Gate.io launches a series of user-friendly financial tools to provide users with low-risk ways to generate income. This article will give you an in-depth understanding of Gate.io’s Yubibao, Fixed Investment Financial Management and Dual Currency products. Altcoin
Preface
In 2024, we are about to usher in Bitcoin’s fourth halving. In the fermentation of the halving market, investors in the market have shown their demand for derivatives for stable financial management and hedging risks. Some CeFi financial products with simple operations and relatively stable returns have gradually become the main business direction of exchanges and financial service institutions. These product types have also evolved from the initial single deposit currency to earn interest, to more diversified, large-scale, and differentiated products such as dual-currency financial management, staking, lending, and strategic trading.
Common ways to manage money in cryptocurrencies
DeFi decentralized finance
DeFi financial products refer to DeFi protocol products built on Layer 1 or Layer 2 blockchains such as Ethereum and Arbitrum, which provide users with functions such as asset allocation, management, and interest generation. Users can interact directly with these protocols through Crypto wallets, typically by transferring assets in the wallet to these protocols’ smart contracts. Subsequently, these assets will be allocated to other protocols in the market, and profits will be made by providing liquidity for various economic activities such as trading and lending in the market.
Decentralized financial products mainly include several types such as lending, income aggregators, structured products, liquidity mining and liquidity staking. After years of development, the DeFi ecosystem has undergone earth-shaking changes, and the total locked value (TVL) has reached a maximum of 228 billion US dollars.
Features: No third-party fund custody, different protocols can be freely combined, entry and exit times can be freely selected, and automated.
CeFi centralized finance
CeFi refers to centralized finance, that is, users place funds in the hands of trusted third parties, and fund custody is based on trust in the third party. In the field of cryptocurrency, CeFi has gradually evolved into a concept that represents the existing centralized financial system.
CeFi can usually provide a complete set of systems and services to meet the needs of different customers. It is also easier to accept supervision, achieve compliance operations, reduce systemic risks, and avoid potential risks of interacting with smart contracts.
In the field of stablecoin financial management, CeFi service providers mainly provide financial products for centralized exchanges, financial products for Crypto Banking, and investment and financial products for traditional financial institutions. Among them, the exchange has created unique advantages for its financial management business with its large user group and abundant capital reserves.
The exchange's stablecoin financial management products are closer to traditional bank financial management, and new products have been launched based on the characteristics of blockchain, including current financial management, regular financial management, DeFi mining, liquidity mining, etc.
Features: low learning cost, high degree of opacity, and large regulatory impact.
summary
The advantages of DeFi financial products include high transparency, low participation threshold, and transparent income. But the disadvantage is that it is seriously affected by the market, and the rate of return is extremely low when the market is not good. At present, only lending agreements can barely maintain a certain scale, and the TVL of other income-type agreements has dropped a lot. Most of the financial products provided by CeFi institutions have problems such as opaque scale and unclear income sources. A large part of the revenue source of CeFi financial products comes from agents participating in DeFi financial products. The types of financial products it provides are also relatively rich, and the yields are relatively high. Therefore, a CeFi platform with a relatively high degree of recognition has become one of the more preferred choices for users in the current market environment.
CeFi financial service provider
From the perspective of the issuers of CeFi financial products, they are mainly divided into crypto financial service institutions, digital asset wallets and exchanges. We will select an institution that is relatively well-known in each field and introduce it.
Crypto financial services institution
PayPal Finance is a comprehensive crypto financial service provider established in August 2018. It mainly provides comprehensive financial services such as crypto asset deposits and loans, asset management, brokerage, and derivatives trading to high-net-worth qualified individual investors and institutional investors.
After establishing its core customer base, PayPal Finance gradually launched new customized products based on customer needs, such as the officially launched PayPal Private, which is similar to China Merchants Bank’s Golden Sunflower private customized services for high-net-worth customers.
According to official news, PayPal Finance announced emergency measures in 2022 to improve its liquidity position and has obtained a debt repayment deferral to relieve liquidity pressure.
Digital asset wallet
HyperPay is a digital asset wallet that integrates managed wallets, self-managed wallets, co-managed wallets, hardware wallets and other services. It also has financial value-added, currency-to-crypto transactions, legal currency transactions, lightning exchange, mortgage lending, market tracking, multi-signature co-management, and asset management. Escrow, merchant payment and other functions.
HyperPay was first registered in Melbourne, Australia. The HyperPay digital wallet project was launched in 2017 and officially launched in February 2018.
