I have spent the last 15 years navigating the traditional finance market, helping various clients across multiple industries and companies achieve laudable returns and providing recommendations to clients to help them make informed decisions. However, because the traditional finance market’s limitations are very frustrating and I was still not able to generate as much high returns as I believed I could, both for my clients and myself; I was on the lookout for new and better ways to improve my portfolio management strategies.
My quest to find the best investment strategies led me to discover the world of decentralized finance (DeFi) and DeFi protocols and I was greatly impressed with its potential. It has gone from an industry with a total value of $1 billion in 2019 to over $100 billion today and it is still growing.
I did my due diligence and researched different protocols, analyzing their potential risks and rewards. With this information, I was able to make informed investment decisions that have paid off. I have seen returns as high as 870% on my investments in less than a year using DeFi protocols, and I know that this kind of success is possible for anyone with the right knowledge and experience.
In this article, I will be throwing more light on this phenomenon and how it works.
What is DeFi?
When you hear the term DeFi, short for Decentralized Finance, it refers to a financial system that operates on a decentralized public blockchain network like Ethereum, Bitcoin, and others. DeFi platforms aim to create a transparent, open, and decentralized financial system that allows anyone to access financial services and products without the need for intermediaries (banks, brokers, wealth managers, etc.) regardless of their location or background. These services include lending, borrowing, trading, and investing.
For example, in the U.S., the Federal Reserve and Securities and Exchange Commission (SEC) define rules for centralized financial institutions like banks and brokerages, which consumers rely on to access capital and financial services directly. DeFi challenges this centralized financial system by empowering you with peer-to-peer digital exchanges.
DeFi platforms are built on the principles of transparency, accessibility, and decentralization, and are designed to provide a more efficient and cost-effective alternative to traditional financial services.
DeFi PROTOCOLS:
DeFi protocols are blockchain-based applications that allow users to access financial services such as borrowing, lending, trading, and investing. These protocols operate on a decentralized network of computers, which means that a central authority or company does not control them.
DeFi protocols are built on top of existing blockchain networks such as Ethereum, and they take advantage of both smart contracts (rules) and algorithms (active enforcement) to automate financial transactions. Smart contracts are self-executing programs that run on the blockchain and can automatically execute transactions when certain conditions are met. This means that smart contracts set the rules of DeFi engagement, while algorithms enact them.
THE IMPORTANCE OF DEFI PROTOCOLS:
DeFi protocols have several advantages over traditional financial systems. First, they are accessible to anyone with an internet connection and a compatible device. This means that you who do not have access to traditional financial services can use DeFi protocols to access financial services.
Second, DeFi protocols are more secure than traditional financial systems. Since they are built on blockchain technology, they are resistant to hacks and cyber-attacks. Additionally, smart contracts ensure that transactions are executed automatically and without intermediaries, reducing the risk of fraud and human error.
Third, DeFi protocols are transparent. Since they operate on a decentralized network, all transactions are publicly visible on the blockchain. This means that you can verify the integrity of transactions and ensure that you are not being defrauded.
Almost any centralized financial service or product could be replaced by decentralized protocols. We’re currently seeing this in lending and trading. For example, in the DeFi lending space, the protocol disintermediates the lender matching process, the risk management process, loan provisioning, and the ultimate transfer of value between parties.
In the investment management space, crypto tokens and blockchain-based algorithms are starting to replace the need for ETFs (Exchange Traded Funds), mutual funds—baskets of assets and equities—and even hedge funds, enabling lower fees and virtually no limitations in terms of access.
For example, suppose decentralized protocols/algorithms are applied. In that case, there doesn’t even need to be an intermediary manager, perhaps just a token derivative representing the individual stocks or assets, and a computer algorithm that rebalances and/or trades based on a set of rules or criteria. All of this happens automatically due to smart contracts (essentially self-executing programs that run on a blockchain).
Examples of DeFi Platforms & Protocols and the unique features they offer.
