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Getting 20% APY on Stable Coin?
- Thread starter Silvio
- Start date
So I will punt my take on it:
I am using Swissborg/BlockFi/Celsius.
1) you have shown Swissborg this one goes around DEFI projects and pays you yields from DEFI projects arround. this is uniqe buisnes model comparing to others. Rates are usualy lower than anywhere else. They are good to do divesification of funds.
Why people use DEFI ? and pay 9% "fees" XD in bull run we chase ponzi, some people will clean their trace of assets they will sell it with 9% discount.
Real reason is that on bank account you will have 0% so people go into crypto play ponzi. If I was noob for sure I would take ride with swissborg even with their fees.
2)Blockfi/Celsius/Nexo this one can be tricky to explain becouse there can be many reasons possible.
Best most important is borrowing fiat aganist your asset is tax free, till time you are liqudated xD. So imagine you can sell your BTC now but this is bull run it can make x3 - yes? Then better will be borrow now 100k USD don't pay short-therm tax 20-40% on that. But borrow against your asset you can use 100% capital today no taxes today. You have your BTC still. After 4 years you owe to pay like 150k, but BTC colatrarazed for that is worth 3x more. So in reality you ow like 50k, if you add inflation it will be like 38k for Americans. And what is more important you pay after 4 years tax that is worth -6%-6%-6%-6% inflation. XD. So in many countries you have tax free income becouse you postponed tax. I don't know how many people will have such thinking.
Many of them will think I will never pay it back becouse on average BTC have risen +100% every year so in teory you can have that loan forever.
Downside is that if you have to much leverage it can easy wipe you so in reality is keep 20% LTV loan in asset.
3) On market there are buyers and sellers if someone want short USD/USDC or BTC he have to borrow it, becouse we are in bull run is easy to make profits. BTC makes ATH means there is noone in "-" maybe short players.
Big taxes on crypto gains + inflation can realy fuel that lending.
Now best part from other USD side. Is realy good to "lend" USDC on 10% than sit it on current balance. That cans will go to lenders and will be used to pump market on leverage even more. We have real supply of USD/USDC to crypto market and it won't end till we have REAL POSITIVE INTREST RATES XD.
We will fuel that ponzi much more IMO.
For me Blockfi,Celsius,Swissborg are most trustworthy in cryptomarket brand is most you have to lose. Nexo(noone realy know where find people who run your part - no company adress at all, one of coofunder was running p2p lending scam, some others located in Sychles/Cyprus/Malta).
Crypto.com is so appealing but in reality funding F1 / stadiums will cost a lot, that reminds me Madof ponzi in US to much, they are burning a lot of cash on marketing. If all around gives you 8% APY and some gives you 2x that I bet it will be exit scam.
Till bull run most those big APY platforms won't go down in bear market we will see where king is naked for sure.
BlockFi may be transparent, but they've changed their rates for everything besides stablecoins to almost nothing, and those changes were mostly from one day to another. Their interest is also paid monthly which sucks and they have penalties and such things, looking at their ToS alone should be enough to not use them.
Crypto.com has $700M insurance which covers things like theft, which is nice, but not really relevant unless the money stolen is just a fraction of the assets being held by them. It's still a good platform though and I have nothing against them.
Binance should be above Crypto.com though, they're the biggest platform, have their own crypto (crypto.com too but it's not as big and as used as bnb) which is the second one by market cap and they handle over 60-70% of all the volume in crypto. Yes, they have been hacked, but each time users were compensated and issues were fixed, which makes the platform stronger against future attacks.
Celsius should also be above BlockFi as they're trying to comply with every state in the US and everywhere they operate. If they're not sure it's legal, they don't do it, such as letting US users use their CEL tokens as they may be considered securities by the SEC, but as they're not sure, they don't allow it. The founder is a known person for his work in Tech, they do weekly AMA's and they're transparent about their investments, earnings, and such things. They've, for example, announced that they've invested $500M into crypto mining. Diversifying user funds should also create a more secure and stable way to earn income for the company and therefore its users.
Edit:
As the user above said, Nexo does also have some sketchy things going on and I've read about the sketchy founder activities.
Also, he's right about crypto.com, they're spending a lot on marketing, but I'm pretty sure they've been able to do that with their platforms earnings and their token.
My rating would be this is for credibility/reward ratio :
Celsius > Blockfi > Swissborg > Nexo > Binance > crypto.com > youholder
since most TOS of any crypto business is that you own nothing and will be happy then arguing about these TOS are pointless. If someone call tango down on any of them you will lost 100%. Insurance covers usually like 0.1- 2% of total assets.
Mine, from personal experience, would be something like:
Celsius/Binance -> Crypto.com -> BlockFi
I omitted Swissborg and YouHolder because I've never used them and Nexo because I think it's too sketchy
If I had to choose one, it'd most likely be Celsius because I feel they're very transparent, have a professional team, a known and savvy tech billionaire founder and they're diversifying users' funds in different sources of income which is nice because they won't only live off the lending they do. Plus they have weekly interest and 0 withdrawal fees.
