It is no secret that generating passive income is one of the best ways to build wealth and achieve financial independence. With the rise of Decentralized Finance (or DeFi), there are now various unique ways to generate passive income using blockchain technology. Earnity, led by executives Dan Schatt and Domenic Carosa, seeks to help people gain access to DeFi products and protocols that will help them achieve financial sovereignty and independence.
There are three common methods that one can employ to generate passive income with DeFi:
Staking: This method is the process of locking, or “staking,” tokens into a smart contract, letting the owner earn more of the same token in time. Staking supports a cryptocurrency platform, as the locked coins are put to work by blockchain technology and contribute to the network’s security and decentralization. Think of it as an interest-bearing savings account.
Lending: Like staking, lending involves locking digital assets into a smart contract. The difference is that it is managed by lending platforms, which utilize the loaned tokens and provide incentives to the lender as a reward.
Becoming a Liquidity Provider: Also known as market makers, liquidity providers are buyers who place and lock their tokens into a liquidity pool. Decentralized exchanges then use the pooled tokens to allow the swapping between two different cryptocurrencies. Any time a trade is consummated using that pool, a liquidity provider earns revenue or reward.
Earning passive income with DeFi is no easy task. It requires comprehensive awareness of various topics, including automated market makers and blockchain technology. Earnity’s Domenic Carosa and Dan Schatt understand that learning about DeFi and crypto is challenging to achieve, especially with the abundance of noise surrounding the emerging technologies on the social web. For this reason, Earnity intends to launch a platform where users can freely learn from one another and receive quality information about DeFi and crypto.
