- May 31, 2020
Can you link me exactly what the offer his?Can you explain how the 7-8% APR is sustainable?
Cosmos is a proof of stake chain, which is basically a network ran by a bunch of validators who stake their tokens to be part of the validation and get rewards for it. Cosmos has an inflation-rate of 7-12%, meaning the supply will grow 7-12%. By staking your tokens, you earn a portion of those rewards. Dollar-wise that sustainability is dependable of buying pressure and/or token appreciation that is dependable of many other factors. But most of defi apr actually comes from lousy traders lol, anyone selling you on long-term sustainability of high apr%s is scamming you.
But defi isn't that. Defi is decentralized finance. Permissionless on-chain financial operations like trading futures, options, borrowing, lending, synthetic assets, stablecoins, algorithmic stable coins, etc. all executed on chain (mostly ethereum, and preferably, through chainlink oracles). You should 100% get acquainted (as in, read, study, learn, etc.) with this world as it is fostering hyperbolic innovation in how we can actually control, manage and trade financial assets.