Top 6 Platforms Providing the Best DeFi Lending Rates

Getting a good DeFi yield is not as hard as it seems. It is an excellent way to generate passive income, used by hundreds of thousands of investors to boost their portfolios. What’s more, there are many platforms that offer excellent DeFi rates, so there’s certainly no dearth of options.

We list the top six DeFi platforms with the best lending rates, plus analyze what DeFi lending is and how it works.

What is DeFi lending?

DeFi stands for decentralized finance, and it represents an ecosystem that uses blockchain technology to create financial applications. While there are many similarities to the traditional financial system, DeFi applications operate without a central authority to oversee their operations. The blockchain that supports them provides the security and privacy of users.

A DeFi lending protocol allows users to lend and borrow cryptocurrency assets. Whereas traditional systems are platforms that lend money to borrowers, a DeFi lending application allows peer-to-peer (P2P) lending among network participants and eliminates the need for third-party involvement.

By using a DeFi lending platform, lenders can earn a DeFi yield. It is a passive income for crypto holders who want to lend their crypto assets to the platform. The platform also offers long-term investors the chance to earn high-interest DeFi rates. DeFi lending protocols are beneficial for both lenders and borrowers.

You might be wondering why a DeFi lending platform is better than traditional financial platforms. And the answer is that DeFi lending protocols offer a significant advantage — anyone can become a lender and earn interest. Users can also borrow crypto by simply connecting their crypto wallets to the platform.

DeFi lending features

DeFi offers the exact same products and sometimes even more than traditional brick-and-mortar financial institutions. The top financial services offered are lending, borrowing, trading, and investing. On top of these, DeFi protocols use blockchain to provide additional benefits.

Some general characteristics of these lending protocols are:

• Anonymous and decentralized
• Can help users generate a passive income, by lending their crypto assets out to others
• Lending pools are the most popular way to generate interest in crypto-assets.
• To protect against sudden drops in collateral value, borrowers are often required to over-collateralize loans. This condition makes it safer for lenders.

Advantages and disadvantages

To get the best DeFi yield out of any protocol, users must understand how DeFi lending works and who is most suitable to use these platforms to generate a passive income. Let’s consider the advantages and disadvantages of using these innovative financial tools.

Advantages of DeFi protocols

• Improved speed for loan approval: DeFi loans present a huge advantage over traditional loans, with processing being much faster. There is no need to wait for months to get verified, no papers needed, and no need to go physically to a bank. Blockchain makes everything easy for everyone involved. In short, anyone can take a loan, if they meet the conditions of the DeFi protocol. 
• Better consistency in decisions: All loans and interest rates have consistency when it comes to design, and all the conditions are publicly outlined. 
• Permissionless: All DeFi applications are permissionless, which means that anyone can use the protocols and makes the entire process much easier compared to the traditional lending and borrowing process. 
• Programmability: All DeFi platforms are based on blockchains that support smart contracts, which eliminate the need for central authorities as well as potential human errors. 
• Self-custody: DeFi loans enable users to have complete control over their digital assets. Simple tools such as crypto wallets offer complete ownership, security, and control over assets. 
• Immutability: DeFi protocols have the property of immutability. Users can rest assured that nobody can tamper with the data on the blockchain, and they can audit the smart contracts and their execution to make sure everything is secured. 
• Interoperability: Most DeFi protocols now support multiple blockchains, constantly adding new ones. This makes them much easier to use and opens a world of possibilities to their lenders and borrowers 

Disadvantages of DeFi protocols

• Limited integration: While some DeFi protocols support multiple blockchains, others limit support to a few networks. It’s unlikely that a crypto user will be able to interact with only one network and will need to use different protocols to access their services. For most users, it’s hard to start using DeFi lending platforms without going through a centralized exchange first, such as Binance or Coinbase. 
• Poor user experience: Please take into account that the DeFi space is still in its infancy. These new platforms may also present some malfunctions, and users need to be extra careful when approving transactions from their wallets. 
• No governmental oversight: DeFi platforms do not fall under any regulatory framework, and funds deposited in these protocols do not benefit from the insurance mechanisms offered to traditional banks and financial institutions. Users have to trust the creators of the platforms that there are no bugs hiding in the code of the smart contracts that could lead to a loss of funds. 
• High volatility: Cryptocurrencies are not backed by governments, which leads to much higher price volatility for digital assets. Lending and borrowing conditions can change in an attempt to counteract the swift price changes.

What are the top platforms with the best DeFi lending rates?

1. Figure Markets

From trading to stabilizing and earning yield/APY, Figure Markets offers both a trusted exchange and a cutting-edge democratized prime lending marketplace with highly competitive rates. 

Users looking for crypto-backed loans, in particular, benefit from some of the lowest fixed-rate 50% LTV in the industry.

As of 2025, these come in at:

• 8.91% (9.999% APR)  at 50% LTV or below
• 11.50% (12.62% APR)  up to 75% LTV

Users benefit from same-day approval, with no hard credit score needed and flexible payment options available. Whether you are looking to consolidate debt, fund a large purchase, upgrade your home, or bridge short-term finances, Figure’s crypto-backed loan platform (Figure Loans), offers both Bitcoin loans and Ethereum loans and lets you borrow against your holdings instantly.

Essentially, you get to access cash without selling your existing crypto holdings, which stay safe and sound in a segregated MPC Wallet. There’s no rehypothecation with Figure (i.e., the platform doesn’t use your collateralized assets for its own purposes).

The platform has already paid out an impressive amount, having helped originate around $16 billion in real-world loans, mostly home equity lines of credit, on Provenance Blockchain.

Also notable is Figure Markets’ Democratized Prime product, allowing users to earn up to 9% APY, that has traditionally only been available to TradFi banks/institutions. 
If you’re a long-term HODLler, don’t miss out on earning 9% yield from revenue-generating assets with Figure Market’s Democratized Prime. If BTC is more your style, check out their Crypto Backed Loans, which are currently offering industry-low rates at 8.91% to keep accumulating more Bitcoin.