How are these returns even possible?
Last updated
Last updated
Great question!
We understand how they may seem farfetched or even crazy at first glance, but we encourage to invest a few minutes in educating yourself about this market before dismissing it.
Please read our How it works guide for an in-depth answer to your question
In general, it's simply because of supply and demand.
There are millions of people trading crypto every single day that use decentralized exchanges, like Uniswap, to move money between assets.
There are far fewer people providing liquidity (as market makers) to Uniswap to help these trades happen.
Because of this, the fees generated by traders are much higher since demand outpaces supply. You receive part of these fees in return for lending your crypto to the market.
Think of it like credit card interest rates, but reversed.
You're now the bank lending money to others earning 20-30% sometimes even more.
