Real Yield And Ponzi Yield In DeFi. Where Does The Money Come From?
In DeFi, the most important question is not What is the APR?, but Where does the yield come from?. šø Ponzi Yield the project pays yield using its own newly printed tokens. You stake Token A to earn more Token A at 100% APR. If there are no new buyers, Token A price will drop faster than the interest rate due to inflation. Your actual value evaporates even though your token count increases. šø Real Yield from the Revenue Sharing mechanism The project pays yield from actual revenue generated by service fees. Yield is usually paid in Hard Assets like ETH, USDC, or USDT.This model is sustainable because it doesn't rely on the project's token price but on whether people actually use the product. š¹ In a Bull market, Ponzi Yield can make you rich quickly due to FOMO. But in a Bear market, only Real Yield will keep your portfolio alive.
Are you earning yield from the protocol actual business profits, or are you just receiving worthless printed paper? News is for reference, not investment advice. Please read carefully before making a decision.
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content.Ā See T&Cs.
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