.png)
.png)
The inspiration for this article came from the unlikeliest source, an ad on a Youtube video I was listening to while in the shower. It went somewhere along the lines of, “our bonds allow investors to earn a market-beating 3 to 5% APY during this time of historically low-interest rates.” It got better… “You only have to lock your money in for up to 6 months to earn these competitive yields!”
My first thought was… HA! But then it brought me back to reality and made me think… are yield farming rates turning me into, dare I say, a degen? I don’t think that to be the case. I really don’t. So now, I’m going to convince myself in this article that I’m not. I think the younger crypto investors call this coping?
Right now, at this moment, I have Vapor/BNB earning me a measly 2,278% APY in a compounding vault. Ridiculous if you stop to really think about it. I calculated the average pre-compounding yield across my portfolio in BSC Defi. I’m sitting at about .5%, per day, or 182.5% APY. So what’s my point? I think it’s time to sit back and take a minute to put perspective on these yields.
With a quick google search, I discovered that “High Interest” savings account find themselves with landing around .5% APY. That’s lower than the average inflation rate. If I leave my money in a savings account, I’m losing.
I had a CD when I was a teenager and deposited small amounts with every paycheck. I remember the interest rate being around 6%, which was considered pretty good! According to bankrate.com, the best available CD’s are about .6% APY, with a 5-year commitment. What?
Using an ETF screener, I sought out the highest yielding bond funds available on the market. The top fund yielding fund with the symbol TYD has a 10.25% Dividend. Not too bad. I know nothing about the fund.
I happen to like real estate investment trusts to diversify into real estate while earning a dividend and maintaining liquidity. Using the same ETF screener, the top REIT offers a 10.19% APY.
Individual stocks often offer dividends and can range in the single-digit territory. I think it is great that you can hold ownership in a company you believe in while earning a share of the profit, but the dividend is usually nothing to get too excited about. AT&T, for example, pays a dividend of about 7.1%.
I was having a discussion with my financial advisor and we got on the topic of stable coins, particularly in De-Fi. He was trying to understand their risk factors after I told him I could pull 20% APY from holding USDT (At the time of writing this the APY for USDT in Beefy is actually 30.7%). Ultimately, it came down to… while the risk factor is low in the crypto landscape, there are obvious risks regarding smart contracts, wallets, etc. Rather than considering this a cash position, it is best to consider it a low-risk crypto position. I can live with that, and the 30% APY it offers. I would not utilize stable coins as the vehicle for my emergency funds, but It’s probably next on the list in terms of the best place to park some cash.
BTC and ETH both come in with APY’s in the mid-teens in Beefy Finance. This may not be the best yield, but considering the hypothetical upside potential, it’s a strong reward for holding the biggest crypto assets long term.
De-Fi liquidity pairs offer APY’s ranging from 30% to 100% on most of the large-cap cryptos, this yield is magnified when a yield optimizer is added into the equation.
When looking back through this list of a wide variety of available interest rates in the market, It’s pretty obvious that the incredibly high APY’s in the hundreds or thousands is simply bananas. Even a 30% APY on USDT is a bit mind-boggling. To me, there are only two variables that exist to account for the high APY’s of BSC yield farming: Risk and market efficiency.
This leads me to one question that I can’t quite shake:
To me, the obvious place to assess this question is the current APY of USDT. If the current savings rate is .5% in your bank, while USDT can earn 30% in Beefy, is the stable coin 60 times riskier than simply holding cash in a bank account. I don’t have a way to measure this, but I find that to be unlikely. It is my best guess that BSC yield farming rates are at a point of extreme inefficiency, and the high rates are not necessarily an indicator of excessive risk (don’t get me wrong, there is plenty of risk, and we should all know that by now).
I think, or at least have a hunch, that more funds will flow into the space causing yields to drop in most cases. That sounds bad, but could also be good for us early adopters of BSC, as the inflow of funds should cause an increase in asset prices. For now, the growth of the ecosystem is outpacing the inflow of funds, keeping rates high and earning potential intact. I’m going to get it while the getting’s good and wait for market efficiency to catch up. At least that’s my bet on BSC.
Disclaimer: Don’t read this to mean a 15,000% APY is simply due to inefficiency and you should yolo next month’s rent at it. Don’t do it.
Ethereum celebrated an anniversary Friday, July 30. The world-changing blockchain that brought us smart chain technology and major innovations in crypto like decentralized finance and non-fungible tokens, turns six years old.
From the depths of Berlin in 2015, the blockchain built to change the world is on the verge of potentially its most important blockchain forks -- London Hard Fork.
As of late 2020, Ethereum has grown too big even for itself. The anticipation around crypto could not be higher for the upcoming fork. The first mentions of these changes came in 2019.
As the confetti settles from the birthday bash, Ethereum is set to make major changes in the functionality of its blockchain. On August 4th, Ethereum will complete its hard fork and take a critical step toward an overarching scalability upgrade of the network. But while all of crypto waits with bated breath, the Ethereum team appears unphased.
