I live in Sacramento CA. Im looking for someone that I can connect with and help me stake some of my savings. What i mean by help me is make sure I am transfering money from KuCoin to Cake and make sure Im doing this correctly as I dont want to lose money. I have a variety of coins....btc, eth, ada, matic, chain, etc.
I have watched well over 50 videos and I see staking Cake or Hydra or what ever and the APR. When I plug in the numbers at staking $100K in Cake for example this is what I get:
Invest $100,000 at $12.77 per CAKE
Total Reward Rate: 68.53%
Est Monthly Earnings: $5,632.93 or 438.36965 CAKE
Est yearly: $68,534.03 or 5,333 Cake
So you mean to tell me that if I took out a loan from my bank at $100K at 4% APR my monthly payment would be approximately $459/month BUT I will make $5632.93 per month.
So a passive income of $5,583.93!!!!!
This is one of those situations that asks...........is this to good to be true.
Am I missing something?
~snip~
Absolutely yes, the biggest thing you are missing here is price fluctuations. Who told you that cake would remain $12.77 forever? Also, the return or the APR isn't constant too, it too varies a lot with time. But the biggest concern is that what if the price of the cake falls to $2 and never gets back up to $12 or let's say does come back to $12 but after 3 years? During this time your loan installments would still be due, which means every month for repayment of $459 you will have to sell your cakes brought at $12.77 at $2. Also when you re-stake the coin at the end of the first month, chances are its APR might have fallen or increased. So basically it's a big risk you are taking, three big risks:
1. price fluctuations (The Biggest) - Think of people who thought of staking cake at $40. price is now at $12.
2. APR fluctuations
So I won't recommend taking a loan for this type of investment.
