> deposit it into a smart contract that then issues you a loan in eg stable coins (DAI, USDT), with your crypto locked as collateral.
Makes sense in theory, but are people actually doing this? Can you point us to more info about it?
Makes sense in theory, but are people actually doing this? Can you point us to more info about it?
Lock up ethereum -> borrow dai against it -> lend dai out and earn interest on it, withdraw whenever you want.
There are more complex yield farming strategies to get the best rates on your assets, leveraging them through debt positions and lending. There are pools to automate this like yearn.
There are now sites like alchemix where you can lock up your collateral into a lending pool, borrow against it, and the yield on the locked collateral pays off the borrowed debt position. Self-repaying loans!
Multiple times over the past year I have locked eth, taken $s to pay rent/buy stuff. Then come back later paid back the owed $ and get my eth back.
https://defipulse.com tracks the value locked in different protocols, it was less about $0.5 billion this time last year, now over $40 billion.
https://compound.finance/ https://oasis.app https://yearn.finance https://aave.com
It's interesting to watch the progression of DeFi projects as they're being developed. Being an early adopter in experimental financial technologies has its own set of risks, but at least these risks don't affect non-participants.
This is one such example of an 8-figure credit line using 4.5k worth of Bitcoin: https://defiexplore.com/cdp/9167.
In case it wasn't clear, DAI is a stablecoin, 1DAI=1$.