How Decentralized Finance Can Help You Chip Down the Road to Retirement
Author: Jason Dookeran
When your twenty-something-year-old bredren come to tell you he take out a life insurance policy, ah sure you laugh at him. You probably tell him something about retirement is old people t’ing.
It might seem so, but the reality is that retirement isn’t just for the aged. In North America, for instance, retirees work well into their old age because they can’t afford to quit. And, beyond grinding it out at work, it’s common knowledge that some of the best-earning potential you can get comes from stocks.
Unfortunately, though, Caribbean people typically have a hard time making sufficient financial headway in these departments. Enter: Decentralized finance (De-Fi) which offers people like us a way to invest our savings. 🎉
Retirement and Investment
Let’s be honest here, at 0.1% interest on a savings account, you could make better money selling pholourie on the side of the road. Alternatively, here are several ways that a person can generate income from their cryptocurrency holdings:
- Lending: In this scenario, you operate like a bank, 🏦 with a decentralized autonomous organisation (DAO) arranging loans between you and the borrower. You earn interest on those loans.
- Staking: Some chains allow for staking your currency – pooling it into an untouchable reserve that gives you the rights to mine more currency by verifying transactions on the chain.
- Adding Liquidity: Swaps are online locations where people go to exchange one type of token for another. If you offer both types of tokens to the swap pool, you can earn every time someone performs a swap on the site.
Earlier in this series, we went more in-depth into staking and yield farming. Check out those articles to get more acquainted with how earning money works through this method. 🤓 💡
Now, it won’t necessarily be easy to figure out what assets are worth investing in. In decentralized finance, values change rapidly. However, with a solid foundation, you could have more than enough money to retire.
Retirement isn’t a question of how old you are, but rather a question of when you can afford to stop working. Through compounding your investment and allowing you to reinvest your earnings, de-fi makes it easier to slowly but consistently replace your income with crypto-currency earnings.
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