HyperPay business is aimed at both B-end users and C-end users. For ordinary currency holders, they can choose managed financial wallets. For large-asset customers and institutional users, they can choose self-managed wallets, co-managed wallets or customized hardware wallet solutions.
exchange
Gate.io is a long-established cryptocurrency exchange. Yubibao is a professional financial product provided by Gate.io to users, dedicated to providing efficient matching services for users with idle assets and borrowing needs. By realizing flexible lending of funds, users can obtain corresponding income based on the current annualized interest rate determined every hour. On December 4, 2023, Gate.io Yubibao’s financial management volume reached a new high, with the total value exceeding the 500 million USDT mark, reaching a milestone breakthrough.
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CeFi single currency financial products
Affected by the thunderstorms in the crypto market in 2022, the concept of safe-haven assets has been mentioned and valued again, and the concept of digital currency financial management has begun to stand out in the market. The more common digital currency single currency financial management methods on the market are mainly Yu currency financial management, fixed investment financial management and dual currency financial management.
1. Yubi Financial Management
Yubi Financial Management is a coin-to-coin value-added product that can be deposited and withdrawn at any time, calculating interest by the hour, and supporting customization of interest rates. After the user transfers the assets to Yubi Financial Management, the system will determine whether the loan is successful based on the lending rate set by the user at every hour. After the loan is successful, the interest for that hour can be obtained. Otherwise, the interest cannot be obtained and you need to wait for the next hour. Matching results.
Features: Subscription at any time, redemption in seconds, flexible and risk-free, helping users improve the utilization rate of idle funds at any time
2. Fixed investment and financial management
Fixed investment is a relatively low-risk long-term investment method, especially suitable for investors who want to accumulate assets in the cryptocurrency market and avoid frequent buying and selling. As the name suggests, it is a strategy of investing a fixed amount each time to buy a selected currency combination in a fixed time period. When the market fluctuates more violently, by using appropriate fixed investment strategies, you can purchase more chips at low points with the same investment amount, helping users obtain more substantial returns.
This strategy is simple to operate. It uses idle funds to only buy but not sell most of the time, and then sell them together at the same time to make a profit. It is suitable for users who do not have time to watch the market, have low operating frequency, and have funds that can be invested in the long term. The ideal yield curve for fixed investment is the smile curve.
Features: The single investment amount is small, risks are shared, and costs are shared equally.
3. Dual currency financial management
Dual-currency financial management is a short-term investment product with floating returns. It is essentially a structured currency-earning product that combines spot and options. It was usually used for investment in the foreign exchange market in the early days. Dual-currency financial management obtains potential returns by linking to the price changes of the underlying index of digital assets. Compared with other forms of financial management products, dual-currency financial management has controllable risks and higher returns, and is suitable for more rational and professional investors. When dual-currency financial management is issued, the investment currency, settlement date, and linked index price are determined.
Source: https://www.gate.io
Features: Under fluctuating and stable market conditions, it helps users earn relatively fixed rates of return.
CeFi single currency financial product case study
In order to improve user stickiness and attract more users, centralized exchanges will carry out financial management business based on trading functions. Zhima Finance is a financial management business developed by the centralized exchange Gate.io. Currently, 11 financial products are provided, including single-currency financial products, ETH2.0 mining, structured financial management, and liquidity mining. The following takes Gate.io as an example to further analyze single-currency financial products.
Yubibao
Yubibao is a financial product created by Gate.io. It matches users with idle assets with borrowing needs, and determines the annualized interest rate on an hourly basis to obtain income. After the user subscribes to Yubibao, the system will determine whether the loan is successful every hour based on the lending interest rate set by the user and the actual borrowing demand. The system will also determine the current annualized interest rate for that hour, and you can get the interest for that hour if the loan is successful. At the same time, Yubibao also supports custom lending interest rates and deposits and withdrawals at any time. When users subscribe for Yubibao products, they need to set a minimum lending interest rate. After the loan is determined to be successful on the hour, the income will be calculated according to the determined interest rate. The determined interest rate is often greater than the lending rate set by the user. The income for that hour will be settled every hour. It should be noted that if the loan fails because the interest rate is too high, interest will not be obtained for that hour. If funds are redeemed before the hour is determined, interest will not be earned during that hour. On the hour after the user subscribes, the system will begin to match the lender's financial needs with the borrower's borrowing needs. According to the borrowing needs, the lending rate will be bid from low to high until all borrowers' needs are met. The currently matched highest lending rate is the hourly annualized interest rate. If the current annualized interest rate for that hour is greater than the lending rate set by the user, the loan will be successfully lent at the current annualized interest rate for that hour. If the current annualized interest rate for that hour is the lending rate set by the Xiaoyu user, the lending will fail and no income will be obtained. If the current annualized interest rate at that hour is equal to the lending rate set by the user, partial lending or lending may fail. Redemption of funds that have failed to lend can be credited immediately. Users can redeem their funds at any time after successful lending. For successfully lent funds, you will directly enjoy the hourly income, and after redemption, it will be credited to your account on the next hour.
