Earn rates as high as 23.61% on your cryptocurrency?!
Growth of principal has long been one of the most exciting benefits when buying crypto assets, but as the industry has evolved, obtaining attractive yields is emerging as a new opportunity.
Traders and investors can now earn on their portfolio through lending and derivatives, not to mention the many decentralized finance platforms offering rewards in exotic crypto assets.
Whether you are a long-term HODLer or you’re looking for new ways to grow your savings, we think you will find our latest Kraken Intelligence report insightful for your earning potential.
Interest rates or rewards on crypto now exceed the majority of rates you can earn on traditional financial products, but that opportunity comes with risk.
In this first report in our crypto yields series, Kraken Intelligence provides an introduction to the many available yield-bearing products. We analyze how each one works, what benefits they offer and the associated risks to help you decide which offerings best fit your needs.
- Decentralized Finance – Lending and market making are two of the most exciting services currently offered in the growing DeFi sector. Participants in liquidity pools are rewarded with fees charged to traders in the pool, while lending works similarly to traditional financial tools. However, the yield return can be volatile.
- Derivatives – “The longs pay the shorts and the shorts pay the longs.” That phrase sums up simply how yield payments reward futures contract holders, yet more complex situations may arise. Our report explains contango and backwardation situations and how traders will try to capture this “cost of carry.”
- Risk-Free Rates – The foundational interest rate is called the risk-free rate, which is the yield associated with what is perceived as a guaranteed future payment. We explain how the monetary policies and programming of Bitcoin and cryptocurrencies work, and how they compare to this standard.
- Staking – Proof-of-stake networks offer rewards on cryptocurrency locked in special contracts used for securing a blockchain. This means that some crypto assets allow you to receive newly minted coins and transaction fees, just for staking. In our report, we examine the coins that can provide earnings, how much they offer and the different factors that lead to a staking reward.