PrivacySwap DeFI Yield Farming Helps Crypto Holders Earn Interests During a Bitcoin Crash
Cryptocurrency has experienced depression and noticeable fluctuation over the past few years. The dramatic drop in the cryptocurrency market was exacerbated on Sunday, as a series of Chinese crackdown measures unsettled investor mood. With that, the cryptocurrency has lost over $1.3 trillion since its market peak on May 12. It even triggered billionaire Elon Musk to announce that Tesla will no longer buy Bitcoin until it can be sustainably mined with little impact on the environment.
Despite all of these, cryptocurrency markets continuously display great statistics. They have showcased a firm grip on the world’s market over the past few years. Hodlers were able to see a beacon in those dark and uncertain tunnels; that is by yield farming.
What is Yield Farming, and How Can it Help You During Such Downfalls?
Yield farming is the new trend in the crypto world. The core purpose of such technology is to allow consumers to temporarily stake their crypto into yield farms in exchange for more cryptocurrency. At its most basic level, a yield farmer may transfer assets around inside a yield farm’s different farm, always chasing the pool with the highest APY from week to week. This may need to shift into riskier banks on occasion, but a true yield farmer can manage risk.
Yield farming as a concept began on the Ethereum network. It has seen a massive spike in transaction fees and has since branched out to other networks like Binance Smart Chain or MATIC, and Solana. The general premise is the same with yield farming: a cryptocurrency that would otherwise sit in an exchange or a wallet is leased out via DeFi protocols to profit back to the users. At the same time, it can also create value by giving yield farms the ability to seek out high reward farms and bring those to the users.
Alongside that, the term “liquidity mining” has also become a hot trend these days, and investors are becoming more interested in such topics. Which concept is receiving a token and the expected return they receive in exchange for the farmer’s liquidity.
Having all that said, How Can yield Farming Help You, Especially During the Bitcoin Crash?
Yield farming is usually done on Ethereum with ERC-20 tokens and Binance Smart Chain with BEP20 tokens, and the incentives are respective to their chains’ tokens.
While this may change in the future, the Ethereum and Binance Smart Chain ecosystem now houses most yield farming transactions. Hence, the Bitcoin crash will make other HODLers move to another cryptocurrency to secure their assets and earn more on their investments. In other words, the cryptocurrency world does not revolve around Bitcoin alone. Other cryptocurrencies continuously prove themselves in the market despite any challenges they face.
Also, yield farming can offer a more attractive income than a regular bank, but there are hazards associated as well. Interest rates are variable, making it difficult to forecast what your returns will be in the following year — to say nothing of the fact that DeFi is a riskier environment in which to invest.
Significance of Yield Farming
Yield farming is significant because it may assist projects in obtaining early funding. Still, it is also beneficial to both lenders and borrowers. It simplifies the process of taking out loans for everyone as well as putting their assets to use instead of just having them sit there.
Those that make enormous profits usually have a lot of money behind them. Those looking for a loan, on the other hand, have access to cryptocurrencies with meager interest rates — as low as 1% APR in some cases. Borrowers can also quickly deposit the money in a high-interest account.
In addition, yield farming in PrivacySwap secures your assets at ‘vaults.’ Despite what the word vault intends, your assets are not locked in a literal vault. Instead, Vaults allows users to entrust their valuables to a smart contract in order to generate a profit. Each vault has its own technique for boosting yield, which is documented in the underlying smart contract code. These vaults are set up to reinvest your money automatically in order to increase your profits.
Furthermore, the future of yield farming can be uncertain as the present levels of excitement and anticipation may put too much load on the Ethereum or Binance Smart Chain networks, resulting in congestion issues. Any price corrections that ensue might leave some farmers unable to sell their investments, which might have a negative impact on total yield confidence.
Regardless, it is good to start getting involved with such options as they are much more sensible than having all your money in the bank, earning meager returns. Put your assets to good use while waiting for Bitcoin prices to go back up.
PrivacySwap is conducting free classes every Wednesday on “How To Make Money During Bitcoin Crash With Yield Farming.” Check their website and official social media pages for more information and update:
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