DeFi on Starknet: The Master Guide For Beginners

What Makes DeFi on Starknet So Special?

DeFi on Starknet stands out due to a unique mix of benefits that are hard to find elsewhere. Here are the top four reasons why Decentralized Finance on Starknet is special:

1. High Yields: DeFi protocols on Starknet offer some of the highest returns in the Ethereum ecosystem. For example, the STRK/ETH liquidity pool on mySwap offers an impressive 397.61% APR at the time of writing.

2. Extra STRK Rewards: Thanks to the Starknet Foundation’s DeFi Spring Incentive Program, you can earn additional STRK rewards. This program began on February 22, 2024, and will run until the end of 2024.

3. Speed and Low Costs: Starknet is a zk-Rollup on Ethereum (Layer 2), known for its scalability, speed, and low transaction fees. With Ethereum’s EIP-4844 upgrade, simple transactions like token transfers cost less than $0.001.

4. Enhanced Security and Usability: Starknet features native Account Abstraction, making DeFi safer and easier to use. With wallets like Braavos, users can enjoy advanced features like biometric 2FA, 3FA, multi-sig, and one-click DeFi transactions.

The 3 Pillars of DeFi On Starknet:

DeFi on Starknet consists of three key components: decentralized exchanges (DEXs), money-market protocols (for lending and borrowing), and perpetual & options protocols.

1. Decentralized Exchanges (DEXs)

Why use DEXs on Starknet?

Starknet’s DEXs offer all the key benefits: high yields, STRK rewards, fast and low-cost transactions, enhanced security, and ease of use. These DEXs are simple to navigate, and thanks to native account abstraction, you can combine token approvals and swaps into a single transaction. This means lower gas fees and fewer steps to complete your trades.

Efficient Liquidity: The top two DEXs on Starknet, mySwap and Ekubo, use concentrated liquidity. This allows you to earn more APR with the same amount of liquidity, making your capital more efficient. However, it may require some technical know-how and occasional rebalancing to maintain your earnings.

How to use mySwap CL to swap tokens:

Step 1
Connect to mySwap.xyz and select the tokens you want to swap

Step 2
Type in the amount of tokens you want to swap and click on ‘Swap’

Step 3
Sign the transaction in your Braavos wallet

How to use mySwap CL to become a liquidity provider:

Step 1
Connect to mySwap.xyz and add a position

Step 2
Select the token pair and pool fee

Step 3
Add the liquidity and click on ‘Add’

Step 4
Sign the transaction in your Braavos wallet

How to earn STRK thanks to Starknet DEXs during the DeFi Spring:

Step 1
Connect to mySwap.xyz and add a position on one of the 7 participating pools

Step 2
Select the token pair and pool fee

Step 3
Add the liquidity and click on ‘Add’

Step 4
Sign the transaction in your Braavos wallet

Now let’s understand how money-market protocols work!

2- Lendings & Borrowing Protocols (Money Markets)

Why use Money Markets on Starknet?

Money markets on Starknet share the same benefits as DEXs: high yields, STRK rewards, fast and low-cost transactions, and secure, easy-to-use interfaces. Native account abstraction allows you to approve token spending and lend them in a single transaction, cutting down gas fees and reducing the number of steps involved.

How to provide liquidity to Nostra:

Step 1
Go to https://app.nostra.finance/ Nostra Finance and select a market

Step 2
Deposit liquidity (read carefully what it means to enable both lending and collateral)

Step 3
Sign the transaction in your Braavos wallet

How to provide liquidity to zkLend:

Step 1
Go to https://app.zklend.com/markets and select a market to supply liquidity to

Step 2
Type in the amount you want to supply and click on ‘supply’

Step 3
Sign the transaction in your Braavos wallet

How to earn STRK thanks to Starknet Money-Market protocols during the DeFi Spring:

Step 1
Go to https://app.nostra.finance/ and select one of the 4 participating markets

Step 2
Deposit liquidity (read carefully what it means to enable both lending and collateral)

Step 3
Sign the transaction in your Braavos wallet

3- Perps & Options Protocols (Perpetuals)

Why use Perps & Options Protocols on Starknet?

Like DEXs and money markets, Perps and Options protocols on Starknet offer high yields, STRK rewards, and fast, affordable transactions. With native account abstraction, these protocols allow you to approve and trade in a single step, saving on gas fees and time.

How to trade on Carmine:

Note: this is for advanced users. Use at your own risk.

Step 1
Select a market you want to trade, select if you want to go long, short and if you want to call or put

Step 2
Click on ‘Buy’ to start the trade

Step 3
Sign the transaction in your Braavos wallet

How to earn STRK thanks to Starknet Perps & Options Protocols during the DeFi Spring:

This section will be updated once the DeFi Spring for Money-Market protocols starts.

Best Wallet for DeFi on Starknet: Braavos

Braavos is the top wallet for DeFi on Starknet. Here’s why:

• One-Click DeFi: Stake your ETH and earn yields with a single click.
• Advanced Security: Protect yourself from phishing, malware, and even physical threats with Braavos’ 3FA security.
• All-in-One dApp Access: Access all DeFi dApps in the Braavos dApp Gallery.
• Transaction Tracker: Easily manage and track your transaction history.

Download Braavos today and experience the best of DeFi on Starknet.