DeFi (Decentralized Finance) has exploded in the crypto space over the last couple of years, and in 2021 alone, the industry was valued at just under 12 billion dollars. We caught up with Ox Bid, the COO of Bolide.fi, to find out her view of the industry development over the next few years.
What is DeFi?
Decentralized Finance (DeFi) - is an emerging self-custody financial technology that allows individuals to manage their finances independently of global institutional authorities.
Whilst using banks people have to go through a lot of different bureaucratic processes, pay multiple fees and wait for a transaction to go through, DeFi eliminates all of these borders. People can hold money in their digital wallets safely and make transactions in just a couple of minutes. All you need to use DeFi is the internet.
How does DeFi work?
DeFi uses blockchain technology. The information about transactions made by users is saved in blocks and verified. Once the transaction is verified, the block is encrypted. Then this block is linked to another block with all the information from the previous one. These blocks are chained together, forming a segment of a blockchain ecosystem. This ecosystem is essentially a substitution of all the intermediaries involved in financial transactions in TradFi.
What challenges do you see for DeFi in the short term?
Since DeFi is a new financial system, it is not yet well regulated, and currently, laws are grounded on the notion of separate financial jurisdictions. The borderless transaction ability of DeFi is probably the most challenging here. However, DeFi is constantly evolving, so once regulations across different jurisdictions are set, the possibilities for further growth are limitless. Another big challenge is the customer entrance level. Despite the fact that there is already a large number of different protocols, the market itself is still very difficult to understand for an average user, say online banks.
How can someone earn passive income through DeFi?
The potential to earn passive income through DeFi is endless, and it is a truly exciting opportunity for anyone, everywhere. Yield aggregators are one of the best options out there, simplifying the whole investment process and giving investors solid double-digit APYs.
The biggest advantage that the decentralized market gives us is the ability to fully own and earn on your own assets without the middleman. There are different types of DeFi protocols, ranging from landing protocols, where you can leave your assets as collateral and earn on the percentage of providing liquidity to other market participants, ending with farming, where you provide liquidity to trading pairs, namely farming pairs, and receive part of the trading commission - farm tokens on decentralized exchanges.
There are also other types of financial instruments, such as automated yield platforms, which make customers' lives easy and give stable and high rewards.
What are the main features of Yield aggregators? How do they work?
Yield aggregators are based on automated complex strategies. Most of such protocols optimize parts of the processes in farming by multiplying yield positions, automatically selling rewards, and re-adding them to the main liquidity pool. All of these actions help customers to save their time from constant market monitoring or a lot of different transactions, optimizing gas fees and increasing profits. I would say that this is probably the best way to manage your assets in the new financial world.
Can you tell us more about your company, Bolide? What has been behind your impressive growth and popularity?
Two years ago, together with my team, we got inspired by the idea of managing assets within the DeFi space and earning income solely from providing liquidity. Putting all of our efforts, knowledge, and ingenuity together, we created Bolide - a self-custody DeFi yield protocol, built on smart contracts. Bolide allows managing your crypto assets such as BTC, ETH, USDT, DAI, BUSD, USDC safely and easily. We also recently launched the Altcoin strategy which includes XRP, XVS, LTC, ADA, LINK, DOT, MATIC tokens.
As an algorithm-based protocol, Bolide applies automated strategies to work across the DeFi market and get the highest possible returns on crypto assets. All yield generated by our strategies pays back in native utility token #BLID, which you can easily claim any time and move under staking or exchange on DEXes, LBANK to any other token. Our average APY level is about 8% for most single crypto assets, the staking is around 20%.
We are working a lot on liquidation and impermanent loss risk control by constantly monitoring the token price and the liquidity level across the market and especially in protocols, which our strategy is leveraging.
We recently developed a cross-chain strategy which is at the moment under audit. This strategy will allow users to bring their assets to Bolide from Polygon, Ethereum and Avalanche blockchains without using bridges.
At Bolide we have a lot of plans and we really care about customers and the market itself. We are building relationships with all of the key market players and constantly supporting our community by doing different activities, giveaways and APY boosting.