After watching a few interviews with BlockFi[0], I come to understand:
There are probably hedge funds or other large institutions who want to trade USDC or BTC without owning it. I am not a professional investor, so I don't understand quite why they wouldn't just buy USDC or Bitcoin outright and trade it...
But, every market needs liquidity and you basically are providing it by lending out your assets. There are some protocols emerging which lets you keep ownership of your coins and still lending them out.
I would go to BlockFi or other 2-3 bigger institutions (maybe even Kraken or Coinbase) and lend USDC out for currently 10%.
I don't know about taxes much, it depends on the country. All crypto is tax free in Germany after 1 year, so people mostly hold for a year and sell.
I am lending out USDC because, well, where do I get 10%? Also, lending out BTC means you can still keeping it while profiting from it.
Few people here understand that people actually don't want to sell Bitcoin since it seems to be a hard asset, and you don't want to get rid of it. So you can profit from the gains on the BTC price WHILE ALSO profiting around 5% a year of it. It's like a dream.
I don't expect this to go on for ever, but the market needs liqudity and its a perfect time to do so.
Haven't I said? Inflation. Have you checked house prices or asset prices lately in terms of the balance sheet of the FED?
Bitcoin is the only asset which gave you a real return in the last, maybe 10 years. Even if indexed the NASDAQ or whatever, your real return was probably below 0.
You can copy paste a lot of definitions, that's great. Just tell me how your returns were and how you measure them. If you measure them in Dollars, then show me what your money buys you now versus what it bought you 10 years ago.
You can say I am hedging against the devaluation of FIAT currencies.
Haha, how so? Bitcoin is the only asset which outperformed everything else in the last 3 years. So yes, it is the ONLY (next to Housing and Gold, maybe - based on the numbers: Bitcoin also outperformed Gold) are the only hedges against inflation. Even if you went all-in FAANG, you barely kept your purchasing power.
Concentrated trades is how you get wealthy, spreading your bets is keeping your wealth.
But this is a once in a liftime chance. I can‘t believe people on a tech forum are so blind to the fact that we are in control for the first time. Hedge funds dump money into a system which they can‘t read or understand. It was the opposite for hundreds of years. The average Joe had to trust the financial world. Now YOU can read the code the money runs upon, all in the open.
So yes, show me how you did perform with your FIAT money in an age of money printing.
Your words were true up until 2008, everything after that: Throw away your old school investment books, they don‘t work anymore.
Work is about finding a meaningful way of living your life, of creating something or giving something you can be proud of. If you just do it for money, you already fell prey for the bad parts of human greed and status games. This has nothing to do with other people.
All you see is finance in the open. This happens, far worse, for so long. DeFi just makes it accessible for the average Joe and so you read about it on Reddit. Just like HackerNews can fuck your mind and think there is always a smarter person (there is), DeFi just shows there are always people making money easier than you.
There is a limit to money and happiness. Sure, if you want to be financial independet, stop working, get into DeFi, this is a rare once in a century opportunity to hold your hands open while hedge funds are pouring money into a new system.
Money or wealth won‘t make you happy. Family, friends and purposful „work“ does.
Got paid in Bitcoin for a year. Living in Europe, got a client in the US. Client had Bitcoin so it was faster, cheaper and easier to get paid directly in Bitcoin.
Obviously, no landlord accepts Bitcoin yet so I had to sell a portion for EUR.
Another obvious use case: If you change the denominator from USD to the FED balance sheet, the S&P just went sideways since 2008. So did everything else.
Bitcoin for me is an inflation hedge and I have all my wealth in the digital space at the moment. Bitcoin, Ethereum and Polkadot. I am simply waiting for StartUps to build more use cases around the space so I can safely stay there until I die.
So: Payment and escaping the destruction of FIAT money by the central banks.