How to profit from the high hopes of Decentralized finance (DeFi) (2024)

There is no denying that the current traditional financial system has had a run for its money this year. The technological advancement made in blockchain and cryptocurrency has changed the face of the financial industry totally from what we know it to be.

While in previous years, individuals were at the mercy of the traditional financial institutions that had a monopoly on borrowing and lending terms, transactions between individuals, organizations and even investment opportunities. All of this has changed with the newly available alternative to the current system: Decentralized Finance, more commonly known by its short form DeFi.

What is DeFi?

DeFi is a financial system that seeks to provide an alternative to the traditional financial system. With DeFi, users have access to an avalanche of financial applications in cryptocurrency and blockchain that are aimed towards removing the need for financial intermediaries like banks, exchanges, and so on.

Instead, DeFi makes use of smart contracts that are mostly built on Ethereum blockchain and avoid those intermediaries. Many DeFi platforms are able to perform the traditional services being offered by the central bodies. There are DeFi platforms that allow their users to be able to lend or borrow funds from others, some DeFi platform on the other hand allows their users to be able to speculate on price movements on a range of assets using derivatives, while some allow users to trade cryptocurrencies, and some insure users against risks. However, what they all have in common is that they offer solutions to customers’ pain points in a decentralized way.

DeFi removes the regulatory burdens that usually come with the traditional financial system, it also better protects its users from bearing risks of losing their funds which some traditional financial institutions’ risk appetite, errors, and frauds could lead to.

But let’s face it, so far most Defi projects out there still do not live up to users’ hopes. The good news is however that there are companies like Nimbus which already has 50,000 users on board and provides tangible solutions to users.

Making DeFi a Reality

Nimbus is an established fintech company that is launching a holistic DeFi platform serving as a bridge between the traditional financial system and DeFi. Once launched on January 27th, the platform will be combining the best practices in the traditional financial system with decentralized finance to address the pain points of those seeking access to financial services.

Nimbus gives up to 10 different earning strategies for their users. With use cases in IPO investment, Startup Financing, Peer-to-Peer loans and other options, Nimbus users get an opportunity to diversify their investment portfolios and leverage their crypto in unprecedented, profitable ways.

As a first stage towards this new vision, Nimbus is launching NBU, its native token that provides access to all of these revenue-generation tools. With its second, Governance token launch slated for this winter, users can also go about governing the platform, its technical development, dApps profitability levels etc and earn their shares of Platform revenues.

Essentially, DeFi creates an infrastructure where users can replace whatever shortcomings that the traditional financial system might have foisted on them by democratizing the financial system.

How can users maximise DeFi potentials

The DeFi industry is already revolutionizing how the financial market operates but it feels like we are barely scratching the surface with the limitless opportunities that could be available to every user.

Using Nimbus as an example again, their DeFi platform affords users a level of opportunity that is currently unmatched in the traditional market. The combination of the traditional financial system and DeFi lets the Fintech company produce financial products that were thought to be only accessible to institutional investors.

One of such ways Nimbus ecosystem would operate is allowing multiple DApps to operate on its platform. These DApps can be used for a different purpose. They can be used to access P2P loans to IPOs and even startup financing via convertible notes and equity.

All of this is done using the native token NBU. NBU serves as the access key through which Nimbus users would be able to participate in over 10 different pools with different profitability levels.. And the best thing is, all of this is possible via one single ecosystem.

On the broader scale, we look at how users in other DeFi platforms can maximise the features available there for their personal use and investment plans:

Risk is better managed especially through Decentralization and Automation.

In DeFi, users have complete control over their assets. This means that a user knows where and how his funds would be utilized if he chooses to invest in such fields.

In DeFi, protocols cannot invest in any risky market without the express approval of the user. As such, an investor can decide against investing in certain risky markets because of its volatility or any other reason that might be best known to him.

So, investing in any financial product is always at the sole discretion of the investor who has complete access to all the required data that can guide his decision making process.

DeFi is not subject to any central authority

No government regulations or laws can stop a user from accessing his funds. This is almost impossible with the traditional financial system where the financial institutions are always subject to the regulations guarding their operations in each country.

A thousand and one way to keep earning profit

DeFi offers multiple income earning streams for all of their users. And the catch here is that users can keep earning all of these profits while they are still holding on to their crypto assets.

Earning profits in the traditional finance industry would require loads of regulations and also an enormous level of requirements. This can put so many off which at the end would lead to them disposing off their funds or investment instead of holding on to it. This is impossible in DeFi solutions as they are based on smart contracts and no one entity has control over it, even the government.

Opportunity to become a shareholder

Remember we said that DeFi democratizes the financial industry. This is particularly done through the decentralized autonomous organizations (DAO) that allows each user to become a potential shareholder on the DeFi platform.

This DAO allows the users to have a voice when it comes to how the DeFi platform operates and grows overtime. Moreover, many DeFi projects incentivize this participation by also sharing the revenue made through Platform among its governance token holders.

In conclusion, DeFi offers a level of freedom that is not possible with the traditional financial system. It also offers a level of profit that the traditional system will struggle to match.

And while the DeFi sector is still evolving, we are happy that holistic platforms like Nimbus already exist in the space and offer some proven yet unique opportunities no coming users should miss. Hopefully, as Nimbus launches its governance token and more dApps this winter, even more similar projects will follow their example and DeFi will finally receive the adoption it deserves.

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