Sounds like very risky stuff, and as you said in bear market many of these people should be liquidated and these loans will die out as well.So I will punt my take on it:
I am using Swissborg/BlockFi/Celsius.
1) you have shown Swissborg this one goes around DEFI projects and pays you yields from DEFI projects arround. this is uniqe buisnes model comparing to others. Rates are usualy lower than anywhere else. They are good to do divesification of funds.
Why people use DEFI ? and pay 9% "fees" XD in bull run we chase ponzi, some people will clean their trace of assets they will sell it with 9% discount.
Real reason is that on bank account you will have 0% so people go into crypto play ponzi. If I was noob for sure I would take ride with swissborg even with their fees.
2)Blockfi/Celsius/Nexo this one can be tricky to explain becouse there can be many reasons possible.
Best most important is borrowing fiat aganist your asset is tax free, till time you are liqudated xD. So imagine you can sell your BTC now but this is bull run it can make x3 - yes? Then better will be borrow now 100k USD don't pay short-therm tax 20-40% on that. But borrow against your asset you can use 100% capital today no taxes today. You have your BTC still. After 4 years you owe to pay like 150k, but BTC colatrarazed for that is worth 3x more. So in reality you ow like 50k, if you add inflation it will be like 38k for Americans. And what is more important you pay after 4 years tax that is worth -6%-6%-6%-6% inflation. XD. So in many countries you have tax free income becouse you postponed tax. I don't know how many people will have such thinking.
Many of them will think I will never pay it back becouse on average BTC have risen +100% every year so in teory you can have that loan forever.
Downside is that if you have to much leverage it can easy wipe you so in reality is keep 20% LTV loan in asset.
3) On market there are buyers and sellers if someone want short USD/USDC or BTC he have to borrow it, becouse we are in bull run is easy to make profits. BTC makes ATH means there is noone in "-" maybe short players.
Big taxes on crypto gains + inflation can realy fuel that lending.
Now best part from other USD side. Is realy good to "lend" USDC on 10% than sit it on current balance. That cans will go to lenders and will be used to pump market on leverage even more. We have real supply of USD/USDC to crypto market and it won't end till we have REAL POSITIVE INTREST RATES XD.
We will fuel that ponzi much more IMO.
For me Blockfi,Celsius,Swissborg are most trustworthy in cryptomarket brand is most you have to lose. Nexo(noone realy know where find people who run your part - no company adress at all, one of coofunder was running p2p lending scam, some others located in Sychles/Cyprus/Malta).
Crypto.com is so appealing but in reality funding F1 / stadiums will cost a lot, that reminds me Madof ponzi in US to much, they are burning a lot of cash on marketing. If all around gives you 8% APY and some gives you 2x that I bet it will be exit scam.
Till bull run most those big APY platforms won't go down in bear market we will see where king is naked for sure.
Yes this is risky. But risk in not equal for everybody people. Loans in crypto are overcoatelazed usualy Celsius/Blockfi have LTV like around 50% so price have to fall more than -50% to get liqidated.
For me there is like 1:10 ratio between loand givers / loan takers at this point, becouse there is more corateral than liability. In classic banking there is oposite XD... to be honest faster yours bank go under than some of those companies.
Next big thing why this not end soon is that you are afraid - super for me that means not much inteligent people came here for yield there will be more in the future. They will come into crypto space becouse of % returns banks vs defi/cefi this proces can be reversed porbably only when REAL intrest rates will be possitive. I don't see that real rates would bancroupt allost every country in the world at this debt lvl. So we are living in evoirment where you are loosing for sure 5-10% year to year in bank acc EU/US. Money will flow to CEFI/DEFI system that will give more cash for borrowing > that will give abilty for more lavreage crypto assets > that will pump prices higher. The real problem is that traditional economy is giving you negative returns people will come here. At 140k-250k I will exit some lending systems now I don't see any good reason to go outside and park money for -5% to -10% annually.
Next thing if they teper and make stock market fall like -50%. That will caouse sure crypto fall like -90%. Now bit risk managment PE on US SnP500 is like ~40 now XD... PE on CEFI/DEFI is ~10.
If you use 4 CEFI platforms with PE 10.
Now on CEFI you earn 4x more than on SNP500.
Markets goes tango down SnP goes -50%.
2 of 4 CEFI also goes tango down -50%.
So yes you lost capital in CEFI but same capital can belost in SNP500. Both worlds are addicted to money printing... Goverments can not stop money printing becouse noone will elect them - this is our clown world.
That is why I don't affraid so much everywhere where you want earn you risk. From CEFI/DEFI I was trying get "safest" place to park and spilit load.
IMO you should try, a bit I am not risking there more than 13% my current portfolio. (4% Blockfi 5% Celsius 4% Swissborg). Since I am crypto guy I am risk tolerating person. If BTC hits 140k-250k and overheat I will 1st jump the ship belive me.
