In the DeFi sector, there are many platforms that allow users to earn returns on their digital assets without going through traditional intermediaries such as banks or brokers.
By 2025, the sector has evolved further, and now DeFi platforms offer increasingly sophisticated opportunities to generate passive income through mechanisms such as lending, staking, liquidity provision and yield farming.
How DeFi generates revenue
DeFi (decentralized finance) is an ecosystem of blockchain-based financial applications that, unlike traditional finance (CeFi), are permissionless. This means that anyone can benefit from this with their own anonymous and non-custodial wallet.
The revenue generated by DeFi protocols comes from various activities, such as lending crypto assets to earn interest, providing liquidity to decentralized exchanges (DEXs), collecting fees, or deploying to support network security in exchange for rewards.
The main mechanisms are:
- loans or crypto loans in exchange for active interest
- staking or participating in transaction validation
- liquidity provision, which means adding one’s own crypto assets to DEX pools to facilitate swaps
- yield farming, which provides liquidity to DeFi protocols in exchange for rewards in the form of interest, fees or governance tokens.
Sometimes these strategies can also be combined with each other, such as liquid staking, which allows you to maintain your liquidity even while committing tokens for staking.
By 2026, average returns will range from 3% to 20% per year for stable assets such as stablecoins, but in some cases they could exceed 100% in risky pools.
However, these rates can be significantly affected by market volatility and the incentives of different protocols, and include risks such as temporary losses, hacks and price fluctuations.
Loans
When it comes to decentralized lending, Aave is the most used platform.
This is one of the most established DeFi protocols, with a TVL of over $4.5 billion and support for no fewer than 9 chains, including Ethereum, of course.
It is a platform that has been around for several years (since 2017) and allows to lend assets such as $ETH, $USDCand DAI, which earn interest. In 2026, it will introduce new features such as flash loans and liquid leverage, ideal for advanced strategies.
To use Aave, you need to connect your wallet (usually MetaMask), deposit assets into a lending pool, and earn dynamic APYs based on demand.
For example by borrowing $USDCone can earn an APY (Annual Percentage Yield) ranging from 3.5% to 6%, while for $ETH it can reach 5-10%.
The risks associated with this are generally related to the fragility of smart contracts, but also specifically to liquidations as collateral decreases.
It is also suitable for beginners thanks to a user-friendly interface and multi-chain support.
Other lending platforms include Compound, for autonomous lending, and Morpho for loan optimization.
Compound is similar to Aave, but with algorithm-based autonomous rates, while Morpho optimizes loans on Aave/Compound with premium vaults.
Liquidity provision
The most used DEX is undoubtedly Uniswap. The recent V3 and V4 versions optimize returns with concentrated liquidity and customized hooks.
To earn returns on Uniswap, you need to provide liquidity to specific trading pairs, such as $ETH/$USDCto collect fees ranging from 0.05% to 1% per swap.
Typical returns range from 5% to 20% for stable pools, but for volatile pools such as $USDC/WBTC about optimism, they can go up to 80.
The most important specific risk, in addition to the generic risks, is related to temporary losses in case of price differences. However, this risk can be significantly reduced by avoiding pools of speculative tokens.
Uniswap features high liquidity and integrations with various wallets, and is also great for yield farming on popular pairs.
To expand
Liquid staking on Ethereum is dominated by Lido Finance, with a TVL of 13.9 billion. It makes putting out $ETH while receiving sETH in exchange for use in DeFi.
In fact, it is possible to yield stETH, for example by borrowing or farming, while continuing to bet $ETH.
Typical yields range between 4% and 8% $ETHbut with a boost for wrapping (wstETH).
The specific risk is significant (loss to offline validators), but rare.
Agriculture yield
Yearn Finance is one of the most widely used yield farming platforms.
Basically, it moves assets between different protocols to maximize APY.
A deposit is made into a vault, which allows the protocol to optimize its use.
Typical returns range between 5% and 15%, but can be as high as 60% in fixed vaults.
However, the risks are greater in this case because they depend on the many underlying protocols.
However, there is also Pendle Finance for yield trading.
Indeed, Pendle allows the tokenization of returns, separating principal (PT) and returns (YT) for fixed or speculative strategies.
In addition, Ethena should also be mentioned as it enables synthetic returns on USDe.
Stable coins
Finally, Curve Finance, a specialist in stablecoins, is also worth mentioning.
Curve is indeed optimized for stable swaps with minimal slippage, making it ideal for yield farming on stablecoins, for example.
Stablecoins are deposited into pools, staked and LP, and rewards are received $CRV.
Typical returns range from 10% to 30% for stable pools, but can exceed 100% with yield-based leverage.
The biggest risk is the dependence on the volatility of the price $CRV sign.
General risks
DeFi is not without risks.
Hacks are relatively common, especially on smaller or less proven protocols, and there are also back pulls, especially on newer ones.
It is advisable to use hardware wallets, and especially to check the audits of the protocols to see if they are secure. In addition, it is always wise to diversify and not leave everything in one or a few protocols. It is also advisable to start with small amounts and pay attention to the costs.