While most crypto investors are tightening their belts in the current bear market, crypto-millionaires have benefited from innovative decentralized finance (DeFi) products including Uniswap, Aave, Changing pancakesDAO Maker and auto-custody wallets like MetaMask.
The bear market is wreaking havoc on the average crypto investor. However, why not learn how the benefits of decentralized finance (Challenges) make millions using tools you may never have heard of?
Tip #1 for crypto millionaires: find Uniswap gems
Exchange is a decentralized exchange (DEX) based on the Ethereum blockchain that offers DeFi enthusiasts the opportunity to earn transaction fees contributing to its liquidity. Anyone can make markets by depositing both assets of a trading pair into a smart contract, removing the middleman in creating liquidity.
DEX charges a commission of 0.3% on all trades. Thus, liquidity providers earn passive income from these fees, which is proportional to the amount of liquidity they provide, minus any permanent losses.
Suppose you deposited 4 DAI and 4 USDC. The ratio between them is 1:1. Any change in the price ratio between the two cryptos results in a permanent loss. Liquidity providers prefer high trading volumes and low permanent losses.
Sometimes traders create markets with less famous altcoins, called “gems”. These are crypto-assets with a market capitalization of less than $20 million, but which have strong fundamentals and the potential for a 100-fold price increase. Traders can use Uniswap to trade ahead of the market, before these coins are listed on crypto exchanges and rise in price.
or crypto trader turned $800 into $1,000,000 trading less than a day old assets and making a profit in less than 3 hours. This dealer found out these assets through bots Uniswap listing and pre-sale marketing telegram.
Crypto Millionaire Tip #2: Aave
To generate passive income, crypto-millionaires also use Aave, a borrowing and lending protocol that allows dedicated users of the DeFi platform to earn passive income.
Lenders who deposit funds into a smart loan contract earn interest determined by an algorithm. Borrowers in turn deposit the collateral of a crypto asset into a borrowing smart contract to earn returns or borrow other cryptocurrencies. They can generally only lend assets up to 75% of their collateral.
One way to use these to their advantage is to deposit an asset such as Bitcoin, which gives low returns in DeFi due to its large ownership, to borrow a stable currency. Traders can then earn a higher return on stablecoins by depositing them in a pool of cash DEX. Aave also offers an annual percentage rate of 8% for USDT stablecoin borrowing.
If your collateral falls below a certain threshold, Aave will liquidate your position and forfeit your collateral. Because of this risk of liquidation, many people do not want to participate in this activity.
Crypto Millionaire Tip #3: Yield Farming
asset Changing pancakes, traders earn liquidity provider tokens by contributing a pair of cryptos to a liquidity pool. So the LP token (liquidity provider) allows them to access a FARM on the DEX, ie a production farm, and where they can place their LP tokens with other traders to earn annual percentages between 2% and 200%. They are then paid in tokens CAKE through a process of “harvesting”, or “harvesting”.
To maximize profits, CAKE tokens can be collected automatically or manually and reinvested in the same pools using The syrup pool.
Crypto Millionaire Tip #4: IDO
An initial DEX offering (IoT) is the new method discovered by cryptomillionaires. A decentralized protocol collects funds from investors by issuing a token, which can represent a newly listed asset on their platform.
DAO Maker is an incubation and fundraising platform for new decentralized autonomous organizations and distributes DAO tokens to investors in these projects. DAO token holders who are proven investors can participate in an IDO Strong Hold Offer (SHO) token sale.
Since its launch in 2021, the DAO token has generated returns of up to 41x for early investors.
Crypto millionaire tip #5: Self-custodial portfolio
To use DeFi products, it is often necessary to have a crypto-custody or self-custody wallet. wallet).
A portfolio (or wallet) crypto is software or a device that, in short, stores unique strings of numbers and letters, called keys, that authorize your access to cryptocurrencies. Each wallet contains a public key and a private key. The public key is used to send cryptocurrencies to someone, while the recipient can use a private key to spend cryptocurrencies in their wallet.
When a user wants to spend cryptocurrency in their wallet, they present a public key and a signature generated from the private key. These two pieces of information tell the blockchain network that the spender owns the funds they use.
While some crypto users leave control of their keys to companies like Coinbase, Binance or Kraken, users who engage heavily in DeFi generally retain control of their own keys. So they store them in a self-custodial portfolio instead of a custodial portfolio managed by a company.
The responsibility for controlling and managing these keys then rests exclusively with these users. If they lose their private key, they lose access to their crypto because they cannot create a public signature to spend the digital assets they receive. Hence the mantra “Not your keys, not your crypto”.
The most popular self-care wallets
Once installed, the software MetaMask it will ask you to enter a password and create a wallet for you. It will then display a 12-word mnemonic that will allow you to recover your funds if something happens to your device. It is essential that you store this phrase securely, as anyone who finds it will have access to your wallet.
The book of the book The Nano is a USB-based hardware wallet that works through a plug-in app. You can buy it from Amazon or directly from Ledger, although the latter is a safer option.
After installing the app, you will be asked to answer a few questions to ensure that the device still has the same security programmed at the Ledger factory. The device will then present you with a reminder code that you should keep in a safe place.
How much for MetaMask, mnemonic is the only way to access your funds. Once saved, you can move your crypto between exchanges by creating an account on the partner app for each of the coins you want to move.
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