Putting your Ethereum to Work: Try these 4 ‘De-Fi’ Apps06.04.2020, 11:47
With ‘De-Fi’ (decentralised finance) continuing to push the boundaries of traditional finance - and with Coinbase wallet just recently adding support - let’s take a look at where and how you can test the waters.
If you’re familiar with Ethereum, the decentralised network of web3, then you’ll be familiar with MetaMask. We’ve covered this in previous posts here at GrabFreeMoney.com. It’s one of the vital browser extensions or mobile wallets that open up an extra world of monetized dapps, acting as both a crypto wallet and a login interface for making transactions. This might include buying and selling art or ‘crypto-collectibles’ on sites like Opensea. This might include borrowing more crypto with it (managing a CDP), saving it up as a stablecoin, or trading it on a dex (decentralised exchange). Interest rates you can earn with cryptos are now far more attractive than with banks.
It doesn’t take long to set up your own MetaMask wallet, load it with Ethereum and then begin accessing various dapps, or just paying friends or doing giveaways. Not only does it store Ether, but a host of tokens that do different things in different dapps or sites.
When you’re all set up with your own MetaMask account and personal public address (remember to store carefully your private key and password) then you’ll be able to log-in to some exciting dapps, including the following.
[Note: It’s a good idea to always keep some Ether in your wallet, for gas fee purposes. See also the ‘note about risk’ at the bottom of this post.]
KyberSwap: Swap any Ethereum Token Easily
At KyberSwap.com, you can swap Ether instantly for any top trending token quickly and easily. They’ve focused on security and speed, and low fees. You can also transfer tokens to addresses and place limit orders.
Log-in via MetaMask and your Ether and existing tokens will automatically be detected. Funds remain securely in your wallet until the trade is actually executed.
Perhaps you’re interested in investing quickly in Chainlink (LINK), iExec (RLC) or Unibright (UBT)? Perhaps you’re worried about current volatility and potential market swings (with Coronavirus) and would prefer to jump out of Ethereum into stablecoin DAI for the time being? This is easily done at KyberNetwork, where its native token KNC gives you even more of a discount on fees. Now listed on Coinbase, holding this token could also prove a good investment, with options for staking them for more, on the way.
Open and Manage a CDP
The Oasis dapp mainly manages 3 activities, all under one roof: Saving, Borrowing (via CDP) or Trading.
Principally, it allows anyone to take out a MakerDAO CDP (Collateralized Debt Position), most likely for ‘going long’ on Ethereum. You lock up your Ethereum, in order to borrow DAI, with which you can either buy other cryptos (in the Trade section) or more Ether (when price is low). [See another dapp - DefiSaver - below, for even more features].
Saving: If you’d rather not ride through volatile times, you might prefer to swap all your Ethereum for DAI stablecoin and lock this up into the DSR (Dai Savings Rate). You can swap Ether for DAI instantly in the Trade section (or buy DAI directly via Coinbase), or you have the option of using Oasis market DEX (decentralised exchange) if you’re familiar with trading.
Who’s responsible for the decisions and adjustments to the Maker protocol behind these features? The community now is, or the DAO (Decentralised Autonomous Organisation). Those with more Maker (MKR) tokens get to have more weight when voting on key upgrades.
DefiSaver: Your ‘De-Fi’ Dashboard
DefiSaver.com manages the same activities as Oasis, but it goes a step further. You can log-in once again with MetaMask, and you will see any activity you might already have started with Oasis already (since both apps are interacting with information and contracts on the Ethereum blockchain).
There are some extra features which will allow you to manage your CDP (including automate your CDP) and savings, across multiple different apps.
The dashboard is well-designed with constant improvements and de-fi adaptations.
PoolTogether: The ‘No-loss’ Lottery
Lastly, for a bit of fun, you could try out the simple but revolutionary ‘no-loss lottery’ de-fi dapp at PoolTogether.com.
The money from your ticket goes into an interest-earning account (via secure smart contract). At the end of the pool, even if you don’t win the prize, you still get your money back. However, you could also be the one lucky person who wins the interest on the all money saved for that period.
So a lottery game becomes a savings game, encouraging people globally to save their money? It’s a new idea now possible via crypto and de-fi.
Logging in to the app is quick and easy via your MetaMask extension.
You’ll need either DAI or USDC stablecoin to buy your tickets (convertible from Ether easily and for free at Coinbase or Kyberswap).
A note about Risk
The above dapps (interacting via Smart Contracts to the Ethereum blockchain) are a part of the emerging ‘De-Fi’ or ‘Decentralised Finance’ buzz. Your assets remain under your control, since you have the keys, and they connect without any risk to your assets. They are decentralised since Ethereum is highly decentralised and secure. However: this doesn’t mean that the dapps themselves are risk free. You should never invest everything you have, but perhaps enough to experiment with, for now. ‘De-Fi’, although growing rapidly, is still subject to possible attacks or unpredictable issues. However, is anything completely risk free with financial products, or market events and traditional banks? With no intermediaries involved, and a committed (involved) community voting on MakerDAO CDP decisions, via the MKR token, you could also argue the opposite.