Many centralized crypto exchanges launch various financial products, then how to choose right products to minimise the risk and maximise the profits?
Today we will compare three crypto exchanges with a relatively large number of users to help you make your own decisions.
These three crypto exchanges, namely AEX, Lbank and Gate.io, have more than millions of users globally with a daily trading volume of 1 billion dollars or so, and all have operated for quite a long time.
First of all, let’s see what financial products are involved respectively in each exchange:
AEX’s Savings module is the most comprehensive one. The existed products in the Savings module include many functions and coin types; the recently released Dual Investment is very distinctive and provides higher profits than other exchanges. The next one is Gate.io with some regular functions such as HODL & Earn, Crypto Lending, Auto-Investment and Structured Products, while Lbank issues fewer products such as Locked mine and Flexible mine.
Due to the variety of financial products, we can compare the profits, risk, and operation of these products to make the best choice.
Earnings comparison
The above-mentioned crypto exchanges involve flexible and fixed finance.
Flexible: freely join and withdraw incomes at any time.
Fixed: positions will be locked until the fixed term is reached
Considering the diversity of coin types and high price fluctuation of low market cap coins, we take BTC, ETH and USDT as examples.
Fixed finance and flexible finance are the most common strategies for managing your assets. AEX provides multiple periods for users to choose from and set a low threshold for participation. Users can choose to transfer their bonds for early redemption if necessary in AEX’s Fixed Savings
It is worth mentioning that AEX offers an exclusive benefit for novices that beginners can enjoy an APR of up to 60% in BTC, USDT, ETH and USDC programs. From the perspective of the annual percentage rate, AEX is the most recommended for those who are committed to holding dominant coins.
And the recent DeFi Pool can provide an APR of 8.8% in BTC, 8.8% in ETH, 13.5% in USDT, and 12.5% in USDC, with a 10-day lock-up period.
The Flexible term of Gate offers a lower APR than AEX, but the Fixed term offers only a 7-day lock-up period which is more suitable for short term finance
Lbank simplifies its finance with only Flexible earn included, but the APR is higher than the other two.
Dual Investment
Dual Investment is a structural financial product that does not guarantee the principal but provides high incomes, and the income will be settled in one of the two coins. It provides floating profits--which means the profit will be adjusted according to the so-called “strike price”.
The crypto market is on the direct impact of the constitute fluctuation of the value of the assets. The dual currency financial product uses this feature by investing a specific coin to achieve the predetermined standard to earn profits. When missing the standard, it will provide different profits in an alternative coin.
For example, if you subscribe to an underlying in the dual investment with BTC, the settlement currency may be BTC or USDT, depending on the settlement price. When the settlement price is higher than the strike price, you will earn USDT; if the settlement price is lower than the strike price, you will earn BTC.
By now, Gate.io has only two coins, BTC and USDT, for users to subscribe to in its Dual Currency Product. AEX provides multiple underlyings in its Dual Investment such as BTC, ETH, EOS, DOT, DOGE and FIL. And Lbank does not have dual currency financial product yet.
No matter in AEX or Gate.io, the dual currency investment can offer high incomes. But it can’t replace deposits or fixed savings because it doesn’t guarantee your principal. The risk of principal loss exists for the final earning is under the influence of the market conditions. Therefore, we need to understand the related risks of the dual currency investment beforehand fully.
Hope this article can help you make the right decision in dual currency investment.