This is a video that goes into detail on the current hot topic of CRYPTO LENDING. Why you should do it with the advantages benchmarked against the risks. What is the difference between centralized and decentralized players and a whole bunch more to help you make a safe decision in this wild west world of crypto lending.
Timestamps:
0:00 Should I land my crypto to earn interest?
0:20 My point of view from a financial risk management perspective
0:50 The reasons to lend your crypto. You need passive income and the returns are better than most other investments so is it a no-brainer?
1:30 So why do others want to borrow your crypto? Margin trading and short selling details
2:00 Why is crypto lending growing so fast? Up sevenfold in less than a year.
2:30 The two types of lending platforms. Centralized and decentralized platforms outlining the differences
3:00 Details on the top centralized lending platforms BlockFi Celsius and NEXO. KYC and Custodial services.
3:40 Details on decentralized lending platforms. Compound DYDX and Maker. No KYC or custody with a decentralized governing system and variable rates.
4:00 THE GOOD REASONS TO LEND YOUR CRYPTO
4:10 The advantages of lending your crypto are things like great returns accessibility no credit reports required flexible terms low fees and relatively safe.
5:00 The bad elements of crypto lending to be aware of.
5:10 It is a young industry and it still has elements of the wild west
6:00 Not your keys not your coins
6:30 Check your rates carefully because sometimes they are not as juicy as advertised when you read the fine print.
7:00 These lending facilities are not FDIC insured
8:00 Interfaces are very complicated and many find them hard to use.
8:30 There are many stories of people shipping incompatible tokens resulting in loss of crypto forever.
9:00 Volatile market conditions can force shutdowns and some of these markets resulting in delays in accessing your crypto.
10:00 The ugly side of Crypto Lending
10:30 The industry has been plagued with many cases of bad actors i.e. founders running off with money for playing nefarious games.
11:00 Often these platforms use open source code which is vulnerable to bugs and hacks and lack scalability.
11:30 A summary list of some of the crypto lender hacks during the year 2020. Some of the names include bZx, Lendf.me, BlockFi, Balancer Protocol, Opyn, Sushi Swap, Eminence Finance, Harvest Finance, Akropolis, Value DeFi, Origin Protocol, Pickle Finance, Compounder, Nexus Mutual, Warp Finance, Cover Protocol
12:00 The PolonieX big margin loan loss of 1800 bitcoin case
12:45 Maker MakerDAO Flash crash loses millions of dollars for over 1000 customers
13:00 Conclusion
14:00 When in doubt zoom out
15:00 Conclusion number one the average bitcoin returns over the last five years is 594% average per year so why risk your crypto for an incremental half of 0.5% to 1% in total return. This assumes of course you get 3 to 6% return on your crypto.
16:00 Conclusion number two if you really need passive income what you should do and how you should operate and how do you should choose your platform based on your personal risk profile and your needs assessment. How to prepare for the risk.
17:00 Watch for scammers
18:00 Thank you all