Category: Lending & Borrowing
Recommended Capital: $500+
Time To Set Up: 15 mins
Ethereum Transaction fees are currently high, so prepare by having ETH in your wallet.
How Does It Work?
AAVE is at its core, is just code.
Code that connects borrowers and lenders without either parties knowing who they are borrowing or lending from.
It is essentially different pools of different cryptocurrencies, powered by its users.
Anonymous Peer to Peer lending.
How To Start Earning Interest:
- Browse AAVE's markets, to see the different APY (annual percentage yield) rates on coins.
👉 10% APY means if you deposit $1000 USD Coin, in 1 year your ROI profit would = $100
👉 You can pull out your deposit at ANY time.
👉 Your balance increases every second, and you can see it live on your dashboard.
👉APY rates fluctuate, and are the HIGHEST for stable coin deposits (as seen below)
2. Once you've chosen your deposit currency of choice, load up your MetaMask with it. (Don't forget to add ETH for gas as well
3. Click on the coin & check out the stats for the lending pool (explained below)
👉 Deposit APY = How much % you'll earn on your deposit per year.
👉 Total Borrowed = How much $ from the pool is currently loaned out.
👉 Available Liquidity = How much $ from the pool is currently available for loans.
👉 Utilisation rate = How much $ from the pool is currently available for loans.
👉 Reserve Size = How much $ in total is inside the pool (borrowed out + unborrowed)
(don't worry about the numbers all the way at the bottom, they're for borrowers)
4. Click the "Deposit" button as shown in the picture below:
5. You will be asked to first approve ALL future deposits, click approve and pay the gas fee.
6. Now you can choose the amount you wish to deposit. (Must have it in your MetaMask) - When you click 'continue', MetaMask will pop-up with the transaction details & gas fee. If it all checks out, click "confirm"...if you don't like the current gas prices, click 'reject' and come back later to try again.
7. All done! - Now you can head to your dashboard and watch your balance grow by the second!