A Fools Gold

[Maestro75]

There are many projects asking investors to stake their tokens for APY but they collapsed later for example Midas, they offered 17% APY on USDC, the token went from 38$ to 0 and their swap feature is shut down..

You shouldn't be patronizing any service that's centralized, they only have one fate which is collapsing and this can be caused from hacks or bad choices by the founders of the project just as we saw with the founder CEO of FTX exchange (Sam Bankman-Fried). You sending coins to this platforms only means you're giving up the ownership of your coins for some APY that mightn't be worth it due to the whole market dipping in price.

Yes whether centralised or decentralised, once you stake any token you automatically lose ownership of it until it is removed from stake again. Even some staked tokens using Dapps do not even get released immediately you requrst for them to be returned. There is an interval of days before that happens. Within this interval anything can go wrong and you lose the whole tokens, or when the price dumps badly. Staking is not a pleasant thing to go into even when you think the percentage or APY is great.

[libert19]

I have been tempted several times from ethereum/bsc yield platforms — bsc is notorious for scammy ones, however each time I hold myself and later be glad that I didn't bother with them when they get hacked or something.

Although, I have put some into osmosis's reputed pools, been doing fine.

[cryptoaddictchie]

These "fools gold" are rampant in the altcoins/tokens they are all the same sharing the same ideology but at the end of the day, they just disappear leaving their investors in the air hanging with lots of losses.

Actually thats the thing there are no difference on concept on these staking. Maybe if they are gonna tweak a little those scary APY down to something safe then maybe. I am watching certain protocol called sandclock (quartz) and they got a unique way to handle APY. Maybe others could check how their protocol works.

[Frankolala]

Centralized systems are there to give people false hope by deceiving them with high APY just to lure them into using their platform, so that they can take advantage of your funds. This year's lesson has taught us so much that we shouldn't trust any exchange and some platforms that claims to be decentralized in disguise but are running centralized system.

Only bitcoin can face and stand any circumstance around it because of its decentralization, it should be our crypto investment and nothing else because it needs no third party for any APY thing,volatility controls that. Fuck the centralized system since they have brought pain to investors in the cryptospace this year,only greedy people will fall for them again.

[EarnOnVictor]

Thanks for this warning, I am sure that it would do many people a favour. I have been careful of many projects in the crypto space, I don't even look at the side of the new tokens anymore no matter the name of the project. One has to be very careful these days that individuals and companies are using legit means to scam.

Anything aside from BTC and ETH is an abomination to me now, I will always do my investment, trading and calculation around the two.

[JunkieMiner]

In a sense you are right brother, keeping money in an centralized areas. projects can't be a wise solution because the better way of investing this money is to invest and use it in the trading of your own choice, may be daily or it can be long term of the person's own choice, otherwise the APY will give higher risk of loss.

[o48o]

There are many projects asking investors to stake their tokens for APY but they collapsed later for example Midas, they offered 17% APY on USDC, the token went from 38$ to 0 and their swap feature is shut down..
-cut-

That's why many people wanted this while scene to get regulated. Now that crypto is going to be regulated it seems to be a surprise that most of the freedom and pseudonymity is gone.
But that's what we ordered; less scams and more regulations. And regulators gonna regulate way more piercingly then people originally thought.

But anyone with a brain couldn't believe that promising 17% APY on FIAT MONEY based tokens isn't something they could promise. Even if that would be sustainable for a while they couldn't know about the market situation in the future, so promising something like that makes me think that they didn't have their own a lawyer to advice them.

[_morghulis]

There are many projects asking investors to stake their tokens for APY but they collapsed later for example Midas, they offered 17% APY on USDC, the token went from 38$ to 0 and their swap feature is shut down..

Once I see that a project's apy is just too God to be true I don even bother myself with it. Because most times they just use it as a bait so that they can attract many other investors and at the end they will run away with investors funds.