1️⃣ Compound – Compound is a decentralized lending platform that allows users to lend and borrow cryptocurrencies. The platform uses an algorithmic interest rate model that adjusts interest rates based on supply and demand, ensuring that borrowers and lenders always receive fair rates. The platform offers a user-friendly interface and provides instant access to funds.
2️⃣ Uniswap – Uniswap is a decentralized exchange that allows users to trade cryptocurrencies without the need for intermediaries. The platform uses an automated market-making algorithm that enables users to trade any ERC-20 token with greater efficiency, regardless of liquidity.
3️⃣ Balancer – Balancer is a decentralized exchange and liquidity provider that allows users to trade cryptocurrencies and create custom pools with multiple assets. The platform also offers liquidity mining and governance features.
4️⃣ Ehodler – Ehodler is a DeFi wallet that allows users to participate in algorithmic trading strategies to maximize their returns. The platform also offers lending pools, staking pools and cloud mining services, allowing users to earn interest on their cryptocurrency holdings by lending them to the platform’s lending pool, earn rewards for holding specific cryptocurrencies and participate in mining activities.
5️⃣ Yearn.finance – Yearn.finance is a decentralized yield aggregator that automatically allocates users’ funds to the most profitable DeFi protocols. The platform uses a unique governance token called YFI, which allows users to vote on changes to the platform. Yearn.finance is designed to simplify the process of yield farming, making it accessible to a wider audience.
6️⃣ Curve Finance – Curve Finance is a decentralized exchange (DEX) protocol that specializes in trading stablecoins. Curve Finance uses an automated market maker (AMM) system that provides users with low-slippage trades and high liquidity for stablecoin assets.
MY PERSONAL EXPERIENCE.
Each of these DeFi protocols and platforms I listed above are the ones that I have explored however the one DeFi platform that stood out among the rest was Ehodler. It stood out to me as a platform that offered something different and is revolutionary in the DeFi world for the unique features it offers that enable investors to easily manage their cryptocurrency portfolios and ensure it is safe and remains profitable.
Such features are; A semi-custodial cryptocurrency wallet that comes with 2FA authentication for added security which ensures it is hack-free and you are in full control of your funds and can access them at any time through your wallet dashboard. The security of your funds is ensured by 256 SHA smart contracts, which are highly secure and comparable to the security used by many financial institutions.
Its algorithm is based on probability computation and advanced statistical techniques which helps analyze market trends and predict price movements with a high degree of accuracy. This ensures that the protocols and trading strategies it offers are accurate, very low risk and profitable.
Ehodler provides a stablecoin equivalent of the underlying asset credited to your wallet, which allows you to start using their protocols immediately while the value of the underlying asset (such as Bitcoin) appreciates. This means you can benefit from both the increase in the value of the underlying asset and the profits generated by Ehodler’s protocols.
As an investor in the cryptocurrency market, it has helped me to consistently generate the high returns that I was looking for, and I am confident that it can do the same for you. Back in 2021, when I first utilized its DeFi protocols; Staking pools, Cloud mining and Algorithmic trading strategies, I was able to turn an experimental investment portfolio of $50,000 to $268,350 generating a 436% ROI in just 180 days. That was just the beginning and those results have not been a one-time occurrence.
I understand that even with this information I have provided, navigating the DeFi ecosystem can be a bit confusing especially when you are new to cryptocurrency investments but I believe it shouldn’t be. This is why I would be willing to help you create an investment portfolio schedule and strategy by using a portfolio builder questionnaire that takes into account your investment goals, timeline, budget and risk tolerance.
This would help you fully integrate DeFi protocols into your cryptocurrency investment portfolio in order to achieve your investment goals. To access this investment schedule, all you have to do is to fill out this form and I will personally be in touch and get back to you.
Follow the link provided above and take the first steps towards transforming your financial investments in order to build a very successful financial future for yourself. Together, let’s embark on this lucrative journey towards financial prosperity.
