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Interestingly, even today you can still get much better than 7% in DeFi. No need to give your money to a curly haired dude living in a condo on an island. Who,

Interestingly, even today you can still get much better than 7% in DeFi. No need to give your money to a curly haired dude living in a condo on an island. Who, at the time, was making a lot more than that on your funds. In DeFi, you give your money to a "smart" contract, which can of course still get hacked or what not. Always assess your risk/reward ratio. Where does the yield come from? Collateralized lending/borrowing markets. People are still gambling with crypto and they can do it better, if they can borrow funds. It got a lot smaller after the collapse of FTX, but hasn't stopped at all. Aave still has $7.5b locked up.

tornato7 4y ago
Aave rates are sub-3%
- latchkey 4y ago
  Aave isn't the only site out there. That was just an example.
  - somsak2 4y ago
    feels weird to provide an example that is less than half of the rates we were talking about, any others?
    - latchkey 4y ago
      DeFi is a fascinating (to me) set of money lego's to effectively become your own bank. Like writing code, it takes a bit of time and effort to really dig in and understand the mechanics of providing liquidity. There is a lot of risk and a lot of reward. It is a bit of a minefield, but you do it long enough, you learn ways to navigate safely. If you have any experience in currency conversion, this is the equivalent to that. If you've travelled you've probably bought and sold currency at the airports. If you're in Saigon, you get the best USD->VND rates not at the airport, but by going to the gold dealers who have shops on the streets. You have to shop around to different stores to find the best rates. DeFi enables you to effectively be that conversion service (gold dealer). But instead of USD->VND, it is ETH->BTC (or whatever cryptos you want to provide liquidity for, or lend/borrow). I personally find this a fascinating aspect of crypto that few understand or even care to look into. It goes far beyond just the gambling aspect of buy/hold and number go up (or down). It turns into real finance and an actual valid use case for crypto. Sure, crypto is re-inventing the same old stuff that people have been doing for ages, but at least now people globally have the ability to try out these mechanics, instead of just leaving it up to the bankers (or gold dealers) to get rich on your money. I love the concept of power to the people. That said, I'm not here to give financial advice about how to get the best rates. There is nothing weird about that. I'm just saying they are out there if you want to look for them and learn more about it all. Aave is just an example of the fact that a single site has a $7.5b market. Of course, if there is a market that large, there is going to be many other sites than that, and it is all quite competitive. If you're interested in this, please do your own research.
      - somsak2 4y ago
        to claim "you can get much better than 7%" and then refuse to provide a single example is a fascinating approach to the conversation

tornato7 4y ago

Aave rates are sub-3%

latchkey 4y ago
Aave isn't the only site out there. That was just an example.
- somsak2 4y ago
  feels weird to provide an example that is less than half of the rates we were talking about, any others?
  - latchkey 4y ago
    DeFi is a fascinating (to me) set of money lego's to effectively become your own bank. Like writing code, it takes a bit of time and effort to really dig in and understand the mechanics of providing liquidity. There is a lot of risk and a lot of reward. It is a bit of a minefield, but you do it long enough, you learn ways to navigate safely. If you have any experience in currency conversion, this is the equivalent to that. If you've travelled you've probably bought and sold currency at the airports. If you're in Saigon, you get the best USD->VND rates not at the airport, but by going to the gold dealers who have shops on the streets. You have to shop around to different stores to find the best rates. DeFi enables you to effectively be that conversion service (gold dealer). But instead of USD->VND, it is ETH->BTC (or whatever cryptos you want to provide liquidity for, or lend/borrow). I personally find this a fascinating aspect of crypto that few understand or even care to look into. It goes far beyond just the gambling aspect of buy/hold and number go up (or down). It turns into real finance and an actual valid use case for crypto. Sure, crypto is re-inventing the same old stuff that people have been doing for ages, but at least now people globally have the ability to try out these mechanics, instead of just leaving it up to the bankers (or gold dealers) to get rich on your money. I love the concept of power to the people. That said, I'm not here to give financial advice about how to get the best rates. There is nothing weird about that. I'm just saying they are out there if you want to look for them and learn more about it all. Aave is just an example of the fact that a single site has a $7.5b market. Of course, if there is a market that large, there is going to be many other sites than that, and it is all quite competitive. If you're interested in this, please do your own research.
    - somsak2 4y ago
      to claim "you can get much better than 7%" and then refuse to provide a single example is a fascinating approach to the conversation