Close Menu
  • News
    • Bitcoin
    • Altcoins
    • DeFi
    • Regulation
    • Market Cap
    • Web 3
    • Scam
  • Blockchain
  • NFT
  • Metaverse
  • Analysis
  • Learn
  • Blog
  • Contact
    • Tech7685@gmail.com
What's Hot

Hashkey chain reveals the puzzle game of the chains in the chains in collaboration with Zypher Network

2025-05-09

Markt -Expert says that dominance has hit its ceiling

2025-05-09

Trader says Bitcoin on CUSP to break out from Beerarish market structure, sketches path to new multi-month high

2025-05-09
Facebook X (Twitter) Instagram
  • Contact
  • Terms & Conditions
  • Privacy Policy
  • DMCA
  • Advertise
  • BitcoinPlatform.com
Facebook X (Twitter) Instagram
Free Cryptocurrency – Bitcoin | Altcoins | Blockchain | News Stories Updated Daily
  • News
    • Bitcoin
    • Altcoins
    • DeFi
    • Regulation
    • Market Cap
    • Web 3
    • Scam
  • Blockchain

    Hashkey chain reveals the puzzle game of the chains in the chains in collaboration with Zypher Network

    2025-05-09

    Superstate is spreading to Tokenized shares; Sol -Strategies to mention first

    2025-05-09

    What are Babydoge -Properties?

    2025-05-09

    Vietnam launches his first blockchain network from home -grown: Details

    2025-05-09

    Crypto -Developer activities returns to the level of 2018, Ethereum retains a significant part of the innovation

    2025-05-09
  • NFT

    Drink-to-earn? A new sparkling water comes with an NFT and points

    2025-05-08

    Cobie says we will return if someone buys this $ 20 million NFT

    2025-05-08

    Edge Matrix, Colabs Partner to strengthen NFT -Makers

    2025-05-08

    Argentinian football club Partners with StepN to launch digital sneakers

    2025-05-05

    Pudgy Penguins #6873 Leads with Top NFT -sale worth $ 360.2k

    2025-05-04
  • Metaverse

    Shib: The Metaverse – Part of the expanding Shiba Inu ecosystem

    2025-01-03

    Experience to Earn: Everdome’s Metaverse Frontier

    2024-12-30

    Beyond Bots: Meta Motivo and the Dawn of Human Digital Life

    2024-12-13

    Exploring NetVRk: What’s Behind This AI-Powered Virtual Universe?

    2024-10-28

    Council of Europe emphasizes the impact of Metaverse on privacy and democracy

    2024-09-05
  • Analysis

    Trader says Bitcoin on CUSP to break out from Beerarish market structure, sketches path to new multi-month high

    2025-05-09

    XRP – Price breaks through obstacles – could a bullish peak follow?

    2025-05-09

    Bitcoin whales and sharks stored $ 7,890,599,380 in BTC in just six weeks, says Analytics platform – this is what it means

    2025-05-09

    BNB Price objectives $ 650 in the midst of renewed market optimism

    2025-05-09

    Trump Crypto Advisor picks up $ 300,000,000 for the new Bitcoin (BTC) investment firm called Nakamoto: Report

    2025-05-08
  • Learn

    What Is a Layer-1 (L1) Blockchain?

    2025-05-03

    What is a Layer-2 (L2) Blockchain Network Solution?

    2025-05-02

    What Is a Layer-0 Protocol?

    2025-05-02

    What Are Utility Tokens? Types, Roles, Examples

    2025-04-17

    Real-World-Assets in Crypto, Explained

    2025-04-16
  • Blog
  • Contact
    • Tech7685@gmail.com
Free Cryptocurrency – Bitcoin | Altcoins | Blockchain | News Stories Updated Daily
Home»Web 3»“27% annual returns.” Sounds good, too good to be true? It is.
Web 3

“27% annual returns.” Sounds good, too good to be true? It is.

2024-02-21No Comments2 Mins Read
Share
Facebook Twitter LinkedIn Pinterest Email

TL; DR

  • A new DeFi platform, Ethena, is promoting 27% annual returns for users who stake their stablecoin (which sounds way too good to be true, and probably is).

Full story

In high school, Kevin (our intern) spent the summer forming a “deep friendship” and “unshakable bond” with his hero, Criss Angel, on Facebook.

(This is something he still claims to this day – and none of us have the heart to tell him that he was almost certainly catfished).

There is a parallel with that story, and Ethena – a new DeFi platform promoting 27% annual returns for users who stake their stablecoin.

That sounds way too good to be true.

And it probably is. Let’s dive in:

We should preface this with a reminder that stablecoin projects like this, which offer ridiculously high returns, tend to fail. pitiful.

(*Cough cough* Terra).

High returns can often be maintained in a bull market, when no one is asking questions…

But when conditions deteriorate and people start withdrawing their money, it’s difficult to liquidate multiple large holdings without “destabilizing the stablecoin” and crashing its price.

