I have not done extensive staking or exploration in the DeFi space. The newest thing I have noticed is the advancement in DeFi insurance Dapps. There are many more coming into the space and providing backups for lending and liquidity. I also see many more offerings for DeFi wallets and commercial transaction platforms coming out which lends me to believe it will only be a matter of time before central banks and commercial banks integrate these payment systems and storage functions as part of their digital asset protocol. Lastly, centralized platforms such as Binance have released Binance Chain and are moving into staking Ethereum and even their own ERC-20 tokens such as Reef as well as partering with new DeFi Dapps like Pancake Swap to help provide staking and liquidity/lending in the DeFi space.
I feel like Nexus Mutual has potential to be an essential building block in the DeFi space as we all need some type of insurance and the current way we use and the pricing is horrible! Now people actually have options to choose from. With how rapid everything in the DeFi space is moving I think Dot is doing a very good job with development and being very mature on what projects are allowed on its chain.
There is a new protocol that Iâm keeping an eye on called Whiteheart.finance, from what I can see its a USDC exchange for ETH or WBTC with the addition of options contracts provided by Hegic. Its the same dev as Hegic, but I like this new product because it takes the complexity out of purchasing options contracts for mainstream adoption. Its a really simple but neat idea to protect your purchases with at-the-money put options and the best part is that is all automated. It has yet to launch but I think this could be very popular if it gets enough exposure. Its a way to buy ETH or WBTC with insurance against price declines for up to 14 days, all wrapped into one transaction. Very nice!
It is interesting to learn these things, but Iâm not going to use any of them myself.
The only fair way to use your money to passively make money is by loaning to a business which uses your loan to expand their production and/or services. If your money is being used to produce things, then everyone benefits. Any other way of making money with money is just a trick and it cannot last for long. If someone is making money, and there arenât actually more goods and services because of it, then somebody else had to lose in order for that guy to win. I believe the only reason these defi protocols can have such a high rate of interest is because the people using them also hodl/trade crypto, and these things go up faster than traditional investment tools. But if/when crypto becomes mature, then crypto cannot be an investment tool, because it pays no dividends (unless you are staking, which Iâm okay with because I understand staking helps maintain the network). When they are fully adopted, crypto will be money. You wonât be able to earn money with them any more than you would be able to make money by stuffing dollars or gold coins under your mattress. They still have the advantage over dollars in that they will retain their purchasing power. But anyway, all this stuff you talked about it just a way for smart people to try to outsmart each otherâs money from each other. Iâm not going to be a part of it. The real speculative opportunity in crypto comes from the fact that the purchasing power of fiat will move to other assets (such as gold or bitcoin) as people lose faith in fiat. All this other nonsense with loaning crypto for interest or insuring it is just a way of shuffling this profit from the loss of the dollar between different crypto holders.
Hello there, somehow i missed to make sense of what synthetics are for. to provide liquidity and funding? how does that work? I understand it like that: I pay 100 Dai to get 100 sDai back. What exactly can i do with this sDai?
Or is it just to give liquidity to the platform and the sDai would be some kind of security for me that tells me that i own the real currency (DAi) and can change it back anytime?
I hope thats not to confusing.
I think the insurance is the one of the best. I havenât really looked into anymore of this. All I know that its a major money maker. All banks offer some kind of insurance. I would probably use the insurance if I every use a smart contract, just for safe of mind.
The Cardano project is one I have my eye on with there deployment in Africa.
XLM has massive potential, a open source network for all currencies & Crypto making it more useful and accessible. No third party! lighting fast transactions & affordable. this is the way forward.
@amadeobrands it seems that the link you provided for Altheio is no longer working. Is there an alternative currently available?
I really see a world of possibilities in the DeFi spectrum. I hadnât any previous experience and I am really amazed with what I saw so far in the course, as I understood that all those currencies that I trade on Coinbase or Binance actually have a use case!. I still need to do my due dilligence, but I already have some ideas.
As a context, I am a software developer from Chile, with 15 yr experience on the field. I believe that the following use cases may allow people that cryptos are not speculative assets, but they are a economical system that bring opportunities in a global scale, have a native digital support for trading, and actually they have more sense that the current, FIAT based system, managed by the Fed and the ECB. However, we need massive adoption to get there.
I thought on several ideas, like ETF-styled synthetics that follow different crypto segments, thought for retail investors (say, blockchain ETC, dexes ETC, money markets ETC, and so), also a dapp to enable SMEs to be introduced in global markets (at least in southamerica, we have 12 different currencies and 12 different tax and customs policies), and also a yield account where you can donate money to certain institution, like the Firefighters (in Chile they are volunteers and have little-to-none aid from the government, so they finance themselves by donations). But I wanted to dive deeper into a pretty important subject, which is enabling low-income people to have access to better savings condition that the current CeFi offers them.
First of all, I would create a dapp that allow people to put their savings in DAI. My idea is to aim the 80% of population with lower income, which usually have access to a debit card bound to their national ID, since an APY of 8% in a USD stablecoin is far better than a -2.45% real interest rate in a savings account in CLP (which is basically the only investment that they can do). To match their mental model, I would have 4 products where they can save money, making a tradeoff between liquidity and investment timespan
- Emergency Savings: high liquidity savings account, thought to pay medical emergencies, without a defined timespan to get returns.