“Originally we envisioned something more like a big grant event where all the good things would happen at the same time and [Ethereum] would be a new blockchain and it would be a new protocol and people would have to take a lot of efforts to migrate over but later we've slowly changed the roadmap over to something that's much more incremental,” Vitalik Buterin, co-founder of Ethereum, told the Lex Fridman Podcast in June.
The hard fork results in a new transaction validation system due to the EIP 1559 proposal that passed. The chain will utilize a proof-of-stake system, allowing for more scalability and environmentally friendly consensus.
“Proof of stake happens kind of overtime, and then sharding is added over time, and all of these features get added over time. And so the experience for just a regular Ethereum user will still feel very seamless. It's maybe a little bit more complex than the hard forks that we've already done, but from a user's point of view not by that much,” Vitalik continued.
The updates will incorporate cutting-edge blockchain technology like sharding and move the chain from proof-of-work versus a proof-of-stake. The implications of these changes could bring a more efficient, secure, and sustainable Ethereum blockchain.
The hard fork will integrate five immediate updates called EIPs (Ethereum Improvement Proposals). Each change aims at optimizing and improving the network.
The most controversial and anticipated upgrade, dubbed "London," is EIP 1559. The EIP 1559 will make Ethereum less inflationary and is controversial because it will begin burning fees that previously went to miners.
This upgrade is the central improvement in an attempt to generate greater bandwidth and reduce transaction fees on the chain and is critical to the changeover to Proof-of-Stake.
“I like proof of stake. And I've liked proof of stake for many years, basically because it just requires much less ongoing resource consumption.” Buterin explained to Fridman. And about the benefits of adding validators, Vitalik added: “This is good for a few reasons: one is the kind of environmental rationale that you're not breaking the environment. The second is that you're not taking away electricity and other resources from other people.”
The hard fork does not come without criticism. There is the issue with miners losing their fees and the questions around Miner Extractable Value (MEV) remain unanswered.
Some argue that proof-of-stake will increase the centralization of the chain as well. Vitalik celebrates the environmental benefits of the overall transition and the preferred long-term benefits of the updates.
He welcomes the criticisms as good problems to have and looks forward to solutions. Despite being ‘controversial’ it is still likely the most anticipated fork in crypto history.
As Vitalik told Fridman on the podcast, the user will not see too many changes in how Ethereum will work––the major changes come behind the scenes. The Ethereum chain has fought hard in seeking to solve major scalability issues like congestion and latency.
Throughout, it still holds strong as the second most important blockchain, and rightfully deserved. But if it wants to keep competing, it will need to try and catch up to the speeds and transactions of newer chains like Binance Smart Chain and Solana.
The new updates and their incremental applications should make the next few months––and years––an exciting race for the top crypto and blockchain.
ApeSwap has shifted the date for its seventh Initial Ape Offering (IAO) with play-to-earn protocol, Dragonary, following a change in IAO vesting process enacted by community votes.
BSC.News earlier reported ApeSwap’s partnership with Dragonary on July 29th to collaborate for its seventh Initial Ape Offering (IAO 007). The Decentralized Exchange (DEX) protocol scheduled the IAO for August 2nd. However, due to some quality changes that arose from the new IAO vesting proposal, the ApeSwap team has decided to postpone IAO 007, according to its Tweet, from 30th July.
“With that in mind, we will be delaying IA0 007. The new date for Dragonary’s IAO is set for August 7th at 16:00 UTC,” read the official ApeSwap Twitter communication.
An IAO is a unique innovation created by the Binance Smart Chain-based DEX, ApeSwap. It was designed to support promising projects with fundraising by listing their tokens.
Projects like ApeRocket, Bitfresh, Hifi DeFi, JediYield, HyperuleSwap, and Bishares have shown massive development since utilizing ApeSwap’s IAO platform. Dragonary is the latest to join.
The new vesting process requires that 25% of tokens will be distributed immediately and the remaining 75% of tokens will be distributed over three months.
Notably, the change was provoked by community votes after many ApeSwap users proposed a change in the vesting process. Users voted on a new token claim structure, and the campaign lasted for five days (July 17 to July 21).
To satisfy the needs of its users, the ApeSwap team has created a whole new set of smart contracts. The new smart contracts come with new audits to ensure that users' funds are safe and secure. According to the update, the date for completing the audits has been set, but there will be a need to test, review, and possibly re-audit codes if necessary.
Therefore, the postponement of the IAO is attributed to the fact that the ApeSwap team wants to make sure that the new smart contract codes, including audits, are working effectively. In essence, they want to have enough time to test the smart contracts before launching the IAO with Dragonary.
With this, ApeSwap ensures that the safety of the community is its number one priority. In addition, users can anticipate a flawless IAO for Dragonary.
