If you want to make money with dapps, you should first know where the money is.
Just as you can’t trade on cryptocurrency exchanges with very low liquidity, you can’t easily make money with dapps that have very low volume or not many users.
Well, which dapps have the most volume? It varies depending on the market, but in general decentralized exchanges and DeFi apps are type of dapps that may have high volume.
But trading or transaction volume is just one of the factors that gives some insight into a dapp. Blockchain games usually have not much volume owing to the nature of such dapps.
But you can make well over a few thousand dollars with blockchain games. Some kitties on the Ethereum-based blockchain game ”CryptoKitties” were sold for over a hundred thousand dollars.
So the space is full of opportunities and there is barely any limit. But this does not mean that it is easy to make money with dapps.
As there are a lot of new dapps going live on various blockchains such as Ethereum, EOS and TRON, you can earn some cryptocurrencies or crypto collectibles by following the dapp space closely and participating in airdrops or special campaigns.
But here we are talking about actually using a dapp, be it a DeFi app, an exchange or a game, with the aim of making money.
First let’s take a look at the most popular decentralized exchanges, DeFi apps and blockchain games.
According to the dapp data of the last 30 days provided by DappRadar and Dapp.com, the decentralized applications below are the top ones by volume and user:
Ethereum-based DEXes: Uniswap, 1inch, Matcha, SushiSwap, Balancer, dYdX, KyberSwap and IDEX.
EOS-based DEXes: Newdex and WhaleEx.
TRON-based DEXes: TronTrade and Poloni DEX.
These decentralized exchanges and platforms may offer traders a great variety of opportunities. For example, you can use 1inch.exchange to get the best rates while swapping tokens.
Or you can use dYdX to trade cryptocurrencies with leverage, borrow and lend cryptocurrencies all in a decentralized manner, no registration or deposit.
But it is not as easy as it sounds. Trading cryptocurrencies with leverage on dYdX is not for everyone.
First of all, there is a minimum trade size in each pair on dYdX. And, considering the complexity of perpetuals trading and limitations of DEXes, it is overall harder to trade on exchanges like dYdX.
Instead, you can trade cryptocurrencies with leverage on centralized cryptocurrency exchanges such as Binance and BitMEX.
So, if your main objective is to make money, trading on centralized exchanges could be be a better choice sometimes.
There are several decentralized exchanges that use an AMM (automated market maker) model in the market such as Uniswap.
You can add liquidity to liquidity pools on Uniswap, SushiSwap and Balancer, and earn trading fees. These decentralized exchanges have their native tokens and allow users to earn tokens by participating in their liquidity mining programs.
For example, those who provide liquidity to Balancer pools also earn Balancer (BAL) tokens. In SushiSwap and a few other exchanges, you can stake your LP (liquidity provider) tokens and earn native tokens.
These dapps have various advantages for users with their liquidity mining programs and other incentives and also by being trustless, transparent, etc.
But it is still up to your skills and experience to take advantage of such platforms and make money on them.
Therefore, if you regularly trade cryptocurrencies to make money or you just want to exchange some tokens, you should check out these high volume Ethereum, EOS and TRON decentralized exchanges and use them together with centralized ones.
You can find different trading opportunities on such DEXes and take advantage of them to make money. As these cryptocurrency exchanges are decentralized, you need a cryptocurrency wallet that you can use to trade on DEXes.
You can use various wallets that are supported by these decentralized exchanges such as MetaMask, Scatter, TronLink and Ledger hardware wallets.
If you have a Ledger Nano X, you can connect it to your MetaMask wallet and use dapps in a much safer way.
For the best decentralized exchanges with fees and supported wallets, check out this list: Decentralized Exchanges
To learn how to trade on and add liquidity to decentralized exchanges that I mentioned above, you can visit the guides below:
There are a lot of blockchain games in the dapp ecosystem. Rather than transaction volume, active users may be a more appropriate metric to take into consideration when checking out blockchain games.