[Yatsan]

Thanks for this warning, I am sure that it would do many people a favour. I have been careful of many projects in the crypto space, I don't even look at the side of the new tokens anymore no matter the name of the project. One has to be very careful these days that individuals and companies are using legit means to scam.

Anything aside from BTC and ETH is an abomination to me now, I will always do my investment, trading and calculation around the two.

Staying on big names of this industry would be a safer investment especially at the present wherein there's no clear sign of recovery and no one's certain of when will such thing occur in this industry. There are new projects which are promising but if you cannot afford risking an amount to the new ones, that is just fine but if you do, take time to think of which is which. All I know is that if bearish trend is dominant, no matter how good a project is, it won't be able to assure success on its outcome because it will have a high tendency to be pulled down by the market situation. I am also not saying that huge names of this industry are safe from it but atleast they'll behaving bigger chances to recover.

[CryptoYar]

Stay away from such projects which give high APY.

Rules: Supply and Demand.

They get people to stake tokens by luring them with high APY, then the circulating supply of tokens decreases in the market, and the price of the token shoots up. (since the supply is less and demand is high... Demand is high because more and more want to take advantage of this High APY)

But when the unlocking/unstaking of tokens starts the price starts to drop. (people will have more tokens than before, yet they are at loss because the value of tokens is very low).

[Silberman]

There are many projects asking investors to stake their tokens for APY but they collapsed later for example Midas, they offered 17% APY on USDC, the token went from 38$ to 0 and their swap feature is shut down..

I am just trying to warn you about Centralised Finance tokens and platforms, avoid taking big risks with CeFi Platforms.

APY can be tempting at times, powerful enough to make you turn your back on the vital parts of the project, do not compare APY of a CeFi project with others especially when the project is not that popular.

Now that we are even in a bear market, any projects offering high yield is a big red flag, this is not the time to focus on earning rewards.

While a little bit late I consider it is important that people are finally learning this lesson, no one can offer such profits and remain in business for long, not even the best money managers in the world would dare to offer and guarantee such high level of yearly profits, and when that is the case you know there is something really fishy going on, after all look at what banks offer and you will find that those offers are in single digits and in many cases they are below 5% per year, so it is almost a given that anyone offering more than that is a scammer.

[blockman]

Those projects or platforms that do offer high APYs, they'll eventually go down when there are bunch of people started to invest and stake their required cryptocurrency there.
But for me, I'll just avoid those high APYs because they're not really sustainable especially if one of the requirements is to lock your asset on that platform, cefi or defi.
That's already a red flag and that's going to be a better thing to look at when someone is new to it.

[klidex]

Stay away from such projects which give high APY.

Rules: Supply and Demand.

They get people to stake tokens by luring them with high APY, then the circulating supply of tokens decreases in the market, and the price of the token shoots up. (since the supply is less and demand is high... Demand is high because more and more want to take advantage of this High APY)

But when the unlocking/unstaking of tokens starts the price starts to drop. (people will have more tokens than before, yet they are at loss because the value of tokens is very low).

I agree with you and that's exactly what happened.
Coin owners take advantage of investors and traders to take their own profits with large amounts.
Incidents like this happen more often in micin coin projects or you can say fake projects.
After several large investors enter and the coin will be released on the market, the owner and developer have first sold all the reserve coins they have stored or the owner can also buy his own coins with a larger amount than what the investor holds, then when the release is released the price will increase and the owner sold everything making the coin beat the price drop drastically.

[len01]

in this situation there are so many altcoin projects that offer high APY and it's actually like a trap that lures investors into the trap after which they will just walk away. this kind of incident actually happened a while ago like Terra offered high APY and after that they left the project.
but incidents like this are sometimes ignored by some investors. they only think about big profits when the market is bearish. even though when the market is being attacked by bearish it is a difficult time to get big profits, except patiently investing in bitcoin.

