Or the risk will show up, and people will lose a lot of money, and no longer trust DeFi.txhill wrote: ↑Wed May 05, 2021 11:02 pmSo I should clarify that right now, DeFi is early--I don't trust it with more than a really small % of my funds (and I don't really keep much in cash anyway). But that is going to change over time. It'll either get insured because the government will just accept that this is the way things are going to be, or it'll get so reliable over time that concerns about its stability will fade away.SlowMovingInvestor wrote: ↑Wed May 05, 2021 10:59 pm No, I'm not. Banks are not making 8% on what I deposit with them, I know their loan rates for mortgage loans. If I were so minded I would try P2P or real estate lending myself, cutting out the middleman, but I'm not,
And I do have a BlockFi account which earns 8.6%. But that's NOT where I want my cash to be - an non FDIC account that is collateralized by volatile, risky assets . That BlockFi account is what I consider part of my high yield bond allocation, NOT my cash.
I transfer internationally with Transferwise. It's pretty fast, very cheap, excellent forex. Not instant, but I like the fact that they do verification. Domestic wires via my banks are free, and their limits are fairly high. If I wanted to transfer more than that, I'd probably get a higher limit set up.
There is no free lunch. DeFi can only pay 8% because they are making loans at a much higher rate, and people who borrow at a higher rate are bad credit risks. (As far as I can tell, most of the people getting those high priced loans are using it to speculate in MORE crypto).
It really is dangerous.
It doesn't take that much experience and wisdom to spot this.
There is no risk-free 8%. There is no risk-free 8%.
It does seem you see that... Because like you say, you only trust it with a really small % of your funds...
So stop talking about how the 8% is such a good deal compared to banks. Because even you know it's not. Even you know there's risk there that doesn't exist with banks.