- Car Savings: 3-5 years timespan
- Student Savings: 10-15 years timespan
- Home Savings: 20-30 years timespan
I really believe that this will make sense to any latinamerican citizen by the way, as we are the perfect example of Gresham Law (spend in local fiat, save in USD). However, the underlying smart contract should be processed wisely, in order to minimize gas usage, as we aim to a massive user base with a low ticket value.
Hi!
I had the same issue with one of the links in a class, and the browser suggested me to use the web archive project, that allows people to see cached versions of a page, like this one:
https://web.archive.org/web/20201116113536/https://aleth.io/data/defi/evolution-defi-platforms
I hope this helps.
Hi! Just consider that US dollar is also a speculative asset. It is not being backed up by US GDP (130% of debt/gdp ratio is a big warning signal on that direction), nor in a scarce asset, such as gold. The only thing that gives USD value is the global adoption as reserve currency, which means that commerce and global debt is denominated in USD.
As people loses trust in their national currencies, they flee to US dollar as a safe haven. People all around the world is investing money on the US stock market (which they will probably lose), governments are buying US Treasury Bonds, and so.
In fact, governments must balance their USD/local currency ratio, because if dollar rises, we fall in risk of default, as our treasury receives taxes in local currency, and if dollar falls, our exports are converted in less local currency, which makes unviable to pay workerâs wagesâŚ
Hi Amadeo, Thank you for taking the time to make the course and explain everything slowly and clearly a lot of it went over my head a little as Iâm not so familiar with Defi yet but every time I need to know something I can refer back to this course and learn then it will all start to make more sense to me. Thanks again.
Hello Amadeo,
Thank you for all this valuable information! I was looking into ⏠Stablecoins and found EURS. Did you already, or can you have, a look at it? What do you think?
The opportunity to escape the negative interest rates traditional banks provide by buying and depositing a stablecoin and on top insuring it is fascinating. Thank you for providing this insight! Do you have a blog where we can stay up-to-date with your insights? I would really like to learn more from you about analyzing protocols and determining how safe and brilliant a project is.
Edit: But I also understand now, that doing this during a phase of increased volatility, like right now, it is extremely risky to be liquidated very fast. So, please correct me if I am totally off, putting DAI into a vault is a better strategy in times when the markets are less volatile, which in crypto is of course a topic by itself.
The web archive will only provide an image of the past. It seems that aleth io is downâŚ
Iâve been exploring prior to taking this course, Having an in depth understanding of how this ecosystem works helps you understand how new projects are solving problems that you werenât even aware ofâŚ
Paid Network is definitely wort exploringâŚ
I would like to see more information regarding hybrid lending protocols such as Celsius and Nexo and how they compare and contrast to the more decentralized like Aave and Compound. I think these crytpo lending services are more centralized but easier to onboard the average user.
I used to be a mortgage originator in a previous life. The last loan I wrote I remember thinking this is not right, this lady will never be able to repay after her fatherâs income is gone and she will not have a cosigner. Her dad was 95 when the lender approved her subprime mortgage. Then the collapse in 2009. After reviewing the total value of derivatives in the global economy, including mortgage backed securities, it was beyond clear why it went under. I see the importance of the DeFi stack and of derivatives in general and specifically transparency. Good grief, if stockholders knew what was going on, I donât think they would have agreed!
Thanks for the interesting course! Was just thinking regarding the decentralised insurance, how ânormalâ is it that a smart contract fails? Are there any options to look at some rates of malfunctions regarding smart contracts and also, does it depend on the specific blockchain? For example would ADA (when it releases) or DOT be safer options then ETH-based smart contracts? This is maybe a stupid question, but i just became curios.
Thanks again and take care!
Gas Fees WTF!
I went on 1inch to trade 0.1 ETH for roughly $177 DAI. The trade would cost me $25. This doesnât make sense. I would need an interest rate of almost 15% just to recover my gas fees in a year. I would need to perform better if I wanted to cover my gas fees to exit the trade.
1inch being a DEX aggregator, I then assume every DEX has a $25 gas fee or higher for this trade.
I hear that Polkadot and Cardano are supposed to be 2nd layer solutions to reduce gas fees. In the meantime, there just seems to me that there is too much risk for a newbie to be experimenting in the DeFi space.
Am I missing something? Does this really equalize the playing field amongst the rich and the poor?
HI Amadeo,
I am in the middle of completing the Defi 101 course. Just wanted to say thank you for the wealth of information in this course and the clarity and comprehension of our teaching of this course.
I just have a question. In one of the videos you mentioned how we can interact directly with a smart contract in order to buy and sell crypto and this way we can reduce the gas fees that might have to be paid on a DEX like Uniswap. Can you please elaborate on this more? If this is possible, why donât more people use or talk about this? I saw you did a video on Ivanâs channel regarding 1inch, Would you mind doing a video on this topic? Thanks again
The last video about decentralized insurance was really really interesting! I have already been exploring the DeFi space quite a bit but this was completely new to me. Gonna learn more about that so thank you!
Aside from that, another great course 