My experience with DEFI at SmartBCH

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Avatar for Jnavedan
Written by
2 years ago
In community: Cryptocurrency and Blockchain(7b7f)
Topics: SmartBCH, Earn crypto, Economy, BCH, DEX, ...

Three weeks ago, I formally entered the DEFI world after reading an article by @Pantera about Müesliswap, the newest DEX on SmartBCH.

Source: Image by Ekaterina Ershova on Pixabay 

Before continuing with the article, I want to clarify for you, who reads me, what DYOR should do before diving into the suggestive waters of decentralized finance. Here, I only want to tell you about my short-lived experience with my modest trial investment.

I will ignore the steps that you must previously perform to operate on SmartBCH. First, opening a wallet in Metamask, the configuration to deposit funds in SEP20, and thus be able to invest in the DEX of your choice. I think, in read.cash, there are excellent tutorials on this.

You noticed, from the start, some terms and acronyms abound in the slang of cryptos that you must handle, at least, to be aware of where you are.

I don't know about you! At first, I thought they were speaking to me in a complicated, alien language. Nothing could be further from the truth, if only if you do the corresponding DYOR.

After reading briefly, let me tell you! Very briefly, some good articles. I added funds in the Metamask wallet on the SmartBCH network through the newly created Wagon.Cash bridge between BCH and the sidechain.

Until then, everything seemed simple, but when I wanted to enter an option to get the extravagant rate of return, APR or APY, I had my first stumbling block.

The first thing I did, was to acquire the token of the DEX with the total of BCH involved. Oops! First error.

Imagine my face of frustration when I wanted to enter a Farm and couldn't. If I had researched how token pairs work earlier, I wouldn't feel such an idiot today. Well, idiocy abounds, and one does not escape it. LOL.

Source: Image by Orlandow on Pixabay 

I even entered the comment thread of one of the excellent articles on @Pantera to ask for help. How could he help me! He is not to blame for my lack of DYOR. Cognitive dissonance on my part that blocked effective communication.

However, I did not give up on my effort. The greed to bite into the triple-digit APR was the incentive to enter the manual pool without knowing in depth what he was doing. After all, you bet what you allow yourself to lose. What silly advice!

It is one thing to knowingly; Take risks, and another is to blindly enter a cave in the bay, following songs of sirens.

Yes, now, after hitting the ignorance, my modest investment entered the pool, more like a gamble in a casino than a well-thought-out investment.

So, if you want to participate in DEFI at SmartBCH and collaborate with the growth of the Bitcoin Cash ecosystem, I recommend you not to follow my example.

Well, in short, if it suits you to know and handle the basics. So, you should investigate:

  • How does the liquidity pool operates?

  • What is a liquidity prover (LP) and what it is for?

  • How to enter farming (contribution of a pair of tokens to the liquidity pool with symmetric monetization to obtain the reward to enter the modality)?

  • What are pools or stakes?

  • What is the impermanent loss (currency risk), and how to manage it?

Among others aspects, and to name just ones. Moreover, learning to distinguish between ROI, APR, APY, and how these are related on the DEFI.

Finances are not as complex as they paint it, but they require on your part that you pay due attention to them if you do not want to lose your money in the attempt.

By the way, after three weeks, my investment lost about 60% of its value. Sure, now I have more chips but with a lower price (volatility). Although I am not concerned, my bet is not short-term.

I trust SmartBCH and the community that supports the Bitcoin Cash ecosystem.

An original article by @Jnavedan

Cover image by Pete Linforth on Pixabay modified by me

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Avatar for Jnavedan
Written by
2 years ago
In community: Cryptocurrency and Blockchain(7b7f)
Topics: SmartBCH, Earn crypto, Economy, BCH, DEX, ...

Comments

We all pay a little on the learning curve and that is a bit inevitable but as you say finances are not difficult, as long as we study how they work and the risks involved. Good luck on your SmartBCH journey.

