Traditional banking systems across the globe face several challenges in offering their clients the best financial services. These flaws in the industry have in turn helped grow the decentralized finance (DeFi) ecosystem, which is the inevitable digital age solution to these problems.
Low saving rates, slow transaction times, high service costs, corruption, bail-in laws, and centralization have all crippled the traditional finance space hence the focus on the new decentralized age in finance. For example, U.S. banks only offer a 0.04% weekly savings rate on deposits, according to the FDIC – meaning you rarely beat inflation if your money remains saved in traditional banks.
DeFi projects solve these problems by offering a sustainable return, instant transactions, and cost-effective methods enabling anyone to participate in finance. The ecosystem’s growth is unmissable. It currently holds $44.12 billion in total value locked – representing a nearly 600% growth rate in the past year as demand reached fever pitch for DeFi products.
The growth has in part been triggered by the launch of new projects and products to further curtail the issues affecting traditional finance. One of the in-demand DeFi platforms, Clever DeFi, is at the center-stage of solving these problems – especially low saving interest rates. Here’s how.
A new automatic interest-earning platform
If you have stayed long enough in DeFi, you have witnessed a number of platforms pitch unique and unprecedented banking solutions ranging from stable and predictable solutions to risky and high yielding opportunities to clients.
As alluded to, traditional saving methods offer little returns to the investors hence the need for these decentralized solutions – Clever DeFi leading the way in providing unique banking solutions.
The platform, launched in 2020, boasts as the first DeFi protocol that distributes automatic interest payments to its native token (CLVA) holders on a pre-programmed routine cycle. The CLVA token holders can enjoy up to 11% fortnightly paid straight to their wallets – easily beating the sub 1% savings rate offered across major traditional banks.
Contrary to most DeFi platforms, Clever DeFi also offers no staking, no lock-in periods, and no terms for CLVA token holders. The interest is paid straight to the non-custodial wallets if you have CLVA tokens allowing you to enjoy the benefits of your crypto with no conditional rules.
Most importantly, the platform reigns as a pure DeFi protocol with token supply starting off at zero, which means the team does not hold any major supply of tokens. This ensures the platform is safe from any “rug pulls” from the development team ensuring organic price recovery in the future.
Gas costs have become a cyclical problem on Ethereum as the DeFi space grows, data from Glassnode shows. The growth of ETH to par-$1,900 levels as of April 1, set the gas costs on a rising trajectory, currently at 188.55 gwei, making it practically impossible to transact small amounts on the blockchain.
With the upcoming EIP-1559 not providing a good “enough solution” for the rising gas costs, users are moving to faster and cheaper chains to save gas costs. Clever DeFi transactions have no gas fees allowing users to earn high interest without worrying about the cost.
The DeFi space is gradually swallowing up traditional finance, with projects such as Clever DeFi looking to offer better financial solutions to clients. Leveraging compound interest, the platform promises up to 307% in the first year of holding the CLVA tokens, a comparable figure to Bitcoin’s rise in 2020, and a blowout for the 0.04% weekly savings rate offered by U.S. banks.