They pointed out that one of the main problems is the high yields that some airdrops promise. They recommended diversifying investments in wallets from different official Blockchains, such as Oasis or Polkadot.
In the latest Cryptocapital program on Capital Radio, hosted by Sergio Fernández (@Sergio_fdez_7), experts recommended that crypto holders document themselves before investing in Decentralized Finance (DeFi) protocols, since their high returns are also accompanied by risks.
In August, Chainalysis revealed that from January to July 2022, funds stolen in cryptocurrency hacks totaled $1.9 billion, up from $1.2 billion during the same period last year, and funds stolen from DeFi protocols have seen cryptocurrency hack losses skyrocket nearly 60% in the first half of the year.
The guest panel of the crypto gathering on October 28 was made up of the following experts:
B-BLOCK (@b_block_oficial).
SECRETO DEFI (@SecretoDefi).
Christian Wupperman (@Christianwupp).
Bruno Marcial (@BRUNOCRIPTO_).
Host Sets the Scene
Cryptocapital host Sergio Fernández (@Sergio_fdez_7) argued that DeFi hacks suggest that holders have not been informed enough:
“DeFi is important within the crypto industry. It is always said that cryptos make you the owner of your own money. When did DeFi emerge? We know that Bitcoin started in 2009. What is DeFi for? Defi is basically getting a return on our money. Yield Farming is something similar. There are pros and cons.”
The panel of specialists agreed that DeFi is “total freedom”, as long as the holders have precise knowledge about the benefits and risks, although the former is greater due to the returns that can be achieved.
“With DeFi you can get returns on staking, to go one step further, you deposit coins to validate transactions on the Blockchain. Those coins have a purpose, you can also use them to make transactions, and you can use DeFi to make or take loans. A simple strategy: In Aave, for example, you deposit USDC or your trusted stablecoin and earn 3% per year, it’s something, but in a safe and simple way.”
Benefits Outweigh Risks
In late September, Jerome Powell, chairman of the Federal Reserve, said that DeFi regulation should be done “with caution”. BeInCrypto reported Powell’s warning to all regulators that, for now, the DeFi ecosystem is not big enough to threaten the fiat monetary system, but this won’t last forever.
The latest Cryptocapital panel explained that Yield Farming has become relevant in the last year, due to the constant returns of its investors or holders, who only need to provide liquidity to obtain returns with different options.
However, they recommended reviewing the actors behind the projects.
“One downside of DeFi is bad actors. People who are intentionally draining purses. It is recommended that users study and be careful not to fall into scams. Some errors are imperceptible and will only empty their wallets. There are many airdrops that promise high returns, when they actually just drain liquidity. It is better to diversify to reduce risks, such as having wallets on different Blockchains, Oasis, Polkadot, and staking on the official platform.”
By Audy Castaneda