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User's avatar CoquiCoin
2 years ago

Very interesting article, with a simple and humorous lexicon. It makes it look simple and even a bit funny. I like reading this kind of content, but I'm not yet ready to dive into the knowledge of distinguishing ROI, APR, APY and even less to relate it to DEFI. It's like you say, another language. I think I still have to overcome some learning stages in order not to let myself succumb to the caves of the mermaids. Again I say it was very interesting your content. Regards.

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User's avatar rodriguezpct
2 years ago

I don't see posts thanking me for buying LAW token or CATS token when I started writing about these two and expressed my opinion that the price will reach a lot higher. CATS price went up as well and I've frequently written about these two projects.

Don't like losing either, but I also lost money so far with various investments. Latest one with the Cat NFTs I bought, but I don't write that I followed the recommendation of someone else about it. I bought 1BCH in cats NFTs only to see the team was selling more cat NFTs on auction for a week more, starting at an extremely lower price and most were not selling at all. This feels like an investment that went wrong and I feel that I lost 1BCH there.

And I also bought Law Punks at 0.01BCH each and made multiple BCH from this since the current floor price is 0.07BCH and this is just for the common NFTs. I write about all projects I'm investing in. Some investments go wrong others do well.

When investing there is always a danger of loss and I've said not to invest just in muesli. In the introduction I wrote this: "𝐈 𝐩𝐥𝐚𝐧 𝐭𝐨 𝐢𝐧𝐯𝐞𝐬𝐭 𝐢𝐧 𝐚𝐥𝐥 𝐭𝐡𝐫𝐞𝐞 𝐒𝐦𝐚𝐫𝐭𝐁𝐂𝐇 𝐃𝐄𝐗𝐬 𝐚𝐧𝐝 𝐈'𝐯𝐞 𝐚𝐥𝐫𝐞𝐚𝐝𝐲 𝐞𝐱𝐩𝐥𝐚𝐢𝐧𝐞𝐝 𝐦𝐲 𝐫𝐞𝐚𝐬𝐨𝐧𝐢𝐧𝐠, 𝐰𝐡𝐢𝐜𝐡 𝐢𝐬 𝐭𝐨 𝐝𝐢𝐯𝐞𝐫𝐬𝐢𝐟𝐲 𝐫𝐢𝐬𝐤 " and I've also specified in many parts of this article there are always dangers we don't know about. I don't have to explain myself anyway.

I have no connections with any project and nobody pays me to write anything. If there will ever be any project that asks me to write under a payment agreement, I would specify this with bold letters at the beginning of the article. I don't have inside information as others have and don't plan to find edges, since this is not how I work. I write about what I see and what I experience.

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User's avatar Pantera
2 years ago

Hi, my dear friend,

Thank you for clarifying the purpose of your writing, and that is why I value it so much. My friend, the connoted purpose of this, my article, is to show that everyone must do the research and weigh the available information before entering an encryption project.

For example, I did not enter Muesliswap just because you recommended it. By the way, great articles about it, but because I wanted to try it out for myself. The Leofinance Cub would have been the same, but I decided to do it at SmartBCH because I think of the potential it has. I love the Hive ecosystem too, being there I learned a lot about what I know now about the world of cryptocurrencies.

Sometimes I hesitate to tag a person in my posts, since considering language barriers and transliterations, I fear that the message did not get through as I want it to. Even when I write in my mother tongue, Spanish. My wife and my eldest son, who is almost 33 years old, can attest to that. LOL.

So keep writing as you have been my friend, you are a writer with a lot of potential not only here at read.cash.

By the way, my investment in the swimming pool at Müesliswap is now in the red, but I suspect that sooner rather than later, it will be green again. And if not, it doesn't matter. Knowledge has no tangible price and at this point in my life, money does not have the same value as in my youth.

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User's avatar Jnavedan
2 years ago

First steps in investing our hard earned crypto are daunting and confusing, I can totally relate. I had to do a lot of research, but with time it all becomes easier. Good luck to you my friend, hope your investment is bringing you some milk already 💙

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User's avatar fantagira
2 years ago

Hello, my friend,

Yes, you are right. The first steps are always the hardest, but in the end, you end up running. I hope that soon I will be able to drink a lot of cold milk. LOL Greetings.

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User's avatar Jnavedan
2 years ago
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