The Best Investments for 2025: Expert Review of Promising Protocols

An anecdote told by a Reddit user about a solid USDe investment on Pendle for a juicy 38% APY did not gain much traction among commenters but it is a great example of someone making a risky investment that paid off dearly. Yield farming can be quite dangerous for crypto enthusiasts who do not have much experience with decentralized apps and how they work. Choosing where to allocate your capital can be a challenge in 2025.

Promising DeFi investment opportunities

The variety and complexity of options offered by the decentralized finance industry seem astonishing to newcomers. However, veterans know to avoid many projects that look too good to be true because, in the vast majority of cases, they are. Even large centralized organizations fail with DeFi products like in the case of BNB staking in the Binance Vault that failed dramatically for thousands of hopeful investors.

Separating the wheat from the chaff is a tough task for most first-time investors since you need to spend a lot of time and effort learning about different protocols, their products, and the DeFi ecosystem in general.

In 2025, you should keep an eye out for several categories of protocols:

  • DEXes and automated market makers that offer liquidity pools without rewards can be a safe bet as the cash influx that occurred at the end of 2024 when the combined TVL of the ecosystem ballooned to over $120 billion ensures that assets will be in high demand.
  • Lending is still among the safest options for DeFi investors interested in consistent profits. All loans in the DeFi sectors must be fully collateralized making it safe for capital holders to stake on platforms like Aave, JustLend, and Compound.
  • Yield protocols that give you rewards for liquidity provision can be great too if you can time your exit appropriately and cash out when reward tokens still hold value. Some of the most promising crypto investments happen on protocols like Pendle or Aerodrome.
  • Liquid staking is a good choice for active investors with a strong desire to get into the action personally. By moving assets around and keeping holdings liquid, you can achieve incredible profits at the cost of higher risks. Liquid staking is the biggest category of DeFi protocols by the combined TVL with over $59 billion locked on Lido and similar platforms.

A typical investor will struggle to identify good choices even when the selection of instruments is narrowed down to just these four categories which, in total, are represented by 2765 tracked protocols (52% of all platforms) and have a massive combined TVL of $144 billion.

Profitable decentralized finance strategies in 2025

The DeFi sector has many other intriguing options to explore. For instance, the RWA (real-world assets) category has reached a solid $8 billion TVL indicating a strong interest in the tokenization of various commodities and real estate. Bridges, liquid restaking, CDP, and other categories of protocols are also quite popular among investors.

However, some of the best and most reliable protocols are in the categories that we listed above. Many investors find success by working with platforms offering ready-to-go strategies. For instance, you may abstain from choosing the right protocol completely and simply trust the team of experts at Rivo that offers a rich selection of promising strategies. Investing in the CVX-ETH liquidity pool through Convex using Rivo can be quite profitable with a solid 34.2% dynamic APY and moderate risk.

The yield farming potential

You can receive rewards for staking digital assets on many types of platforms. DEXes, AMMs, and other protocols give you different types of native tokens to incentivize participation.

This particular approach has several advantages:

  • Investors are rewarded for capital allocation at a much higher interest rate.
  • All holders of tokens can vote to make governance token analysis very valuable.
  • Yield farming can be done with many popular tokens including layer 1 coins and stablecoins.

Over 550 different protocols focused on yield farming are tracked by aggregators. Their combined TVL was close to $9.5 billion in January 2025.

Liquidity pool mechanisms

LPs are incredibly popular among many experienced professionals who can identify which digital assets will be in strong demand in the near future. Dynamic APYs depend on a variety of factors like trading volumes, price action, and utilization of assets in pools. In essence, a pool that generates revenue consistently will have a high rate of return.

Liquidity is in high demand on DEXes and automated market makers. These protocols have over $25 billion in combined TVL and can be very profitable.

Top blockchain protocols

Exploring the diverse and incredibly complex world of DeFi can be difficult even if you have some experience with cryptocurrencies. We want to give you several examples of excellent protocols with good track records, strong reputations, and intriguing investment instruments. Note that we do not endorse any of the options below directly and encourage all our readers to do their own research before investing.

  • Lido is a great destination for enthusiastic investors. Lido is a liquid staking platform where you can stake ETH for 3.47% base APY in a pool with a TVL of over $31 billion. The resulting STETH can be further used on protocols like Aave to take out a loan in ETH for restaking or stablecoins for yield farming on various platforms across the DeFi ecosystem.
  • Aave is still the safest choice for investors with a more conservative approach to capital allocation. This protocol is based on cross-chain interoperability as it operates across 13 chains and allows investors to choose from a wide range of pools. For instance, you can stake USDT here for 7.08% base APY or focus on staking WETH for an additional 1.81% APY.
  • Pendle has 114 pools with limited maturation and high APY rates. The average return here is 15.66% in January 2025. You may focus on SUSDe pools that have APYs ranging from 17% to 22.3%. The combined TVL of the protocol is over $5.1 billion which is a respectable number however you look at it. The Pendle token has a solid $600 million market cap.
  • Uniswap is the biggest decentralized exchange in the whole sector with a massive $5.47 billion TVL as of the time of writing and over 5147 pools averaging 45.4% APY. You can invest in a wide range of different pools like WBTC-WETH 0.3% at 7.28% base APY. 

The consequence of blockchain technology innovations is the growth of the DeFi sector and the increasing participation of institutional investors and whales in the expanding decentralized economy where protocols like Uniswap and Pendle allow users to earn sky-high APYs just by allocating capital smartly. 

All of the protocols mentioned above are solid choices for any investor. However, we must also mention some other options like Pancakeswap and Curve DEX for decentralized exchanges, Compound and Justlend for lending protocols, and Aura among yield platforms. Note that many projects, such as Curve DAO, are fruits of community-driven development and have earned the trust and support of thousands of active cryptocurrency enthusiasts.

We strongly recommend researching potential targets for investments and making decisions only after lengthy considerations.