Who wouldn't want to be free and do whatever they want, enjoy time with their loved ones and just live worryless into the day, while their own money is earning more money each and every minute. With Cake DeFi, exactly that is possible! In just a few simple steps, you can achieve a passive income on your cryptocurrencies of 90+% per year.
In this article you will learn how these sometimes astonishingly high returns are achieved and how you can easily earn $2000 or even more in passive income per month with Cake DeFi.
The Importance of Passive Income For Financial Independence
The key to achieving financial freedom is compound interest – also called the eighth wonder of the world by Albert Einstein.
For example, if you invest $5,000 today and add $250 every month to it, at an interest rate of 10% per year, you will have saved just about a million dollars after 35 years.
If the interest rate is a little higher, let’s say 15% per year, then after 35 years your investment will already be a sizable fortune of $4.5 million!
You can see: The power of compound interest is huge, and it’s best when it hits your wallet on a regular basis – several times per day – instead of just once a year.
The great thing about passive income is that it comes in automatically and continuously – much like a perpetual motion machine – and is independent of your work effort.
In the following sections, we'll show you a case study on how you can build passive income with Cake DeFi and calculate how much capital you roughly need to get to $1760 USD in passive monthly income!
Case Study: $1760 USD in Monthly Passive Income With An Initial Investment of 0.75BTC
Let us consider using all three Cake DeFi products: Lending, Liquidity Mining, and Staking.
The Lending product, allows earnings of at least 3.5% and at best a full 6% annualized return. Let's say we invested 0.05 BTC of this 0.75 BTC into Lending and is exposed to virtually no risk, because since Cake DeFi's incorporation, not a single batch has not been paid out. Moreover, the promised return is insured and guaranteed by external partners.
Now let's take the bulk of the crypto assets (0.55 BTC) into the Liquidity Mining product, which offers a whopping 70% return per year. These huge returns do not come without any risk, however, which is mainly related to a concept called "impermanent loss"; yet we'll get into that in more detail further down below.
Last but not least, let's invest 0.15 BTC into Staking – the third product offered by Cake DeFi. Staking is not available for Bitcoin, but it is available for DFI –– a coin that correlates closely with Bitcoin and offers an annualized return of over 70%. Looking at the last 12 months, it can be seen that DFI is not only highly correlated with Bitcoin, but has actually outperformed Bitcoin, which can be taken as a clear indication that DFI is considered one of the best investments in the DeFi space.
But now it’s time to calculate our monthly passive income in all three product categories. We will start with Lending:
Monthly passive income from Lending:
0.05 BTC (investment) * 0.035 (annual return) * $43000 (conversion to USD) / 12 months = $6.27 per month
Monthly passive income from Liquidity Mining:
0.55 BTC (investment) * 0.7 (annual return) * $43000 (conversion to USD) / 12 months = $1379 per month
Monthly passive income from staking:
0.15 BTC (investment) * 0.9 (annual return) * $43000 (conversion to USD) / 12 months = $376.25 per month
Total monthly passive income: = $1761 passive income per month
After you have become familiar with the different products and the huge potential behind them, we would like to tell you more about how they work and the associated risks.
Lending Product and Risks Simply Explained
Lending gives you the opportunity to benefit from profitable and safe investment strategies, which for a long time were reserved for institutional investors only.
For example, the returns are generated by lending the total capital received to large crypto exchanges, which in turn provide this capital to their own users, for example for leverage products, and thus charge fees for it themselves. Other strategies, such as professionally selling call options to generate cash flow, are also used here.
The kicker: as an individual investor, it is hardly possible to provide enough capital to be considered as a partner of a major crypto exchange. However, with the help of Cake DeFi, you can do this and enjoy an investment product that has been closed to small investors for a long time!
And the best thing about all this is that the already very manageable risks (such as the bankruptcy of large, established crypto exchanges) are covered by trustworthy partners like Genesis, Signum or Sparrow. Furthermore, these companies also guarantee the returns that cake can then pay out to you.
So Lending is a product you can really enjoy without any guilt!
Click Here to sign up for Cake DeFi now and try Lending - for a limited time only with $30 USD signup bonus!
Liquidity Mining Product and Risks Simply Explained
Liquidity Mining is probably the most exotic product on our menu, as it requires a bit of baking knowledge.
After you have read up on liquidity mining and the risks involved, a little taste might be worth it. Currently, most cryptocurrencies such as Bitcoin, Ethereum or Litecoin offer a return of over 70% per year!
Now you might ask yourself how such high returns can be earned at all. The answer is quite simple: With Liquidity Mining, you provide liquidity to a decentralized exchange, in this case the one of DeFiChain, and thus enable decentralized trading of the coins listed on it.
In return, you receive a portion of the trading fees, as well as a portion of the block rewards, based on your share of the liquidity pool. The important thing to note here is that the expected returns will decrease as liquidity increases. The reason for this is simple: if more people provide liquidity, then everyone is competing for the same piece of the pie and thus everyone gets a smaller slice of it.
Also not to be underestimated is the risk of impermanent loss, which occurs primarily when one currency pair / coin pair falls or rises significantly more than the other. If you want to learn more about liquidity mining, the potential returns and the associated risks, you can find detailed information about this in the following article: https://julianhosp.com/impermanent-loss-other-liquidity-mining-risks-explained/
However, according to empirical data, the expected returns so far are significantly higher than the Impermanent Loss. Thus, liquidity mining at Cake DeFi is a treat that can really fill you up!
Sign up for Cake DeFi here, start Liquidity Mining today and earn over 70% annual returns! Your compound interest will be huge.
Staking Product and Risks Simply Explained
Staking is the lightest diet and is particularly well suited for those bakers who want to grow their cryptocurrencies.
Staking is a proof-of-stake algorithm that is used by various cryptocurrencies and secures the network - similar to the proof-of-work for Bitcoin. The big advantage here is that the concept is not only more energy efficient and virtually as secure as PoW, but on top of that it also allows anyone to earn returns on their staked cryptocurrencies!
The only risk one is exposed to here is the unpredictable price development of the underlying cryptocurrency itself.
Furthermore, it should be noted that the returns vary greatly from coin to coin - this is mainly due to the underlying issuance structure of the respective coin. In general, however, the longer a cryptocurrency has been in existence, the lower the returns. In analogy to Bitcoin halving (a reduction of the emission implemented in the code), staking coins also experience a reduction of the emission and thus the returns at regular intervals.
By far the most popular staking coin at Cake DeFi is DFI - a cryptocurrency that has been rising rapidly in recent weeks and months, and is currently sweetening your account with sugar-sweet 70% staking returns; and it gets even better with the all-new freezer that doubles your rewards, which will be covered in the upcoming articles!
Click Here to sign up for Cake DeFi and start staking!
What are you waiting for? Get passive income and may the force of compound interest be with you!
