Thread by @dkcrypto13

1/ #Yield generation for $USDC, $USDT, $DAI or other #stablecoins has been pretty much dead after #FTX and the #Mango hack. However, there is still a very nice opportunity to generate high yield in #Defi:

#Acumen, home on #AVAX @avalancheavax. A short 🧵 shows how to get it:

2/ #Acumen generates #yield from real world #microfinance activities. It is based in #ElSalvador and that is also its first market. The team genuinely wants to improve lives of the people who live there and they just launched on #AVAX.

How does microfinance generate the yield?

3/ In #ElSalvador, a lot people and small businesses do not have access to traditional banking. Worse, even if they now get a bank account, they lack a "credit history", so the bank is not willing to lend to them. To build a business and invest, they turn to loan sharks.

4/ These providers of debt charge rates that generally range around 20-30% per month (!) and they are likely to resort to violence if you do not pay them back. Of course, this means a lot of $ float in the "grey economy". Neither the government nor the people like it.

5/ Enter #Acumen - the team has managed to secure a central bank license as a registered lender and has already deployed a test tranche from #Solana to small business owners in #ElSalvador, generating an attractive double digit interest for lenders.

6/ That sounds too good to be true? Well, there are obviously risks, which is why the banks don't know how to price the debt in the first place.

7/ But think about it: if you are offered a loan of, say 10% annually and your alternative is to borrow at 30% monthly (!), having your legs broken if you do not pay it back - what would you do? These borrowers actually have a tendency to be great credit.

8/ They are thankful for the opportunity and they are used to paying back or having their health threatened. Don't believe me? Check out this video they made for a NEAR event with real people from #Acumen's first test tranche:

vimeo.com/751788692

9/ I personally think this is an amazing cause AND of course, I love the high interest. With high interest comes high risk - this is really putting $USDC or $USDT to work in #ElSalvador in a real-world operation, not some lending platform. But it really is using #Defi for good.

10/ Despite the risks, the advantages to what is on offer in #DeFi at the moment are obvious: there is no smart contract risk as the funds get translated into fiat quickly. That also means there is no risk for a de-pegging of $USDC or $USDT. Further, the interest is stable.

11/ Finally, the obvious advantage is: it pays. Getting double digit, STABLE returns on established #stablecoins without smart contract risk, not generated by some "magic internet money" inflationary token is pretty unique. And you're doing a good thing too.

12/ So, if you are aware of all the risks (again: high reward = high risk) and you want to use #Acumen to generate yield, you'll need #stablecoins on #AVAX. If you have them on #ethereum, you'll need to bridge your assets.

13/ The bridge that makes most sense is core.app/bridge

The reason is they not only transfer your funds (be aware on #AVAX c-chain, $USDC is often $USDC.e - same thing, don't worry) but they also give you 0.1 $AVAX, the token to operate on #Avalanche. 2 birds - 1 stone.

14/ Once you bridged your assets (takes about 30mins), and perhaps even before, you'll want to add the network to your #Metamask so you can actually intereact with it. It is explained here:

coindesk.com/learn/how-to-c…

15/ Now you are ready - you have the #Stablecoins on #AVAX and can now use #Acumen. @acumenofficial has a range of options that pay higher APYs if you can lend the money for longer. Even the short-term options might be attractive though as they pay about 2x what #AAVE does.

16/ So now all you have to do is go to acumen.network, choose the right pool for you and deposit.

From this moment you are earning interest and using #Defi to do good.

Follow @acumenofficial and join their #AMA with #AVAX Jan 20th.

https://twitter.com/acumenofficial/status/1614050905359372289?s=20&t=Ha4b-EV73bkknfqtGSGJpw

17/ Again, all #Defi products have risk. High interest almost always implies higher risk too. Only do what you are comfortable with. This is not financial or legal advice.