Is staking crypto the new "Savings Account"?

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Celsius, Youhodler, Nexo,...

The number of platforms in which you can stake cryptocurrencies, and earn an interest is becoming bigger and bigger by the day. The most of these platforms work with loans, in which you are the credit provider, and the network takes a cut of the interest. Some work differently, but that is not the point of this post. Are these the new savings accounts?

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I think they are, or at least they will become as popular. We all know the days in which a savings account brought people interest, and that interest used to be quite substantial, it used to beat the inflation. I remember having a savings account around 2005 that brought me 4.5 % interest per year. That was a good deal, as the money was always available for withdrawal, and it still brought me a reward. But those days are long gone. The quantitative easing and zero interest rate policies of the world's biggest central banks have killed the savings account. And people are losing money when they deposit it on a savings account.

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The crypto future

And that is why I think this will be the reason why crypto is going to become completely mainstream. Not the anonimity of transactions, not the decentralisation, but because it brings them return, and besides bonds and stocks, there is no alternative. Gold and silver, stocks, all have the downside risks of dropping value, but no real certain returns. Dividends can be halted in the case of stocks, and gold and silver have no real return, if it doesn't rise in value. Crypto platforms with peer to peer lending, bring immediate returns daily, and the possibility of withdrawal at the same time.

Not your keys, not your crypto

But there is a downside, like there is with banks. When you deposit your crypto at such platform, there is no guarantee you will get it back it they go rogue or bankrupt. Just like there is with banks. So beware, do your due diligence before you deposit your coins somewhere!

Sincerely,

Pele23

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11 comments
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@pele23, In my opinion yes, in a way we can call this age as, Age Of Digital And Virtual Financial System. Stay blessed.

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Did you ever lose money with bank?

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You lose money every day in the bank, due to inflation...

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That was not my point. I'm using bank accounts for 40 years and they never steal or refuse my withdrawals. They offering service and we free to use it or not. You shouldn't keep money in the bank for saving purposes in the first place. There're many more suitable and profitable vehicles for doing that.
Oh and don't school me on inflation, fees, and middleman, please. Every crypto has that as well.

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Believe me, I am not trying to school you, I just answered your question! 😎

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I think you may be right.

Aside from the "not your keys, not your crypto" issue, staking crypto works pretty well as a savings plan. Consider this... when you have fiat savings in a bank savings account, it's very easy to just make a quick transfer because you need to buy something. When you have those funds in staked crypto, it takes a little more work and time to get your hands on that money. As such, it's a more effective savings tool.

It'll be interesting to see how PayPal's entry into the cryptosphere will impact things... suddenly you have a way to hold crypto that half the people on the planet have easy access to. And let's not forget that PayPal is not stranger to "disruptive financial approaches:" After all, they disrupted the banking system by popularizing the idea of "Non-bank peer to peer money transfer."

As an only slightly related aside, I consider my stakes tokens here to be a savings account of sorts.

=^..^=

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Crypto is still in its early times and I believe that quite many might go bankrupt and people end up loosing money. I am curious though how you can get crypto loans.

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I use YouHodler, works like a charm!

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Yes, the new sovereign bank account. You're absolutely right IMO. We know blockchain tech slashes a lot of the typical overhead expenses that come along with financial instruments so there is a lot more pie to split up. But like you said there is a lot more risk that comes along with this level of autonomy.

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Long term savings in banks didn't have a sense at all, like never... What have we done in the past, while there were interest rates? We would save USD/EUR, or whatever else fiat currency, and got 3-4% yearly for doing that... Inflation was ALWAYS or the same or larger... Of course, it wasn't presented to us like that, but all of us felt the real inflation rate on our skin...

Crypto has sense as there are no additional printing, inflation is limited (for some coins), and there are no "hidden surprises"... Just my 2c



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Hello brother, the money (FIAT) that you lose due to inflation or devaluation of the same, you will lose it so you keep it in a safe, under the mattress or if you deposit it in a bank attracted by some type of pyrrhic interest that at the end of the year it's worth nothing.

These platforms that offer DEFI products, on the other hand, give you the opportunity to establish the interests that you want to earn for your bet, since it is up to the borrower to choose between the offers that are listed.

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