Beginner’s guide to CashCow
Introduction to DeFi
Before we dive straight into CashCow, we first have to understand what DeFi is. DeFi stands for Decentralized Finance, and it is a new form of finance. DeFi is built on blockchain technology, and replaces intermediaries with smart contracts. Let’s take a look at some of the characteristics of DeFi and why they are beneficial:
Permissionless
Anyone can access DeFi products and services without restrictions. This means that regardless of your gender, nationality, government, or beliefs, nobody can stop you from using DeFi.
Trustless
All smart contracts are publicly available for analysis and verification, allowing users to make sure they function exactly as stated. Additionally, all transactions are visible on the ledger and secured by the blockchain and cannot be altered.
Distributed
The key behind a decentralized system is having a distributed ledger. A distributed ledger is a consensus of replicated, shared, and synchronized data spread over multiple nodes with no central authority. This ensures that no one entity is able to corrupt the data.
Programmable
Any service that can be coded into a smart contract can be packaged into a product. This also removes the need for brokers, lawyers, and escrows along with all the headaches involved.
Autonomy
Smart contracts are self-sufficient, they do not require oversight or constant management.
Cost efficient
Along with removing the need for all the different types of intermediaries and management comes the benefit of reducing cost. Blockchain transactions typically cost a tiny fraction of the cost of the same transaction in a traditional market, with some exceptions.
These are just some of the surface benefits of DeFi, with many more intricate advantages to be discovered as you delve deeper.
Introduction to CashCow
What is CashCow? CashCow is a DeFi project which provides some of the most commonly used services in DeFi. CashCow is a lending, liquidity mining, and leveraged mining platform where users can put their unutilised crypto assets to good use, generating income instead of just letting their assets stagnate.
Lending
First, let’s look at lending. How does lending work in DeFi? Lending platforms facilitate lending and borrowing between users. On CashCow, users are able to lend their tokens to a pool which other users can borrow from. Lenders earn interest as well as CashCow tokens, and borrowers have to pay interest while also earning CashCow tokens. The interest rate is algorithmically calculated based on the amount in the pool, and the amount borrowed. A low supply of tokens in the pool will cause the interest to increase, encouraging users to lend more tokens to the pool, while low borrow rate will cause the interest rate to decrease, making it cheaper to borrow. The yield from lending your tokens is much higher than interest rates from traditional banks, which greatly incentivizes users to participate.
Currently, CashCow’s interest rates range from 4% to 86% per year, depending on the token.
Liquidity Mining
Next, let’s discuss liquidity mining. What is liquidity mining? In the world of DeFi, there are platforms called decentralized exchanges, also known as Dexes, which allow users to swap any token with another token directly, without a third party middleman.
It works like this: token pairs are stored in a pool staked by other users, and you simply go to the pool and swap your desired tokens. The users who staked the pool will then receive a small fee from your transaction. Users who stake the pool to earn transaction fees are called liquidity miners. Users who participate in CashCow’s liquidity pools will also earn CashCow tokens.
However, liquidity mining does come with a risk of impermanent loss. You can read more about that here.
Right now, CashCow’s yield ranges from 52% to an astounding 357% per year.
Leveraged mining
Finally, let’s go over leveraged mining. Leveraged mining is a product of combining both the lending and liquidity mining portions and taking it to the next level. CashCow allows miners to increase their leverage from liquidity mining by borrowing from the lending pool using their initial tokens as collateral, and then staking the entire sum. This effectively multiplies the amount earned from liquidity mining by up to sixfold.
Of course, this is not without its risks. Along with multiplied income, impermanent loss is multiplied as well. Leveraged miners carry the risk of having their positions liquidated in the event where their collateral loses too much value relative to what they borrowed. Users can manage their risk by choosing less volatile tokens and adjusting their leverage.
At the moment, CashCow’s leveraged mining yields anywhere from 74% to 225% per year.
CashCow Tokens
CashCow tokens are known as CCF, a BEP-20 token minted on the Binance Smart Chain. CCFs will be used in our decentralized autonomous organization governance protocol, also known as DAO. This will allow holders of CCF to vote on changes to the project and control the project, making CashCow a truly decentralized project.
CCF is also a deflationary token, with most of our revenue being used to repurchase and burn tokens in order to increase the value of CCF.
Security
Of course, security is always an important factor when dealing with valuable assets. CashCow has been audited by one of the best and most well known auditors, Certik. We are also in the midst of getting audited by other reputable auditors, and users can rest assured that their assets are in good hands.
Conclusion
We believe that DeFi is the future of finance. In the short time that DeFi has been around, it has already managed to develop products and services that far outperform the traditional financial market. We will continue to innovate and grow CashCow into a cornerstone of the DeFi industry, and hope that you will join us in our journey.
Telegram(EN): https://t.me/financecow
Telegram(CN):https://t.me/financecowcn
Twitter: https://twitter.com/financecow
Discord: https://discord.gg/NxXhBTxd
