Decentralized Finance (DeFi) is a financial system that is not controlled by a single centralized authority but spread to various players. Third-party involvement is not necessary in this peer-to-peer financial system that uses blockchain technology to secure transactions. Unlike the traditional centralized financial system, decentralized finance services like loans and payments are not controlled by a single authority, and hence, interest rates are also not determined by any authority.
Interest rates on DeFi loans and deposits are volatile and depend on supply and demand. Predicting DeFi’s interest rates is crucial to determining whether to invest or borrow funds. It influences the appeal of decentralized finance. The interests are determined automatically by an algorithm coded into the smart contracts. DeFi interest rates are usually higher than those of traditional savings accounts.
DeFi lending is growing at a very fast pace as new platforms and technological advancements are arising at all times. DeFi sales are expected to reach $37.04 billion by 2028 from $26.17 billion in 2024.
DeFi interest rates in 2024
The highest interest rate recorded till now in the year 2024 is 693.80% provided by Coinbase which supports all cryptocurrencies. ByBut provides up to 559.62% interest rate on more than fifty types of cryptocurrencies including Bitcoin and Ethereum. The rates may vary at any time based on the market conditions. The following table lists the top providers that pay the highest annual percentage yield in 2024.
| Provider | Highest Interest Rate | Supported Cryptocurrencies |
| Coinbase | Up to 693.80% | 119 cryptocurrencies, including Ethereum, Cardano, Solana, Cosmos, and more |
| ByBit | Up to 559.62% | 50+ cryptocurrencies, including Bitcoin, Ethereum, Dogecoin, and more |
| Binance | Up to 141.54% | 340+ cryptocurrencies, including Bitcoin, Ethereum, Litecoin, Dogecoin, stablecoins, and more |
| MyContainer | Up to 105.1% | 25+ cryptocurrencies, including Polygon, Avalanche, Decimal, Harmony, and more |
| OKX | Up to 49.87% | 100+ cryptocurrencies, including Apecoin, Ethereum, LookRare, Sushibar, Compound, USDT, USDC, and more |
| Nexo | Up to 35% | 35 cryptocurrencies, including Bitcoin, BNB, Chainlink, Ethereum, and more |
| YouHolder | Up to 13% | 30 cryptocurrencies, including Litecoin, Ethereum, Bitcoin, and more |
| Crypto.com | Up to 12.5% | 21+ cryptocurrencies, including Bitcoin, Ethereum, Algorand, Cardano, Dai, stablecoins, and more |
| AQRU | Up to 10% | USDC, Bitcoin, Ethereum |
| Ledn | Up to 9.5% | Bitcoin and USDC |
DeFi Interest Rates in 2025
DeFi interest rates are determined based on the demand for lending and borrowing. The value and risks associated with each cryptocurrency also lead to the volatility of interest rates. Competitions between different platforms and changing protocols also cause variations in interest rates. Aave and Compound are some of the platforms that offer real-time interest rates for various cryptocurrencies like Ethereum and stablecoins.
The following is a table that shows some of the best crypto lending platforms of this month. This table is an insight into the coming year. These platforms should be trusted for secured transactions giving the best interest rates in the market.
| Platform | LVT Ratios | Interest Rates | Supported Assets |
| Binance Loans | Up to 65-80% | Competitive, calculated minute-by-minute | 30+ cryptocurrencies, including BTC, ETH, and stablecoins |
| Aave | Up to 80% | Dynamic, based on supply and demand (ETH < 3% APR, USDC > 16% APR) | ETH, stablecoins, assets on Polygon, Avalanche, Arbitrum |
| Compound | Up to 80% | Algorithm-driven, stablecoins < 4% APR | ERC-20 tokens, mainly stablecoins |
| CoinRabbit | Up to 90% | 12% – 17% APR (calculated monthly) | 70+ cryptocurrencies, including BTC, ETH, and stablecoins |
| Unchained Capital | Up to 70% | Above 14% APR (varies by loan terms and collateral) | Bitcoin |
| Alchemix | Up to 50% | Self-repaying via collateral yield | DAI, ETH, USDC, USDT |
| Crypto.com | Up to 80% | Reduced to 8% APR for CRO stakers, higher without CRO staking | 13 cryptocurrencies (BTC, ETH, CRO, USDT) |
| Wirex | Up to 80% | Starts at 8% APR (varies by collateral and amount) | BTC, ETH (limited selection) |
| YouHolder | Up to 97% | 12%-26.07% APR (depending on LTV and asset type) | 50+ assets, including BTC, ETH, and stablecoins |
The interest rates for different cryptocurrencies can differ based on market trends, lending and borrowing rates, inflation, and the supply and demand of the crypto market. As per the current trends in the DeFi market, it is estimated that the 2025 DeFi market will be led by providers like Aave, Compound, and Binance Loans. Binance Loans provide a loan-to-value ratio of up to 80% on select assets and have competitive interest rates that are calculated minute-by-minute to ensure real-time accuracy. Aave also provides up to 80% loan-to-value ratio, which is calculated by the supply and demand of the currencies.
Here is a prediction table that shows the annual percentage yields of some of the best cryptocurrencies in 2025.
| Cryptocurrencies | Annual Percentage Yield in 2025 |
| Bitcoin (BTC) | 4-6% |
| Ethereum (ETH) | 5-8% |
| Tether (USDT) | 6-8% |
| USD Coin (USDC) | 6-8% |
| Binance Coin (BNB) | 6-10% |
| Cardano (ADA) | 5-7% |
| Solana (SOL) | 6-10% |
| Polygon (MATIC) | 6-8% |
| Avalanche (AVAX) | 6-10% |
| Polkadot (DOT) | 5-7% |
The predictions are based on the current trend of the DeFi crypto market and the interest rates are highly volatile and can change over time. Investing in DeFi platforms can be a form of passive income and the predictions are crucial to determine where to lend or borrow crypto.