Hey guys! I am trying to answer a question, I

Question

Hey guys! I am trying to answer a question, I

would like to know if you agree with my answer :

Q : If I believe we are going into a major recession and everything is going down in matter of price, what is the best move to protect my value AND stay in the ecosystem?

R : Considering crypto and especially the small caps, like DFI, due to their volatility, already priced in a bigger part of the pain to come than stocks and big coins, and considering USD is probably going to be the best performer in a recession, converting my value in a DFI-USD pool is the best solution to mitigate further capital loss with the price stability of USD, DFI (since it is closer to its bottom) and the passive income from the pool.

Opinions?

#blockchain #cryptocurrency #defichain #english

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28.07.2022

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T hawk

It depends.. like always. If you are ok with being 50% in dfi and hold 50% USDC/T then you can put it to LM. Impermanent loss would be due if you exit the pool lower, you end up with more DFI and less stable coins (it’s kind of automated DCA on the way down). The stable coins you have left then cld be used to buy more DFI or other Cryptos, stocks.. whatever you prefer. But on one point I have to disagree. If we do go lower history has shown that altcoins tend to perform worse than bigger coins even they lost already more rom top to bottom. Some altcoins in 2018/2019 lost 80% of they value (e.g. 10$->2$) and went down to 0,50$ and lost in total 95%. That means from the point after the initial-80% there was another 75% drop down from 2$->0.5$. Sure, this time could be different, but if you think that things get worse, than you should consider that this could happen again! :-)

0

28.07.2022

Zachary Chan · Accepted Answer

Which USD pool though. USDC and USDT are pegged stablecoins. Dusd is not. Not financial advice, but personally I still think BTC-DFI (or ETH-DFI if you’re big on ETH) to be the “safest” pools in terms on impermanent loss. I’m still happy with the swings on either side of the pool. If could also hodl your main coins - DFI, BTC, ETH. And put them in vaults. Then borrow Dusd and dstocks for LM. That way you don’t expose your crypto to IL or swapping/trading risks in dtokens, and still benefit from LM APR. When you want out. Just payback your loan and retrieve your collateral. Thirdly, you could just put your DFI into staking, which guarantees your principal at least and you just gain interest on top of it. Not everyone has 20,000 for a masternode, but you can stake fractionally in places like Cake or DFX.

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