How to profit from DEFI

Open News
3 min readOct 31, 2020

If you landed on this article and have no clue what DEFI is then I suggest you check out our previous article ‘WTF is DEFI’ before reading, otherwise read on. So as we mentioned in our previous article DEFI is an ecosystem of blockchain protocols offering decentralized financial services such as lending, staking, credit, etc. all fully based on crypto. There are various ways to profit from DEFI which we will cover below.

HODLing

The acronym HODL has been widespread in the crypto community and was popularized after an anonymous bitcoin investor posted in a Bitcoin forum in 2013 “I am Holding” (bitcoin) he meant to say “I am holding”, however, the term stuck. HODLer’s philosophy to profit from crypto is to hold crypto regardless of price action in the present and sell in the distant future (years). This literally just means buying crypto with money you don’t need now and letting it grow. You can buy crypto using any of the wallets or exchanges we mention in the footnotes.

Trading

Trading involves buying and selling crypto in a shorter time frame such as Months, weeks, or days in an attempt to profit from the price swings. Trading does have more risk than simply holding since prices are more erratic in the shorter term and subject to manipulation or external factors that may not be obvious at first sight. You can trade crypto using any of the exchanges we mention at the bottom of the page.

Lending

Lending crypto simply entails letting you crypto sit in any of the DEFI crypto pools we mention below and allowing your crypto to accrue interest, kind of like a savings account but with a higher yield.

Staking

Staking your crypto is similar to lending since on both occasions you receive interest for letting your money sit. Staking entails you leave your money in a staking pool (a pool of many peoples crypto) and allow your crypto to accrue interest. You can stake at any of the pools we mention below.

Liquidity aggregation

Liquidity aggregation is similar to lending and staking since you also receive interest for letting your money sit, think of it as another type of savings account. Liquidity aggregation quite simply entails you let your DEFI cryptos sit in a liquidity pool and be rewarded with a yield for doing so, however you are paid in the liquidity pools token which you can then exchange for crypto. You can add liquidity to any of the pools we mention below.

The app we are building at Open.

Our vision at Open has always been to make financial services accessible to everyone regardless of location or economic status, we are here to make financial services Open and decentralized, that's why we are building a DEFI aggregator, we are bundling all the above-mentioned services and more into a single app, this coupled with financial education through our platform will allow almost anyone to access crypto financial services, we are putting you back in control of your finances. Subscribe to our newsletter and telegram channel to be updated on the release of Open V1!

Services you can use to profit from DEFI

Wallets:

-Coinbase

-Trust wallet

-Jaxx

Lending pools:

-Aave

-Maker

-Fulcrum

Exchanges:

-Binance

-Kraken

-Coinbase

Staking pools:

Staked

Kraken (offer staking)

-Coinbase (offer staking)

--

--