The crypto market witnessed a great fall in May, especially in TerraLuna,
that led to investors pulling out billions from the crypto market,
causing it to be stuck in a bearish phase. In this bearish phase, passive income is
becoming a popular choice among investors. Auto staking and Auto compounding protocols
are making waves in the crypto market. Before diving into this, here is your regular reminder
to be cautious with cryptos since the market is highly volatile and the dynamics can change.
Now let us understand what is an Auto Staking and Auto Compounding Protocol in Crypto?
The Decentralized finance space is growing along with cryptocurrencies
and is becoming popular among investors
seeking high rewards. One such example is Auto staking and Auto compounding protocol.
It is a simple act of buying and holding crypto that can earn clients Rebase tokens as interest
payments. The reward payments are directly credited into the individual's wallet. After
every 30 minutes, the Rebase tokens are added to client wallets, keeping the inventories updated.
These protocols are built on the BNB chain that aims to maximize the profit gained by token
holders by both supply and treasury growth. There is a buying and selling fee, which depends on the
developer. On average, most of these protocols levy 15% buying tax and 16-18% selling tax.
Many firms create utilities for the token to avoid heavy fluctuations,
and many don't. These protocols are Devised and administered by a group
of smart contract developers, community managers, and marketing specialists.
What's the catch with these Auto Staking and Auto Compounding Protocols?
As I said earlier, these protocols give high rewards, but there is an increased risk. The
protocol's token remains unparalleled with an extremely high Annual Percentage Yield
that can be between thousands and millions. The simple act of buying and holding crypto
can earn clients protocol-specific tokens as interest payments. The reward payments are
directly credited into the individual's wallet. After every 30 minutes, the protocol tokens are
added to client wallets, keeping the inventories updated. The rewards are derived from the tax
collected from transactions and other various ways. Some adopt the merchandising strategy
to bring in more revenue, and some might build a Decentralized Exchange.
Which Protocols are popular among investors?
Last year in November 2021, Titano Finance launched its protocol with an Annual Percentage
Yield of 102,483%, which is mammoth. Other examples are Libero Finance with 150,520%
Annual Percentage Yield, Sphere Finance with 99,985% Annual Percentage Yield, Safuu with
383,025% Annual Percentage Yield, EverSafu with 385,945%, Petoverse with 2,087,120.50%,
which are similar in their tokenomics but may offer different utilities too. ( For gfx editor-
I'm attaching links of these companies that are marked in red please put their Logo put it over
the voice of the anchor making these companies display one by one along with their APY%)
Now, to sum it up and address a question triggering your mind.
Are these projects sustainable as they offer a very high Annual Percentage Yield?
To answer that is difficult; one must be prolific in reading whitepapers of these protocol companies
on their websites and then assess them before deciding to invest in these protocols
like the crypto market, which is prone to high volatility.