ApeSwap is a top name in the BSC network. It is the leading DEX on the BSC, which offers users the best trading experience. ApeSwap is a blend of a decentralized exchange, yield farming, staking, and an automated market maker (AMM). ApeSwap users are urged to partake in its liquidity pool offerings via yield farming to earn its native BANANA token. What's more, these earned tokens can be used to stake and earn other tokens and unlock deluxe features.
For more information about ApeSwap, visit the platform's media links:
For now, the growth of the ecosystem is outpacing the inflow of funds, keeping rates high and earning potential intact. I’m going to get it while the getting’s good and wait for market efficiency to catch up.
The inspiration for this article came from the unlikeliest source, an ad on a Youtube video I was listening to while in the shower. It went somewhere along the lines of, “our bonds allow investors to earn a market-beating 3 to 5% APY during this time of historically low-interest rates.” It got better… “You only have to lock your money in for up to 6 months to earn these competitive yields!”
My first thought was… HA! But then it brought me back to reality and made me think… are yield farming rates turning me into, dare I say, a degen? I don’t think that to be the case. I really don’t. So now, I’m going to convince myself in this article that I’m not. I think the younger crypto investors call this coping?
Right now, at this moment, I have Vapor/BNB earning me a measly 2,278% APY in a compounding vault. Ridiculous if you stop to really think about it. I calculated the average pre-compounding yield across my portfolio in BSC Defi. I’m sitting at about .5%, per day, or 182.5% APY. So what’s my point? I think it’s time to sit back and take a minute to put perspective on these yields.
With a quick google search, I discovered that “High Interest” savings account find themselves with landing around .5% APY. That’s lower than the average inflation rate. If I leave my money in a savings account, I’m losing.
I had a CD when I was a teenager and deposited small amounts with every paycheck. I remember the interest rate being around 6%, which was considered pretty good! According to bankrate.com, the best available CD’s are about .6% APY, with a 5-year commitment. What?
Using an ETF screener, I sought out the highest yielding bond funds available on the market. The top fund yielding fund with the symbol TYD has a 10.25% Dividend. Not too bad. I know nothing about the fund.
I happen to like real estate investment trusts to diversify into real estate while earning a dividend and maintaining liquidity. Using the same ETF screener, the top REIT offers a 10.19% APY.
Individual stocks often offer dividends and can range in the single-digit territory. I think it is great that you can hold ownership in a company you believe in while earning a share of the profit, but the dividend is usually nothing to get too excited about. AT&T, for example, pays a dividend of about 7.1%.
I was having a discussion with my financial advisor and we got on the topic of stable coins, particularly in De-Fi. He was trying to understand their risk factors after I told him I could pull 20% APY from holding USDT (At the time of writing this the APY for USDT in Beefy is actually 30.7%). Ultimately, it came down to… while the risk factor is low in the crypto landscape, there are obvious risks regarding smart contracts, wallets, etc. Rather than considering this a cash position, it is best to consider it a low-risk crypto position. I can live with that, and the 30% APY it offers. I would not utilize stable coins as the vehicle for my emergency funds, but It’s probably next on the list in terms of the best place to park some cash.
BTC and ETH both come in with APY’s in the mid-teens in Beefy Finance. This may not be the best yield, but considering the hypothetical upside potential, it’s a strong reward for holding the biggest crypto assets long term.
De-Fi liquidity pairs offer APY’s ranging from 30% to 100% on most of the large-cap cryptos, this yield is magnified when a yield optimizer is added into the equation.
When looking back through this list of a wide variety of available interest rates in the market, It’s pretty obvious that the incredibly high APY’s in the hundreds or thousands is simply bananas. Even a 30% APY on USDT is a bit mind-boggling. To me, there are only two variables that exist to account for the high APY’s of BSC yield farming: Risk and market efficiency.
This leads me to one question that I can’t quite shake:
To me, the obvious place to assess this question is the current APY of USDT. If the current savings rate is .5% in your bank, while USDT can earn 30% in Beefy, is the stable coin 60 times riskier than simply holding cash in a bank account. I don’t have a way to measure this, but I find that to be unlikely. It is my best guess that BSC yield farming rates are at a point of extreme inefficiency, and the high rates are not necessarily an indicator of excessive risk (don’t get me wrong, there is plenty of risk, and we should all know that by now).
I think, or at least have a hunch, that more funds will flow into the space causing yields to drop in most cases. That sounds bad, but could also be good for us early adopters of BSC, as the inflow of funds should cause an increase in asset prices. For now, the growth of the ecosystem is outpacing the inflow of funds, keeping rates high and earning potential intact. I’m going to get it while the getting’s good and wait for market efficiency to catch up. At least that’s my bet on BSC.
Disclaimer: Don’t read this to mean a 15,000% APY is simply due to inefficiency and you should yolo next month’s rent at it. Don’t do it.
