2 years ago
For years, cryptocurrency advocates person touted the world-changing capableness of integer currency and blockchain technology. Yet with the passing of each marketplace cycle, caller projects travel and go, and the promised inferior of these “real-world usage case” projects fails to satisfy.
While a bulk of tokens committedness to lick real-world problems, lone a fewer execute this, and the others are specified speculative investments.
Here’s a look astatine the 3 things cryptocurrency investors tin really “do” with their coins.
Lending
Perhaps the simplest usage lawsuit offered to cryptocurrency holders is besides 1 of the oldest monetary applications successful finance: lending.
Ever since the decentralized concern (DeFi) assemblage took disconnected successful 2020, the opportunities disposable for crypto holders to lend retired their tokens successful speech for rewards person multiplied.
Blue-chip DeFi protocols similar Aave, Maker and Compound connection tenable output connected stablecoins, and lesser-known protocols often connection higher rewards successful an effort to pull liquidity.
Recently, the crypto lending tract has expanded into realms that are typically dominated by accepted finance. This is particularly existent for existent estate, wherever a fig of experimental cryptocurrency-based owe and listing platforms are making headway.
Platforms similar Vesta Equity and the newly launched USDC.homes connection crypto holders the accidental to collateralize their assets to get a owe oregon lend them retired to aspiring location buyers successful speech for semipermanent yield.
Stablecoin farming
Another mode to enactment the hodl container to usage is by farming stablecoins. The cryptocurrency marketplace is good known for its precocious volatility and high-risk trades, but earning a output connected stablecoins is simply a safer mode to turn a portfolio without the downside hazard of investing successful Bitcoin (BTC) and altcoins.
In bull and carnivore markets, liquidity is required for DeFi protocols to relation properly, and the integration of stablecoins connected centralized and decentralized exchanges has helped the marketplace mature and enactment sufficiently liquid.
Platforms similar Curve Finance, Beefy Finance and Trader Joe connection output connected stablecoin liquidity pools, and rates tin scope arsenic precocious arsenic 20% APY.
Related: Bipartisan measure to springiness CFTC authorization implicit exchanges and stablecoins
No-loss token offerings
Another mode to “use” cryptocurrency is by participating successful the no-loss token offerings launching crossed the ecosystem.
An illustration of a no-loss token offering is the parachain auctions that hap connected the Polkadot and Kusama networks. In this benignant of protocol launch, investors funny successful supporting a task tin fastener up DOT oregon KSM for a specified play of clip arsenic a signifier of collateral backing for the project.
Contributors person the autochthonal token of the recently launched protocol In speech for locking their concern successful the project’s astute contract. After the designated lock-up play is complete, the full equilibrium of tokens is returned to the contributor, meaning they clasp their archetypal holdings portion besides adding caller assets to their portfolio.
Lockdrops are different illustration of this benignant of no-loss token offering. One was precocious employed during the launches of Astroport and Mars Protocol.
Lockdrops person besides been referred to arsenic airdrops due to the fact that they technically don’t assistance projects rise funds, alternatively they necessitate immoderate level of committedness for aboriginal usage from token recipients. While airdrops conscionable administer tokens to users who opt-in, lockdrops necessitate funny parties to perpetrate to locking up immoderate liquidity that tin beryllium utilized by the task during its archetypal launch.
The Astroport motorboat progressive a caller liquidity bootstrapping signifier wherever contributors could supply liquidity excavation pairs successful speech for a higher reward level. Upon lockup, a one-time lockdrop reward is distributed to participants to hold, commercialized oregon usage to supply liquidity.
Liquidity providers besides person trading fees and different incentives depending connected the liquidity excavation they are successful arsenic a mode to amended the accidental outgo of providing that liquidity.
Once the agreed-upon lockup play is complete, users are escaped to region the liquidity.
No nonaccomplishment token offerings springiness semipermanent crypto holders a accidental to gain tokens for recently launched protocols successful speech for output and a prime of what token they would similar to accumulate arsenic a reward.
Want much accusation astir trading and investing successful crypto markets?
- Vesta Equity and Algorand respire new beingness into existent property tokenization
- Looking to instrumentality retired a crypto loan? Here’s what you request to know
- Web3 solutions aim to marque America’s existent property market much accessible
- Decentralized finance: The champion ways to enactment and operate
- Decentralization ‘absolutely essential’ successful building crypto superior markets
The views and opinions expressed present are solely those of the writer and bash not needfully bespeak the views of Cointelegraph.com. Every concern and trading determination involves risk, you should behaviour your ain probe erstwhile making a decision.
English (US) 