How does Ethena try to distinguish herself?

The stablecoin revenue comes from two sources:

By betting Ethereum (which earns ~5% per year) and by shorting Ethereum futures (which earns ~20% per year).

This is what that last bit means:

Shorting = betting that the price of a crypto/share will fall.
Futures = betting on the future price of a crypto/stock by agreeing to buy it at a fixed price, on a fixed date in the future.

So if someone is shorting futures – he is betting that these futures buyers are “betting on the future” – he is wrong…confused? The same.

See also  Vitalik Buterin outlines how Ethereum's Verge can bring blockchain nodes to smartwatches

Here’s an example for you:

  • Someone buys a futures contract thinking that Ethereum will be worth it fewer than it is now, in two months →

  • You think they’re wrong, so you borrow their futures contract from them and sell it →

  • You wait two months and can (hopefully) buy back the contract for less than you sold it and collect the difference.

All that means is, when you stake Ethena, you’re essentially lending your money to the project and saying, “Go stake/invest my money and send me a kickback.”

To which they respond: “Sure, we can offer an annual return of 27%.”

Which sounds:

  1. Sweet!

  2. Way, way, WAY too good to be true.

(It gives off a ‘Kevin’s relationship with Criss Angel’ vibe).

Source link

annual Good returns sounds true
Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Posts

Crypto -Developer activities returns to the level of 2018, Ethereum retains a significant part of the innovation

2025-05-09

Post Pectra, Ethereum is now focusing on efficiency with 60 million gas limit expansion

2025-05-08

Crypto VC funds are struggling to record money as rebounds of starting fundraising in 2025

2025-05-07

Ethereum’s Vitalik Buterin reveals ‘true alpha’ in Crypto

2025-05-05
Add A Comment

Comments are closed.

Top Posts

How the Metaverse can improve the lives of people with disabilities

2023-05-19

2024-12-26

This Is Where Ethereum Could Finally Bottom Out Against Bitcoin, Says Crypto Analyst

2024-11-25
Editors Picks

XRP Price Heading Toward Crucial Resistance At $0.8 – Here’s What The Next Move Could Be

2023-07-18

NFTs Theft Worth $1.73 Million, Drops 31% In July 2023

2023-08-07

Uniswap Unveils v4 Upgrade, Designed to Enhance Community Feedback

2023-06-14

How the Israel-Iran War Could Shake Cryptocurrency Prices: Arthur Hayes

2024-10-16
About
About

Our mission is to develop a community of people who try to make financially sound decisions. The website strives to educate individuals in making wise choices about Cryptocurrencies, Defi, NFT, Metaverse and more.

We're social. Connect with us:

Facebook X (Twitter) Instagram Pinterest YouTube
Top Insights

Hashkey chain reveals the puzzle game of the chains in the chains in collaboration with Zypher Network

Markt -Expert says that dominance has hit its ceiling

Trader says Bitcoin on CUSP to break out from Beerarish market structure, sketches path to new multi-month high

Get Informed

Subscribe to Updates

Get the latest news and Update from Free.cc about Crypto, Metaverse, NFT and more.

  • Contact
  • Terms & Conditions
  • Privacy Policy
  • DMCA
  • Advertise
  • BitcoinPlatform.com
© 2025 Free.cc - All rights reserved. Contact: info@free.cc

Type above and press Enter to search. Press Esc to cancel.