According to Gate.io data, as of January 21, 2024, the capital volume of its platform Yubibao has reached 673 million USDT, and the annualized rate of return of the platform in the past 30 days is 9.59%.
Source: https://www.gate.io
Advantages of using Yubibao for financial management: 1. Opportunity to obtain high returns. 2. Provide hedging opportunities. 3. Not affected by market fluctuations, you can earn profits at any time.
Fixed investment financial management
Fixed investment financial management is a financial management product for cryptocurrency created by Gate.io. Users can create multiple fixed investment plans according to their own strategies.
How to choose the right time to buy and sell has always been a challenge for all traders in the cryptocurrency market. In the highly volatile cryptocurrency market, finding the exact buy price can be like finding a needle in a haystack. Without a good trading strategy, investors can easily suffer losses in both bull and bear markets.
Some famous examples include Zhao Dong, the founder of Moji Weather and the founder of Dfund, who had consecutive liquidations while trading Bitcoin futures in 2014 and 2015, losing hundreds of millions of yuan. However, there are also many smart investors who continue to accumulate high-quality digital assets through consecutive bull markets and ultimately achieve financial freedom. For example, Li Xiaolai, the famous founder of New Oriental, achieved financial freedom by accumulating Bitcoin.
Example of a fixed investment plan: For example, a user starts buying $10 in Bitcoin every week for a year starting one year ago. The value of Bitcoin held by users to date is $3,867, an increase of 6% compared to the investment cost of $3,650.
Data source: https://dcabtc.com/
Advantages of using fixed investment financing:
1. The amount of each purchase is smaller, so investors have less financial pressure and can easily continue investing.
2. It is easy for investors to make plans in advance to avoid temporary shortages of funds.
3. The principle is very simple, even beginners can easily get started.
4. In a falling market, buying in bulk can diversify risks, prevent investors from being locked up in large amounts of funds, and prevent investors from missing the opportunity to buy at low prices.
5. Help investors develop good discipline and saving habits.
6. Keep investors away from market turmoil and psychological stress. Instead, it will help investors spend their time in other areas.
7. Generally speaking, financial markets grow over time, and investors who buy and hold blue-chip assets over the long term can earn substantial returns.
Dual currency treasure
Dual Currency Bao is a short-term investment product created by gate.io involving two different cryptocurrencies. You can earn profits regardless of the market trend. The rate of return provided by Shuangbibao changes with the market, but the rate of return is fixed after investors confirm the purchase. Once the subscription is successful, the order cannot be cancelled, and early redemption is not supported before it expires. After buying, when the settlement period comes, investors are guaranteed to obtain a fixed guaranteed return of the original investment currency, but the investment currency may also be converted into another currency due to market fluctuations. This is why Dual Currency Treasure attracts investment. The greatest characteristic of the person.
In short, Dual Currency allows users to deposit one cryptocurrency and earn income based on both assets. After investing in crypto assets, you can earn income as the value of your investment increases by locking in the rate of return. The income received by users will depend on the final performance of the pledged assets on the expiration date.
For example, depending on the settlement price, it is decided whether the settlement currency of BTC Dual Currency Treasure purchased with BTC is BTC or USDT. If the settlement price is higher than the pegged price, the income earned by the user will be USDT; if the settlement price is lower than the pegged price, the income earned by the user will be BTC.
Source: https://www.gate.io
Advantages of using Dual Currency Financial Management:
1. High yield: Compared with other financial management methods, it can achieve higher returns;
2. The rules are transparent, completely transparent investment rules, and the level of income depends on the judgment of the market;
3. Stable income: No matter whether the market rises or falls, a fixed proportion of profits can be achieved;
4. Flexible term: Flexibly choose the investment term and flexibly configure it according to your own investment style.
Conclusion
Currently, Gate.io has clear advantages in the cryptocurrency financial management market. The platform provides a variety of financial products suitable for users with different risk preferences and different strategies. The annualized rate of return of Gate.io's various financial products currently ranks among the top of all platforms. This means that amidst the violent fluctuations in the crypto market, Gate.io can also provide users with relatively stable capital appreciation and protect users' assets.
Author: Snow
Translator: Piper
Article reviewer: Piccolo, Wayne, Elisa, Ashley, Joyce
Copyright: Gate.io