Regards
It depends. The only crypto company I got a KYC request from is crypto.com. I made over $100,000 in deposits and they wanted to known the source of funds. I sent over some documents that would raise eyebrows if presented at any EU bank, i.e. obviously offshore. I never heard from them again. At current. KYC is mostly someone with a few weeks training ticking a box. I have not heard from them since, and since then I have made a few hundred $K in transactions on there. When there was a story about some guy from Netherlands who could not get his funds out of BitStamp because of a new law in his country, I pulled most funds from there. I previously had a lot loaned out on there. I've used their card in numerous risky countries, like Russia, Ukraine, Belarus and Moldova and never heard anything.
I've also used Wirex. I think I deposited a low $xx,xxx and immediately removed the funds. No questions. But I used their card a few times in Serbia and they asked for proof of funds. I said I can't be bothered to send it, and they closed my account.
I've deposited around $30,000 on FTX several times and had no questions.
In terms of crypto assets, any controls are much lighter.Some exchanges don't need any real info on you unless you are transacting more then at least $100,000. The lowest level of KYC can get you daily withdrawal allowances of several hundred thousand.
The regulation issue is with fiat, particularly the dollar.
I use euros for deposits. Avoid making international USD wires if possible.
It's possible someone will go down with that, but there have been lots of companies offering leverage and lending for at least seven years and I've not heard of one who has gone under from failing to close underwater positions.
It's gotten a bit quiete in here
I lost a ton of money when UST went under and I am sure some of you did as well. It was a very complicated system, I feel like the more complicated, the more likely you are running into a Ponzi scheme. Anyway, lesson learned. From now on it's 100% Bitcoin and I am not lending anywhere. Take most of it off the exchanges. That seems to be the safest strategy if you are looking at hodling for the next 4 plus years.
I lost a ton of money when UST went under and I am sure some of you did as well. It was a very complicated system, I feel like the more complicated, the more likely you are running into a Ponzi scheme. Anyway, lesson learned. From now on it's 100% Bitcoin and I am not lending anywhere. Take most of it off the exchanges. That seems to be the safest strategy if you are looking at hodling for the next 4 plus years.
Lending is not a bad thing, obviously 19.7% apy is too much…
Many bad apples have gone, the ecosystem has become much healthier.
Many bad apples have gone, the ecosystem has become much healthier.
Failures make the echo system more robust. Unlike the banking sector, where failures are not allowed and lead to the failure of the entire echo system.
There is no return without risk, by definition.
Yes, banks are bailed out, and zombie institutions are kept afloat, which is a whole other scandal. But anyone using the words trust and the best choice with Celsius should feel ashamed. It was picking up pennies in front of freight trains.
Do you think the ecosystem is better for it, though? I can see something coming along that does the same thing (holds your keys or has an admin key) and people still flock to it.
Holding keys is a necessity for some applications. I see good and bad players, it might be a similar situation as the dotcom bubble burst, from which Amazon emerged.
For example I like SwissBorg.
I like it too but to be honest there is a lot of risk withing space.
If you hold crypto with swissborg this ls like broker, you have that under your own name then cannot run away with it.
That part is good.
Bad part is once you use DEFI with them then you use their entity in BWI (and now they are not like broker) your money are no longer yours.
Good to know pros and cons - from all platforms their business model is sustainable.
They take fees don't chase degen investments etc. - they live.
(anyway, similar was Nuri they filled bancruptcy so this kind of services fails too)
Now CEFI space this is real s**t guys. CEFI model is proven to be failed.
Most big players in CEFI failed this bear market
BlockFI,Voyager,Celsius,Genesis some was rescued by external factor becouse they had small hole to fill.
The point is those companies lend your crypto to degens like 3AC who use stuff like LUNA/UST.
People go where they get best yield while best yield means taking most risk on chest.
Other players seeing high yield on eg. Celsius need to add risk to match their yields and after some time all of them end with same failing entity.
...
Ok so you would think that yieldapp/youholder/nexo they are ok they alive. Yes but in reality we don't know what is behind scenes small companies can be bailed out then take loand from some founder and in next bull run when it will grow to eg. Celsius size. Then they can be milked by founder and collapsed same way like Voyager/Celsius on bad debt.
If you want guys play that lending market better learn how use defi directly like AVAE/CONVEX/BALANCER etc. there are at least honest how you get yield. You will get variable apr risk, but you won't get caught with pants down on some exit scam.
PS: Fun story Celsius insiders have taken multimillion loans on their CEL token day before they filed for bankruptcy and closed withdrawals. Real pro top management move.
Do your own judgements.
My takeaway is that CEFI have no sense.
BTW do you know that if company in US files for bankruptcy like Celsius it can go after you. They can try clawback what you took out 90 days before they filed for bankruptcy. So, you can lose theoretically more than you have there ever.
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