DeFi brings the Secret to Passive Income to the Masses

DeFi has opened the world of passive income to everyone. 

Cryptocurrency is changing user behavior in that more people are interested in investing in crypto. According to a recent CNBC poll on SurveyMonkey, 11% of people in the U.S. have invested in crypto, with nearly one-fifth of men (17%) and 7% of women.

Clearly, 11% is still a minority of American investors, but it is not an insignificant number of retail investors and it puts crypto in line with other forms of investments. The study showed that nearly a third (31%)of the general public owns individual stocks, a quarter owns mutual funds (25%), 12% own bonds, 11% own cryptocurrency, and 10% own Exchange Traded Funds (ETFs).

Although most of these retail investors started before the impressive Bitcoin bullrun which has arguably been going on for nearly two years, with some minor setbacks and correction, crypto investing has brought the idea of investing itself to the forefront of media discourse — and perhaps more impactfully social media attention, with TikTok quickly becoming a significant way to reach and educate new crypto investors. 

Due to mainstreaming it is also creating behavioral changes among “normies”, causing users to explore traditional investing, with new retail investors starting younger and accepting investing as a part of their lives and incomes more widely than they ever have before.

And there is so much interest in passive income — you can see it discussed every day on Twitter, extolling the virtues of “earning while you sleep”. Passive income was specific to the rich but it has become available to everyone — but is it for everyone? Can anyone participate in the creation of passive income? Doesn’t it still “take money to make money”? The simple answer is, “kind of” to all of the above. 

DeFi bringing passive income to the masses

• If we owe the existence of cryptocurrency to the superstar token, Bitcoin, then we owe the proliferation of real-world use cases to DeFi — specifically the smart contracts introduced by (but now not exclusive to) Ethereum. Smart contracts have given us everything from the super-popular NFTs, lending, insurance, and a range of financial services that feasibly can replace the roles of traditional banks and bring banking services to the billions of underbanked and unbanked people in the U.S. and worldwide. Hypothetically, because we see no sign that has happened yet, but the capability is there.
  
  In the meantime, DeFi has the buzz because it offers what the crypto audience loves more than anything — the chance of gain. And there are many ways to passively earn through DeFi. All it takes is a little seed money — just like traditional finance — and some patience. Ways to create passive income with DeFi include, but are not limited to:
  
• Interest-Bearing Crypto Accounts
• Peer-to-Peer Lending
• Cloud Mining
• DeFi Lending
• Dividend-Paying Tokens
• The Ever-Popular Yield Farming

There are more ways to earn with DeFi every day, so we won’t try to cover all of them here. Instead, let’s focus on investing in Liquidity Pools.

Diving in to Liquidity

Money is undeniably power in a capitalist society, and the virtue of having money has always been rewarded with more money provided you can invest with reasonable safety. But safe investments give minimal returns, and the sense of unrest that pervades 2021 leave many unsurprisingly, looking for something a little faster, more aggressive, and naturally higher-risk. Investing in crypto gives you the high-risk, high-reward trade off — Liquidity pools help hedge some of that risk.

The idea is simple — from the point of view of the blockchain network and cryptocurrency you are using, they are incentivizing positive participation in the network by encouraging people to hold (or HODL) their crypto. Now crypto assets are their own reward even when you don’t choose to sell, because you can put your cryptocurrencies to work by investing in liquidity pools.

Liquidity pools allow investors to pool their assets in a Decentralized Exchange’s (DEX’s) smart contracts to provide liquidity for traders to swap between currencies. They make trading crypto easier, quicker, and more widely available for more investors and all you as the owner have to do is agree to HODL your crypto and allow it to be lent out to others.

Liquidity pools enable decentralized trading, lending, yield generation, and much more. They form a core component of the DeFi technology stack. Liquidity pools are basically a collection of funds that are locked into a smart contract and used to facilitate decentralized trading and unlock a wide range of DeFi applications. 

Users are putting their assets to work instead of keeping them locked up waiting for price hikes. It does this through value-driven liquidity pools. Today, these liquidity pools form a core part of many decentralized exchanges (DEX). As liquidity is added, DEX’s are adding tokens to the pool and creating new markets. 

Cross-Change Earning with Liquidity

Chainge Finance, the world’s first app-based DEX has been making inroads in expanding the capabilities of liquidity pools through its dedication to cross-platform interoperability. 

Traders can now execute trades with no counterparty required. As the Liquidity pool funds are deposited into a smart contract it allows anyone to trade directly with the contract and skip the intermediary. All the trader needs is sufficient liquidity in the pool. 

Chainge DEX provides an easy entry point for traders wishing to start on their liquidity journey by offering a seamless user experience and cross-chain transactions whereby it doesn’t matter what chain your assets are on, they will appear on the Chainge app dashboard.

Algorithm-Based Pricing

The transactions are based on distributed tokens that are algorithmically given to users who put their tokens into CHGE.

The DEX gives investors the ability to experiment with different pairings. CHNG Pairs for APYs and CHNG Rewards, USDT Pairs for APYs and Rewards, Futures Pairs for APYS and CHNG Rewards. 

Thanks to Arbitrage, the rate of returns continues to increase over time. This turns the traditional investment funds upside down by allowing users to manage trades like a pro without the exorbitant fees and knowledge barriers. Any CHNG holder can collect fees from traders who rebalance their portfolio using arbitrage.

Breaking Down the Yields

There are over 150 liquidity pools operating on the market with the TF-USDT/USDT futures pool brandishing a Total Value Locked of $20.6 million, with rewards in $CHNG in it standing at 108.917%

The Chainge liquidity pools provide some of the highest annual percentage yields (APYs) on the market. By attaching the APY to the price of their native token, CHNG, it ensures high returns. To break it down for beginners, the token is secured by users who then have access to liquidity pools that allow them to earn additional yield.  

The Spot and Futures liquidity pools provide payouts to all participants in native platform CHNG tokens, ensuring full transparency and instantaneous transfers of rewards. Liquidity mining with Chainge is thus made easier than with any other service on the market, as users can claim the rewards directly by receiving them in their wallets in real-time.

Chainge DEX offers traders the opportunity to add liquidity for Spot, Futures, and Options assets in a simple step-by-step process on the Chainge App. The easy-to-use Chainge Defi app empowers people to become their own digital bank. With new automated financial services, users will have complete control over their wealth while enjoying 100% security. 

Summary

Chainge is just one way to explore passive income through DeFi, with a relatively low barrier to entry and a range of options, but as always DYOR (Do Your Own Research) — look for the solution that suits your needs best, and as always with volatile investments, don’t invest more than you can.

Investor participation in crypto across a wide range of protocols is pointing towards a broader and brighter DeFi future. Making it easy and giving fast access to high-performing liquidity pools gives Chainge Finance a leading edge. 

Download the Chainge Finance App today to check out the Chainge Liquidity 

Cover image created with elements by Mohamed Hassan and Gordon Johnson from Pixabay