part 2 is to put your DAI to work in yield farms, then spend the yield your DAI makes for you. this way, you always have your collateral available in case the price starts dropping suddenly.
Just answering my own question here for any newbies who see this and are confused: I think with makerDAO, the objective is to use it like margin with stocks: i.e. to leverage your crypto to build an even bigger crypto position at a relatively low rate during bull runs vs BlockFi and Celsius, which are more like traditional savings accounts. Yes, the 8-12% monthly yield with BlockFi Pro might seem nice against the 3% loan rate at MakerDao, but with MakerDao, you are investing the "loan" right back into crypto, which could do 10x in 1-3 years. Plus I'm getting the sense that a lot of guys are sticking to decentralised platforms. If I have misunderstood this, please feel free to correct me. I'm still learning myself!
part 2 is to put your DAI to work in yield farms, then spend the yield your DAI makes for you. this way, you always have your collateral available in case the price starts dropping suddenly.
But why take a "loan" with makerDAO when u can earn interest with Celsius, etc.? sorry if this is a stupid question, I'm still learning!
Just answering my own question here for any newbies who see this and are confused: I think with makerDAO, the objective is to use it like margin with stocks: i.e. to leverage your crypto to build an even bigger crypto position at a relatively low rate during bull runs vs BlockFi and Celsius, which are more like traditional savings accounts. Yes, the 8-12% monthly yield with BlockFi Pro might seem nice against the 3% loan rate at MakerDao, but with MakerDao, you are investing the "loan" right back into crypto, which could do 10x in 1-3 years. Plus I'm getting the sense that a lot of guys are sticking to decentralised platforms. If I have misunderstood this, please feel free to correct me. I'm still learning myself!
I learned something today. It's a great day. Thank brother
Interesting!
Thanks for the info! Can you create a post on yield farms? thank you!
I'm curious what percentage of these loans defaulted? great article