  • bitcoinBitcoin(BTC)$102,898.611.58%
  • ethereumEthereum(ETH)$2,320.2313.32%
  • tetherTether USDt(USDT)$1.00-0.04%
  • rippleXRP(XRP)$2.344.32%
  • binancecoinBNB(BNB)$634.242.19%
  • solanaSolana(SOL)$170.686.86%
  • usd-coinUSDC(USDC)$1.00-0.03%
  • dogecoinDogecoin(DOGE)$0.2037747.06%
  • cardanoCardano(ADA)$0.786.92%
  • tronTRON(TRX)$0.2611072.14%
  • suiSui(SUI)$3.89-1.20%
  • chainlinkChainlink(LINK)$15.913.63%
  • avalanche-2Avalanche(AVAX)$23.017.78%
  • stellarStellar(XLM)$0.2951334.33%
  • shiba-inuShiba Inu(SHIB)$0.0000156.77%
  • hedera-hashgraphHedera(HBAR)$0.1985753.98%
  • hyperliquidHyperliquid(HYPE)$24.5611.73%
  • bitcoin-cashBitcoin Cash(BCH)$408.08-2.60%
  • the-open-networkToncoin(TON)$3.251.12%
  • unus-sed-leoUNUS SED LEO(LEO)$8.69-1.37%
  • polkadotPolkadot(DOT)$4.759.87%
  • litecoinLitecoin(LTC)$98.395.85%
  • moneroMonero(XMR)$306.563.26%
  • daiDai(DAI)$1.000.00%
  • bitget-tokenBitget Token(BGB)$4.460.30%
  • pepePepe(PEPE)$0.00001220.70%
  • piPi(PI)$0.7213.57%
  • ethena-usdeEthena USDe(USDE)$1.00-0.01%
  • uniswapUniswap(UNI)$6.3013.45%
  • bittensorBittensor(TAO)$422.761.41%
  • nearNEAR Protocol(NEAR)$2.8910.71%
  • aptosAptos(APT)$5.505.09%
  • okbOKB(OKB)$53.331.74%
  • ondo-financeOndo(ONDO)$1.016.22%
  • aaveAave(AAVE)$207.568.97%
  • ethereum-classicEthereum Classic(ETC)$19.188.07%
  • internet-computerInternet Computer(ICP)$5.367.75%
  • official-trumpOFFICIAL TRUMP(TRUMP)$13.9012.26%
  • gatechain-tokenGateToken(GT)$21.850.16%
  • kaspaKaspa(KAS)$0.1022394.36%
  • crypto-com-chainCronos(CRO)$0.1005484.20%
  • polygon-ecosystem-tokenPOL (prev. MATIC)(POL)$0.2517330.32%
  • mantleMantle(MNT)$0.773.47%
  • render-tokenRender(RENDER)$4.905.15%
  • vechainVeChain(VET)$0.0294338.01%
  • usd1World Liberty Financial USD(USD1)$1.000.15%
  • ethenaEthena(ENA)$0.36338315.20%
  • filecoinFilecoin(FIL)$3.025.91%
  • algorandAlgorand(ALGO)$0.2320807.04%
  • artificial-superintelligence-allianceArtificial Superintelligence Alliance(FET)$0.8310.53%
  • bitcoinBitcoin(BTC)$102,898.611.58%
  • ethereumEthereum(ETH)$2,320.2313.32%
  • tetherTether USDt(USDT)$1.00-0.04%
  • rippleXRP(XRP)$2.344.32%
  • binancecoinBNB(BNB)$634.242.19%
  • solanaSolana(SOL)$170.686.86%
  • usd-coinUSDC(USDC)$1.00-0.03%
  • dogecoinDogecoin(DOGE)$0.2037747.06%
  • cardanoCardano(ADA)$0.786.92%
  • tronTRON(TRX)$0.2611072.14%
  • suiSui(SUI)$3.89-1.20%
  • chainlinkChainlink(LINK)$15.913.63%
  • avalanche-2Avalanche(AVAX)$23.017.78%
  • stellarStellar(XLM)$0.2951334.33%
  • shiba-inuShiba Inu(SHIB)$0.0000156.77%
  • hedera-hashgraphHedera(HBAR)$0.1985753.98%
  • hyperliquidHyperliquid(HYPE)$24.5611.73%
  • bitcoin-cashBitcoin Cash(BCH)$408.08-2.60%
  • the-open-networkToncoin(TON)$3.251.12%
  • unus-sed-leoUNUS SED LEO(LEO)$8.69-1.37%
  • polkadotPolkadot(DOT)$4.759.87%
  • litecoinLitecoin(LTC)$98.395.85%
  • moneroMonero(XMR)$306.563.26%
  • daiDai(DAI)$1.000.00%
  • bitget-tokenBitget Token(BGB)$4.460.30%
  • pepePepe(PEPE)$0.00001220.70%
  • piPi(PI)$0.7213.57%
  • ethena-usdeEthena USDe(USDE)$1.00-0.01%
  • uniswapUniswap(UNI)$6.3013.45%
  • bittensorBittensor(TAO)$422.761.41%
  • nearNEAR Protocol(NEAR)$2.8910.71%
  • aptosAptos(APT)$5.505.09%
  • okbOKB(OKB)$53.331.74%
  • ondo-financeOndo(ONDO)$1.016.22%
  • aaveAave(AAVE)$207.568.97%
  • ethereum-classicEthereum Classic(ETC)$19.188.07%
  • internet-computerInternet Computer(ICP)$5.367.75%
  • official-trumpOFFICIAL TRUMP(TRUMP)$13.9012.26%
  • gatechain-tokenGateToken(GT)$21.850.16%
  • kaspaKaspa(KAS)$0.1022394.36%
  • crypto-com-chainCronos(CRO)$0.1005484.20%
  • polygon-ecosystem-tokenPOL (prev. MATIC)(POL)$0.2517330.32%
  • mantleMantle(MNT)$0.773.47%
  • render-tokenRender(RENDER)$4.905.15%
  • vechainVeChain(VET)$0.0294338.01%
  • usd1World Liberty Financial USD(USD1)$1.000.15%
  • ethenaEthena(ENA)$0.36338315.20%
  • filecoinFilecoin(FIL)$3.025.91%
  • algorandAlgorand(ALGO)$0.2320807.04%
  • artificial-superintelligence-allianceArtificial Superintelligence Alliance(FET)$0.8310.53%