Thread 60850906

Thinking about throwing some USDC into AAVE for yield. Is it actually safe or are there hidden risks im not seeing? like smart contract exploits, depeg risk, liquidation issues, whatever. Don't wanna get rugpulled just for a few % APY. Anyone here doing it long term?

>>60850906 (OP)
As far as lending goes, it’s as safe as you’re going to get. Staking though is explicitly more risk, your money is part of the insurance fund if there’s an exploit that causes a shortfall

>>60850906 (OP)
enjoy your 7% yield until a black swan nukes the whole protocol. you're literally picking up pennies in front of a steamroller

>>60850922
If aave goes, everything goes.

>>60850926
What this anon said.
If AAVE unwinds with $70B in it, then our whole industry is dead for 18 months or more. Everything in the gutter.

>>60850906 (OP)
If you want zero risk just buy treasuries boomer. AAVE is basically "blue chip" DeFi, biggest risk is stablecoin itself losing peg. DAI and USDT sketch, USDC safer.

>>60850906 (OP)
There's smart contract risk with any on-chain dapp but AAVE has been around for half a decade without issues. The yield is good now but keep in mind that it fluctuates and will likely go lower soon. Personally, I stake USDE on Ethena for slightly higher APR and to farm points for their ENA airdrop.

>>60850906 (OP)
been in AAVE for 2 years no rug. only risk is if Circle or USDC decides to freeze you kek.

>>60850942
not your keys not your coins but worse
you're trusting 100k lines of solidity code written by some indian intern
one bug and your stables are gone forever

>>60850942
>for 2 years no rug
said the same thing about Celsius, BlockFi, Anchor… now my bags are dust. If there's a liquidation cascade like 2022, you're exit liquidity, good luck fren.

>>60850998
>If there's a liquidation cascade like 2022, you're exit liquidity
well, i can wait some months until the bear market starts and if everything is still intact i'll put 30% of my portfolio into AAVE for yield and the rest in something else

>>60850906 (OP)
>not worth it because capital gains tax is much higher

>>60850906 (OP)
Getting a couple % above risk free rate to have smart contract AND slashing risk, why yes I love losing money

>>60850922
>dude everything is inevitably destroyed

Get your money out of the bank anon before a "black swan" makes them insolvent or whatever

>>60851529
it's all decentralized, they won't find me so im not paying taxes lol

>>60851541
AAVE contracts have billions TVL and years of audits. tail risk exists, but you're compensated with yield above treasuries.

>>60851529
>not knowing how to using de green text saar

Listen third world eastern european, I know your brain is very small, but capital gains tax only applies to your gains, your profit, the money you make. Do you get it? There is no scenario where "sire , de capital gain tax is much higher ,," and you lose money or something. Do you understand now fucking retard?

>>60851587
>cashing out founds you

>>60851599

de cashing out , founds you ,, ! I am russian ,,

>>60851582
Aave is not FDIC insured retard, i'll rather keep my money in a bank with lower interest than risking everything in some random bad protocol

>>60851596
>7.55% is your profits

>>60850906 (OP)
bottom signal.

>>60850906 (OP)
The core protocol has been around forever and is battletested, the new Umbrella staking module hasn't so you should consider it to be of a higher risk since the auditors may have missed something.

>>60851643
>true story

>>60850998
AAVE was around during that era and survived, also Celsius and BlockFi were CeFi solutions, not DeFi smart contract solutions. Anchor collapsed due to inherent bad design, not due to some smart contract bug.

>>60850926
wrong, aave uses chainlink

>>60851648
the base protocol gives only 4.59% APY but supposedly no slashing risks since is governed manually right? also i can see that the Umbrella protocol has withdrawal constraints like 20 days cooldown which might be inconvenient so probably i'll stick with the base one

>>60851613
>FDIC is safe!
he doesn't know about the meetings

>>60851698
>the base protocol gives only 4.59% APY but supposedly no slashing risks since is governed manually right?
Per the protocol the only powers the DAO and such have is to change the interest rate curve, change the supply or borrow cap (but you can stay have funds over the cap, only prevents new funds), and freeze borrowing, withdraws, and deposits. All these powers are universal, that is non-discriminatory against individual depositors, so AAVE cannot uniquely freeze your aUSDC but could freeze everyone's aUSDC, which is a subset of the powers traditionally held by banking institutions.

>>60851675
That's correct.
Which is why the same is true of LINK.
If Chainlink dies, everything dies. It's beyond fucking over if LINK is majorly compromised.

>>60850906 (OP)
i remember during the last bear market, all the crazy yields and pools turned shit and never came back.

>>60851750
i was also thinking of using the Base wallet from Coinbase but it seems that i have to connect to my coinbase account in order to enable APY rewards, do they report my transactions to the tax authorities? im curious how they lend out the USDC, since the assets never leave my wallet (USDC is still USDC) and i own the private keys, this must be executed by their own protocol right?, which i wonder if is more safer in terms of liquidity than aave is

>>60850906 (OP)
AAVE has existed for years and years because it is one of the better places to get yielded up. It's good. Haven't seen any exploits since I started using it.
>>60850922
Read above.
>you're literally picking up pennies in front of a steamroller
As a son, doge and pepe holder this line is pretty funny, though.