Become The Next Big Thing With DEFI In Five Ways

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3 min read


Want to earn more? Have you tried out DEFI passive income ways? Do you wish to earn passively with DEFI? You don't know what DEFI is? Do you wish to know so you could earn passively with it? Do you know there are many ways to earn passively with DEFI?

This content is for all that and by the end of your reading, you'd either realize that you've been earning passively with DEFI or missing out before now. In any case, have a good read and stay informed.

*What Is DEFI?

Any financial application built on cryptocurrencies or any blockchain technology made to get rid of the need for financial middlemen is DEFI, a short for Decentralized Finance.

Before now (Web 3), we were made to work with intermediaries in saving our money for little or no interest paid to us even though our money is being used for other activities like borrowing to earn themselves more money. Alternative to bank is decentralised finance, it is less bureaucratic, more transparent in its dealings, safer, cheaper to operate and everyone could access it.

Even as there are no financial situations without risk, earning passive income with DEFI can be a good compromise and there are many ways to do so but I'll share a few ways you could earn passively from it.

Five different ways to earn passively with DEFI

Earning passively means you don't have to stress much to get paid, it's mainly about investing your money and not time and I'll say it is the most coolest way to earn money nowadays thanks to the evolving world.

You can earn through DEFI-Lending

Just like with then banks where we deposit our money with the option of getting paid interest for a period of time, DEFI-lending is even much better. DEFI-lenders lock their assets in lending platforms and are paid from the interests paid by borrowers who utilize the locked assets. Banks give little or no interest but lending in DEFI earns good pay according to the amount of assets you have locked up.

The risk of borrowers default is virtually zero as the lending platforms make sure of that as their priority. 88mph, Aave, Alchemix, Compound, Oasis Borrow, Venus, TrueFi are different kinds of lending platforms that allows you to earn through DEFI-lending without any intermediary.

You can earn through yield farming

Almost same with defi-lending as there's also borrowing involved. It is done when users place their funds in a liquidity pool and are rewarded a fee (interest) for allowing their assets to be used across the platform either by borrowing or selling. An interest is paid or other types of rewards is given in this situation.

This is researched to be best and popular way of earning in DEFI but it isn't without scam, rug pull or high risk as there are cases of platform owners running off with users staked earnings. OKX, Coinbase, Uniswap, PancakeSwap, Sushiswap and others are decentralized financial platforms that allows yield farming.

You can earn by becoming a liquidity provider

There is a different role for liquidity providers (a middleman) unlike in yield farming, they ensure efficient and rapid token swaps on decentralised exchanges and are paid through transactions fees paid for the trades they helped in. The more trades that conducted via their liquidity pool, the more money they'll earn passively.

Being a liquidity provider would require you buying large volume of security from the companies and it involves a degree of risk especially during bear markets. IXO prime and FXTM are popular platforms to become a liquidity provider.

And to my favourite way of earning passively with DEFI... Staking!

You deposit tokens to earn interests in the same token or in other tokens. Hive is a perfect example of you earning through staking with DEFI. Having your Hive staked earns you approximately 3.01% although the value varies. Saving your HBD earns you approximately 20% monthly, so the higher stakes you have, the higher your passive income.

There are other platforms that pays well for staking but I'll recommend Hive and it's engine token for your staking.

So many other ways to earn with DEFI but I'll leave that to you for more research and be mindful of this when it comes to DEFI earnings...

  • There are benefits but also, there are drawbacks and losses
  • Do your own research before you begin any investment
  • Invest money you can afford to lose
  • Minimise risk by sticking to popular apps with positive reputation

Are you earning passively with DEFI now or you're yet to? Keep earning and don't miss out on it's benefits if you haven't started to.

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Posted Using LeoFinance Beta