest category of DeFi protocols by total value locked. With over $48 billion in staked assets across 474 tracked protocols, it is one of the most popular destinations for investors interested in consistent profits.
Since most loans in the DeFi ecosystem must be collateralized and all operations are managed by fully autonomous smart contracts, the risk for an investor is minimized. You should not expect outstanding decentralized finance returns when putting assets into lending pools but the increased safety is quite attractive to many capital holders.
Here are some interesting pools to pick from:
USDT pools on JustLend on Tron are a great choice for many investors interested in consistent crypto passive income. You will enjoy a 3.52% return. Alternatively, staking USDD can be quite profitable despite the low 0.33% base APY as you will be receiving up to 6% in rewards. JustLend is one of the biggest lending protocols out there with a combined TVL of over $5.4 billion.
We won’t be focusing on individual opportunities in this particular sector of the DeFi ecosystem. Hunting for big yields is a great motivator for many proactive retail investors interested in building wealth quickly. Risks here are quite high with many high-performance projects failing to live up to expectations. Decentralized portfolio management can be quite difficult if you include volatile instruments like pools on Pendle or Magpie. These can be incredibly profitable but also very dangerous.
On the other hand, you can use a variety of tools to optimize your investment activities. A good example is Rivo offering a variety of strategies and unique earning opportunities to investors who do not want to spend time and effort learning about thousands of protocols. A plethora of automated yield generation platforms also offer investors assistance in profit optimization.
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