Blockchain game stats vary a lot, but some of the top blockchain games by users are as follows:
Ethereum-based games: Axie Infinity, Sorare, Blockchain Cuties, My Crypto Heroes, CryptoKitties.
EOS-based games: Crypto Dynasty EOS, Upland, Chain Clash, Prospectors and EOS RACING.
TRON-based games: HyperSnakes, ChainZ Arena, Traps, Blockchain Cuties Universe, MegaCryptoPolis and CryptoTree.
Which blockchain game should you play?
A blockchain game with well-designed game mechanics and a high number of active users may be a right choice.
There are a lot of blockchain games in which you can have some collectibles, but you can’t actually play the game.
So, if you don’t want to waste your time, you should be picky about the blockchain game you’ll invest your time and maybe money in.
Axie Infinity, My Crypto Heroes, Sorare and Crypto Dynasty could be given as examples to good, popular blockchain games which you can check out.
As crypto collectibles are not like Bitcoin, those who actually have some passion for the game and spend time playing it instead of just getting some collectibles / in-game items with the intention of selling them at a higher price later are more likely to make more money and enjoy the game.
You can trade crypto collectibles on the games’ own marketplaces or on marketplaces such as OpenSea, which you can use to buy, sell and bid on a lot of crypto collectibles.
For more information about blockchain games and OpenSea, you can check out the articles below:
For the list of blockchain games with supported wallets and other information, check out this page.
DeFi apps (decentralized finance)
Ethereum-based DeFi apps: Compound, Aave, dYdX and Falcrum.
TRON-based DeFi apps: Zethyr Finance and JUST.
You can earn interest on DeFi apps by lending your cryptocurrencies or you can borrow cryptocurrencies by locking up cryptocurrencies as collateral in smart contracts on DeFi apps such as Compound and Aave
You can long or short cryptocurrencies with leverage, become a liquidity provider and get rewards on dYdX.
For more information about DeFi apps, check out the articles below:
Risks of using dapps
Risks such as product failure which can affect most cryptocurrencies apply to dapps as well. The risk of product failure is higher for dapps like blockhain-based games which don’t solely depend on smart contracts.
Developers may stop developing the blockchain game you play or disappear which has been the case for many tokens issued in the ICO frenzy.
Borrowing cryptocurrencies and providing liquidity to the exchange protocols come with some risks as well. You may suffer from impermanent loss due to price fluctuations after providing liquidity to liquidity pools.
When you borrow cryptocurrencies from a platform, there is a risk of liquidation. But both risks can be managed and minimized by users.
The biggest risks are usually related to smart contracts. There might be some flaws in smart contracts that have not been detected by developers and even smart contract auditors.
And hackers might discover such vulnerabilities and utilize them to manipulate the dapp or steal funds from it.
Though there is a company or a group of developers behind a dapp, they usually don’t accept responsibility for losses arising from such incidents.
It does not mean that they will not do anything to get back stolen funds, but with decentralized applications, once your cryptocurrencies are lost to hackers, there is a very little chance that you can get back your funds.
As you need to use your own cryptocurrency wallet each time you want to interact with dapps, there is also a risk of getting your wallet hacked if your computer or the dapp you use is compromised.
Therefore, using hardware wallets such as Ledger Nano X to access and use dapps is a safer option as private keys are never exposed. You can also connect your Ledger device to MetaMask and use almost all Ethereum dapps in the market.
To use Ethereum, EOS and TRON dapps, you need cryptocurrency wallets that allow users to interact with dapps.
Check out the articles below for the best cryptocurrency wallets that you can use to access dapps.
If you are a good trader, a passionate gamer or just a person interested in dapps, you should definitely check out these decentralized applications and keep an eye on the dapp space.
In the long term, you can be overall better off just by being an early adopter / user of dapps and depending on your skills and luck, you can make a significant amount of money with dapps.