1. Investors love certainty and hate volatility. The stock market offers uncertainty and volatility and hence it wrecks investors’ minds all the time.
2. Some investors who couldn’t take stock market risks would resort to fixed deposits or endowment plans or triple-A rated bonds to get guaranteed interest rates and principal protection. The downside is that the interests are usually paltry, less than 4%.
3. What if there is a USD-like deposit where you can earn a guaranteed 19% interest?
4. Investment products with the promise of low-risk and high-return are often scams but such returns are pretty commonplace in the crypto world.
5. Increasingly, more people are aware of the Anchor Protocol where you deposit UST (a stablecoin that fluctuates with USD) and get around 19% interest per annum. It is amazing because you get stock market returns with USD stability!
6. It is unheard of in the real world where your USD deposit is probably earning less than 1% per annum.
7. How can a USD-like stablecoin offers such a high yield? Is it sustainable?
8. The Anchor Protocol works just like how a bank operates. It takes your deposit in UST and lend it out to borrowers. Often the interests charged on these loans are way higher than 20%. Again this is normal in the crypto world, as the borrowers can get even higher returns elsewhere. Everything in crypto is amplified.
9. You will need some basic understanding of crypto wallet operations to get this going but it isn’t difficult. You need to get hold of UST and thereafter deposit it with your Terra Station Wallet onto the Anchor Protocol.
10. You can see the interest trickling into your account every few seconds. Talk about instant gratification. Meanwhile you know that no matter how volatile the crypto market is, your deposit is pegged to USD movements so you can sleep well at night.
11. Shouldn’t everyone get on it since this is a better deal than many other investments?! As with anything crypto, I tend to be more cautious because we really do not know what may happen. My stance is to put some money in it but not too much.
12. I asked my wife what she wants for Christmas. She told me a gold bar would be nice. I counter-offer her with crypto and she said okay. I am probably going to give this UST deposit to her and the bigger gift is in introducing her to a brave new world.
