3 reasons why the crypto community is turning to asset-backed yields

Volatility

Yield farming comes with a high degree of volatility. A lot of yield farmers tend to move their funds around to chase the best DeFi protocols that offer investors the highest percentage of return, also known as “crop rotation.” This has led and significantly contributed to the high volatility experienced in the industry.

Rug pulls

This is a type of exit scam where cryptocurrency developers gather investor funds for a project with the attention of abandoning the project without returning the funds to investors. According to a report by CipherTrace, 99% of major fraud in the last six months of 2020 were due to rug pulls and other exit scams.

Competition

Like with all budding industries, new DeFi protocols are constantly being introduced into the market. This means competition continues to grow. As a result, there is pressure on companies to release new contracts and features without the necessary audits and regulations in place. Sometimes protocols may mirror competitors, which leads us to our next point.

Fraud

According to a report by CipherTrace, fraud and misappropriation accounted for the majority of the $1.9 billion in crypto crime in 2020.

Reduced Risk

Asset-backed yields essentially mean investments are backed by tangible, physical assets.

Diversification

Asset-backed yields are able to provide exposure to real-world assets, allowing investors to diversify their investment portfolios. With tokenisation, Bricktrade can provide investors with the choice to participate in opportunities across the globe, seamlessly and at a nominal cost.

Transparency

Platforms such as Bricktrade provide investors ease with the technology to track investment performance in real-time whilst ensuring the safety of asset-backed yields with the company’s very own blockchain technology. Investors will be able to take on new investment opportunities that are expected to yield higher returns, with reduced anxiety in comparison to yield farming.

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