Arguably the best way to earn a passive income from your crypto is with Decentralized Finance (DeFi) solutions. DeFi applications account for the placement of $2 billion worth of crypto assets and this number is growing all the time.
What is DeFi?
DeFi is revolutionizing the way we manage our money through the creation of a new digital banking ecosystem that runs on a smart contract blockchain. It requires no middlemen and is accessible to anyone with an internet connection for the purpose of saving, lending, borrowing, insurance, trading and more. Decentralized apps, or dapps are unlike traditional banking applications in that they are open, and not controlled by any single entity. They use smart contracts, which are automated, without requiring human intervention, and execute automatically when predefined conditions are met.
They are transparent, using open code and making transaction activity public, while maintaining privacy by not being tied to any party’s real life identity. You interact directly with the smart contract from your crypto wallet for an interconnected, fast and flexible digital finance experience. Dapps offer broad functionality, from allowing you to exchange assets, trade, take out a loan, lend out your own money to earn interest, or implement automated investment strategies. They tend to rely on collateral as a safeguard, requiring you to put up your own crypto to enable you to earn you more.
How do yield farmers leverage DeFi for huge returns?
The most common usage of DeFi is for lending and borrowing funds and dapps can be used by yield farmers to earn unmatched profits.
Yield farming refers to the practice of harnessing DeFi products and protocols to generate huge profits. It offers unparalleled returns, far higher than you would receive from a bank or any other traditional investment opportunity, such as stocks, bonds, or real estate. Also, for those who own crypto it is also a far more lucrative option than a straightforward crypto wallet.
Instead of just investing your funds in a cryptocurrency like Ethereum or Bitcoin, you take it one step further, letting a company borrow your capital at an exceptionally high rate. You provide liquidity and in return you earn additional digital currency.
So how does it work?
The way it works is that you convert your assets into different cryptocurrencies, lending it to a company, which might then use your funds for trading or alternatively, may loan your capital to other clients. Those funds will then earn interest, part of which will go into your pocket. Too frequently, crypto holders HODL their coins in their crypto wallet, in the hopes they will appreciate over time when they could be making their money work hard on their behalf every minute of the day. The best part? With the right dapp, you don’t have to spend hours in front of a screen analyzing and responding to crypto market price shifts. In fact you don’t have to lift a finger, as an automated blockchain-based application will do all the work for you.
To understand how you can earn a great passive income on your crypto with DeFi, yield farming, lending or liquidity pool contributions, let’s take ArbiSmart as an example.
The company’s EU licensed platform offers crypto arbitrage trading, which is widely acknowledged to be an exceptionally low risk investment option. Crypto arbitrage is the process of profiting from differences in the price of a coin across exchanges. ArbiSmart earns you money by integrating with over twenty different exchanges and scanning them 24 hours a day to find arbitrage opportunities. It then buys a given cryptocurrency on the exchange with the lowest available price and then sells it where the price is the highest, making a profit on the spread.
The way it works is that you register and deposit funds, which are converted into RBIS, the native token that powers the ArbiSmart platform. Your capital is then used by their fully automated algorithmic trading system for crypto arbitrage investing. While the system goes to work to make you a return on your investment, you can get on with your day and check in with your investment at any time. You have the choice to reinvest your profits to earn compound interest or withdraw your passive earnings in euro, BTC, or ETH whenever you please.
Exposure is minimal, and the yield farming opportunities are incredible, with passive returns reaching an astounding 45% a year! It is important to also note that in line with product advancements and the continued growth of the platform, you can enjoy healthy capital gains from the RBIS token, which has been gaining steadily in value and is projected to hit a substantial increase by the end of 2021.
In addition, at the end of Q3 2020, ArbiSmart will enable you to earn an out-sized passive income from your crypto with our EU licensed and regulated interest-bearing wallet. You aren’t just waiting for your coins to gain in value over time but are earning a whole new revenue stream. The ArbiSmart wallet rewards you for the liquidity your capital provides, with interest starting at 10.8% and reaching 45% a year or even higher.
You can also earn a substantial profit from the steady appreciation of the RBIS coin, which in its first eighteen months rose 119% and is estimated to rise much more than 20 times that amount in the next couple of years alone. You can earn an even higher return, if you place your funds in a locked savings account, with your passive profits depending on the amount you invest and the time frame for the closure.
Yield farming as providing liquidity to arbitrage trading platforms is a great means of ramping up profits. With the emergence of decentralized solutions, there are now countless ways to earn a steady, passive income from your cryptocurrency while you focus on other priorities.
One factor to consider, however, is that the digital economy, while incredibly lucrative can be particularly risky. But, if you do your research, you can find a fully licensed platform that mitigates your exposure while offering generous returns, and this type of investment is more than worth your time.
We would strongly recommend checking Arbismart.com by opening an account.
Disclaimer: This is a paid post and should not be considered as news/advice.