Best CeFi vs DeFi Yields in 2025
CeFi (Centralized Finance) and DeFi (Decentralized Finance) both offer ways to earn passive income from crypto assets - but with very different approaches to custody, transparency, and risk. Here's a deep comparison for 2025.
At a Glance
| Platform | Type | Top APY | Custody | Supported Assets | Risks |
|---|---|---|---|---|---|
| Nexo | CeFi | Up to 12% | Custodial | BTC, ETH, USDT, more | Counterparty, platform risk |
| Binance Earn | CeFi | Up to 10% | Custodial | Wide range | Exchange risk |
| Aave | DeFi | 4–8% | Non-custodial | Stablecoins, ETH, more | Smart contract risk |
| Lido | DeFi | 3.5–5% | Non-custodial | ETH, SOL, others | Validator risk |
Key Differences
- Custody: CeFi platforms hold your assets; DeFi lets you keep control via your wallet.
- Returns: CeFi often advertises higher APY but may come with more opaque risk.
- Access: DeFi is open globally - no KYC. CeFi may restrict based on region.
- Risks: CeFi - platform solvency. DeFi - smart contract vulnerabilities.
Safety Considerations
Always weigh the trade-off between yield and security. High returns often mean higher risk. Consider using a hardware wallet with DeFi platforms and avoid storing large amounts in centralized accounts unless fully trusted.
Our Verdict
If you're new to crypto or prefer simplicity, CeFi platforms like Nexo may be a smoother start. For experienced users who value transparency and control, DeFi protocols such as Aave and Lido offer solid yields with full self-custody.
Related
FAQ - CeFi vs DeFi Yields
- Is CeFi safer than DeFi?
- CeFi platforms are more user-friendly but introduce custodial risks - your funds are held by a company. DeFi gives you full control but requires managing private keys and interacting with smart contracts, which can have vulnerabilities.
- Which offers higher yield: CeFi or DeFi?
- DeFi generally offers higher APYs, especially for volatile assets or LP tokens. However, these yields come with higher risk and complexity. CeFi tends to offer lower, more predictable returns with easier onboarding.
- Can I use both CeFi and DeFi?
- Absolutely. Many investors diversify by using CeFi for stable income and DeFi for higher-risk strategies. Just ensure you understand the risks and do proper due diligence.
- What happens if a DeFi protocol is hacked?
- If a smart contract is exploited, funds may be permanently lost. Unlike CeFi, there’s no customer support or insurance unless explicitly provided (e.g. Nexus Mutual). Always use audited protocols.
- Are CeFi platforms regulated?
- Some CeFi platforms (like Nexo or Coinbase Earn) are regulated in certain jurisdictions. However, crypto regulation is evolving, and coverage varies by country. Always check the legal status in your region.