Ethereum: The Last Bastion for Yield

Ethereum: The Last Bastion for Yield

(Ella Baxter/Unsplash)

In the legacy financial world, yield has dried up. Yields on U.S. Treasury bonds have never been lower. return. At around 2.1%-2.3%, AAA corporate bonds aren’t doing a whole lot better.

Knowing this, while also hearing about the Federal Reserve’s strong intentions to get inflation above 2%, it’s no wonder investors are ditching low-yielding assets and getting into more speculative investments. People are allocating capital in increasingly distorted ways. How else are they going to get a return? 

On Ethereum it’s difficult to avoid yield. Yield is the default incentive for successful decentralized finance (DeFi) applications to attract capital. 

At the most basic level, borrowing and lending applications like Compound and Aave are offering 4.6% and 6.2% interest, respectively, on deposited . More sophisticated yield aggregators like Yearn are generating 7.8% in their basic yield strategies, and up to 16% in more aggressive strategies. 

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