1800% APR! 900% APR!
DeFi can produce crazy returns but how does the average Joe make the most of it when understanding basic cryptocurrencies is hard enough?
Follow this thread below to learn more!
DeFi can produce crazy returns but how does the average Joe make the most of it when understanding basic cryptocurrencies is hard enough?
Follow this thread below to learn more!
First of all, what is DeFi?
DeFi dApps live entirely on the blockchain. They are owned not by central entities but by token holders, and revenue from them also accrues to the token.
When you access a DeFi dApp you do so directly with a blockchain wallet.
DeFi dApps live entirely on the blockchain. They are owned not by central entities but by token holders, and revenue from them also accrues to the token.
When you access a DeFi dApp you do so directly with a blockchain wallet.
Why is DeFi cool?
DeFi is cool because it allows anyone, anywhere in the world to access financial services just by logging in with their wallet. No account signup, no KYC, no email required.
Also, by using DeFi dApps, you can also earn tokens, making YOU part owner!
DeFi is cool because it allows anyone, anywhere in the world to access financial services just by logging in with their wallet. No account signup, no KYC, no email required.
Also, by using DeFi dApps, you can also earn tokens, making YOU part owner!
What types of DeFi are there?
There are a few main types of DeFi products, but the most common ones are: DEXs (Decentralized Exchanges), Money Markets (Borrowing and Lending), Derivatives, and Vaults or Yield Farms.
There are a few main types of DeFi products, but the most common ones are: DEXs (Decentralized Exchanges), Money Markets (Borrowing and Lending), Derivatives, and Vaults or Yield Farms.
DEXs (Decentralized Exchanges):
DEXes allow you to swap your tokens for other tokens instantly, directly from your wallet.
They also allow you to earn by providing liquidity.
Popular ones include: PancakeSwap, 1inch, QuickSwap, Raydium, and @loop_finance (coming soon).
DEXes allow you to swap your tokens for other tokens instantly, directly from your wallet.
They also allow you to earn by providing liquidity.
Popular ones include: PancakeSwap, 1inch, QuickSwap, Raydium, and @loop_finance (coming soon).
Money Markets:
Money Markets allow you to use your crypto assets as collateral and borrow.
Don’t want to sell your crypto but need money?
Or would you like to leverage your position by borrowing against your crypto and buying more?
Money markets allow you to do this.
Money Markets allow you to use your crypto assets as collateral and borrow.
Don’t want to sell your crypto but need money?
Or would you like to leverage your position by borrowing against your crypto and buying more?
Money markets allow you to do this.
Derivatives:
Derivatives take many forms but the most basic is simply a tokenized version of traditional stocks.
If you want to trade Apple or Google stocks but do it in a decentralized way, then platforms such as @mirror_protocol are for you!
Derivatives take many forms but the most basic is simply a tokenized version of traditional stocks.
If you want to trade Apple or Google stocks but do it in a decentralized way, then platforms such as @mirror_protocol are for you!
How to Earn Money with DeFi?
The most basic way to earn money with DeFi is through a product like @anchor_protocol on the Terra blockchain.
With Anchor you can deposit UST and earn close to 20% interest per year!
The most basic way to earn money with DeFi is through a product like @anchor_protocol on the Terra blockchain.
With Anchor you can deposit UST and earn close to 20% interest per year!
Becoming a Liquidity Provider:
Providing liquidity means to deposit your crypto assets into a “pool” on a DEX.
For example, if you deposit UST and LUNA into the upcoming @loop_finance DEX then you will earn trading fees every time someone makes a swap between LUNA and UST.
Providing liquidity means to deposit your crypto assets into a “pool” on a DEX.
For example, if you deposit UST and LUNA into the upcoming @loop_finance DEX then you will earn trading fees every time someone makes a swap between LUNA and UST.
Yield Farming:
After you’ve provided liquidity to a pool on a DEX, you will be given LP tokens in return which represent your share in the pool.
To earn even more, you can stake those LP tokens into a farming contract on the same DEX and earn extra tokens.
After you’ve provided liquidity to a pool on a DEX, you will be given LP tokens in return which represent your share in the pool.
To earn even more, you can stake those LP tokens into a farming contract on the same DEX and earn extra tokens.
For more complex ways to earn yield from DeFi, you can look into strategies such as vaults or other yield farms.
There are many, many options out there, but be careful as the higher the APR, the higher the risk!
Happy DeFi-ing everyone!
There are many, many options out there, but be careful as the higher the APR, the higher the risk!
Happy DeFi-ing everyone!
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