[pawanjain]

That is very true. Many altcoin projects have collapsed in bear markets.
I say this because I have seen coins performing well literally go to zero in bear markets.
Matter of fact I had invested in Solana  because of its potential growth and good APY.
But the recent events made me unstake it and sell it for a loss. I had to cut the losses else we can see how low it is currently.
I guess there are no better coins than bitcoin and ethereum afterall.
Short term investments in bull run + long term investment in bitcoin should be our strategy now on.

[coin-investor]

Now that we are even in a bear market, any projects offering high yield is a big red flag, this is not the time to focus on earning rewards.

I don't think so, it's on the platform and the community support I invested in two casino-based tokens with APY as high as 35% and the two tokens are doing good, we should not generalize even in the bear market there are exceptions to the rules that altcoins with high APY are bad to invest, these two tokens were doing great in the bull run and they retain their momentum when the trend shifted to bear market.
We should check the platform, community support, and reputation of the team, and still be wary of new tokens with high APY without a platform that has usability and can serve the community.

[Lantind]

There are many projects asking investors to stake their tokens for APY but they collapsed later for example Midas, they offered 17% APY on USDC, the token went from 38$ to 0 and their swap feature is shut down..

I am just trying to warn you about Centralised Finance tokens and platforms, avoid taking big risks with CeFi Platforms.

APY can be tempting at times, powerful enough to make you turn your back on the vital parts of the project, do not compare APY of a CeFi project with others especially when the project is not that popular.

Now that we are even in a bear market, any projects offering high yield is a big red flag, this is not the time to focus on earning rewards.

Indeed it becomes a risk when staking tokens on new sites. If they fail to sustain the project, they will eventually have to close the site. I think we can stake coins on trusted sites, Binance also provides a staking program. Even though the APY percentage is low, you are doing it on a site that has high trust.
So we shouldn't get stuck with the APY percentage offered by them. If a new project still has a high probability that the coin price of the project will drop, even the highest risk is the project dies.

[fullhdpixel]

That is very true. Many altcoin projects have collapsed in bear markets.
I say this because I have seen coins performing well literally go to zero in bear markets.
Matter of fact I had invested in Solana  because of its potential growth and good APY.
But the recent events made me unstake it and sell it for a loss. I had to cut the losses else we can see how low it is currently.
I guess there are no better coins than bitcoin and ethereum afterall.
Short term investments in bull run + long term investment in bitcoin should be our strategy now on.

All cryptos including Bitcoin can collapse in a bear market but top cryptos won't just go to zero. I think the ones that you are talking about are coins similar to meme coins and pump and dump coins. These shouldn't fool you thinking they are a good project just because you saw their values rising.

It only rise because they are heavily promoted and they sometimes promise investors that they will earn a nice return in a short period of time. We know they are only lying when they say that but there are still newbies who will bait on it. I think Solana is different from it but Solana is one of those great projects that one must keep for long term. You should have waited before selling at a loss.

[crwth]

Would this be applicable with the banks that are for high APY as well? Because I think that’s just a enticing factor to which banks are giving in order to keep your money in them, and then making you a source of money for them which is what usually banks do.

I think it is definitely a red flag when it has a high APY, and the project is somewhat sketchy

[Xal0lex]

There are many projects asking investors to stake their tokens for APY but they collapsed later for example Midas, they offered 17% APY on USDC, the token went from 38$ to 0 and their swap feature is shut down..

I am just trying to warn you about Centralised Finance tokens and platforms, avoid taking big risks with CeFi Platforms.

APY can be tempting at times, powerful enough to make you turn your back on the vital parts of the project, do not compare APY of a CeFi project with others especially when the project is not that popular.

Now that we are even in a bear market, any projects offering high yield is a big red flag, this is not the time to focus on earning rewards.

Almost any staking in a bear market is unprofitable, be it CeFi or DeFi. It doesn't matter which platform. At such times, tokens fall in value much faster than the staking reward accrue. In the best case, the staker will cover losses related to the drop in the price of the asset if he or she did not buy on the bull market.  It has been said many times before about high-interest staking, all this is a scam, slowed down or fast-acting. Sooner or later such platforms close or reduce rewards.