Have you ever heard the term "DeFi" thrown around in conversations about cryptocurrencies and blockchain technology? If you've felt a little lost or confused by this new buzzword, you're not alone!

In this blog post, we'll demystify DeFi and explain why it's becoming increasingly popular in the world of next-gen finance.

DeFi, short for Decentralised Finance, is a movement that aims to revolutionise the traditional financial system by leveraging the power of blockchain technology. DeFi allows people to access financial products like lending, borrowing, and trading without the need for intermediaries such as banks or financial institutions.

At its core, DeFi is built on smart contracts – self-executing agreements that run on blockchain networks like Ethereum. These smart contracts enable the creation of decentralised applications (dApps) that provide a wide range of financial services, such as decentralised exchanges (DEXs), lending platforms, and stablecoins (cryptocurrencies with a value pegged to a stable asset like the US dollar).

So why is DeFi gaining traction? There are a number of reasons:

**Accessibility:** DeFi platforms are open to anyone with an internet connection, which means that people in developing countries or those with limited access to traditional banking can now participate in the global financial system.

**Transparency:** With all transactions recorded on a public blockchain, users can easily audit the platform's operations and ensure their funds are being handled responsibly.

**Control:** DeFi users maintain full control over their assets and can interact directly with smart contracts, eliminating the need for middlemen and reducing fees.

**Customisation:** Users can create their own financial products or services by combining various DeFi building blocks, opening the door for innovative solutions that cater to individual needs.

In short, DeFi is transforming the way we interact with financial services by offering a decentralised, transparent, and inclusive alternative to the traditional system.

As the technology continues to develop and mature, we can expect to see even more exciting innovations in the world of decentralised finance, we’re looking at you NFTs!

Are you ready to [Access DeFi](https://blockearner.com.au/products/defi-access/)?

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DeFi allows people to access financial products like lending, borrowing, and trading without the need for intermediaries such as banks or financial institutions.

What is DeFi?

# What is AAVE?

Aave is a way for users to be connected to a worldwide network of lenders and borrowers in the cryptocurrency field. It’s all automated and works on a non-custodial basis, meaning you are in total control of your own wallet and where you choose to direct your cryptocurrency digital assets. 

The group take their name from the Finnish word for ‘phantom’ or ‘something unseen’. Rather than relying on traditional banking systems and brick and mortar (or maybe marble and gold) buildings, the Aave protocol is fully automated allowing individual lenders and borrowers to connect with ghost-like efficiency via the liquidity pool. As of December 2021, the total value of this pool has the cash equivalent of more than $27 billion. 

The protocol is built on the premise of lending and borrowing digital assets with in-built safety nets. This is done by employing smart contracts that automatically facilitate loan activity as well as innovative concepts such as **collateral liquidations** and **staker slashing**. Ultimately, this simply means it is very difficult to default on your payments.

In other words, join the global pool of lenders and borrowers, follow the rates as they change and watch your percent yield grow!

***Working Example***

Let’s say you want to use Block Earner to borrow or lend USDC, the digital stablecoin pegged to the United States dollar. When this transaction is opened, you receive a **tokenised** version of that loan in return. This takes the form of aUSDC, aka AAVE USDC.

When buying 1000 USDC worth of aUSDC, this is equivalent to 1000 aUSDC. The rate stays at exactly 8% all year. The final standings would be at 1080 aUSDC, which can be sold back for 1,080 USDC and then finally back to AUD. 

Anyone holding aUSDC will find their balance constantly increasing proportional with the yield rates at the time. For Block Earner users, this is updated daily. Notably, this value is guaranteed to never go negative, meaning your USDC value will never go down.

The exact details of this workflow are all handled by Block Earner’s backend, leaving the technical challenges out of your hands. All you need to do is choose your assets and let the code handle the dirty work!

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Aave is a way for users to be connected to a worldwide network of lenders and borrowers in the cryptocurrency field...

What is AAVE?

Ethereum is the world's first programmable blockchain with smart contracts, that features its very own cryptocurrency Ethereum. At its core, Ethereum is a decentralised global software platform powered by blockchain technology.  

Ethereum is the second-largest cryptocurrency by market capitalisation. However, unlike Bitcoin, Ethereum was designed to be more than just a medium of exchange and store of value. Instead, Ethereum was to be a decentralised blockchain platform that could be used by developers to create and run decentralised applications ([dApps](https://ethereum.org/en/developers/docs/dapps/)) and [smart contracts](https://ethereum.org/en/developers/docs/smart-contracts/).

# What are decentralised applications and smart contracts?

Think of the Ethereum blockchain like a decentralised app store. A platform that hosts applications that provide unique tools and experiences for customers. The Ethereum blockchain works in a similar way, software developers can build and release new products via the Ethereum blockchain network.

Launched in 2015 by programmer Vitalik Buterin. The introduction of the programmable blockchain has made Ethereum the home to thousands of decentralised applications including Decentralised Finance ([DeFi](https://blockearner.com.au/blog/what-is-defi/)), NFTs, Gaming, and the Metaverse, for millions of people.

The Ethereum market cap is over $208 billion AUD, and the [current price](https://coinmarketcap.com/currencies/ethereum/) per Ethereum sits at over $4,440 AUD as of August 8th 2022*.

![ETH Chart (8:2022).png](https://strapi-service-execution-strapibucketc6c2af7f-xqyd4w1cm74e.s3.ap-southeast-2.amazonaws.com/ETH_Chart_8_2022_fe2fa07a62.png)
*Ethereum (ETH) [Market Cap](https://coinmarketcap.com/currencies/ethereum/) 8/8/2022

# Benefits of Ethereum (ETH)

**Global finance for everyone**

Traditional finance is exclusionary. In 2017, the World Bank [reported](https://openknowledge.worldbank.org/handle/10986/29510) 1.7 billion people were “unbanked” meaning these individuals did not have adequate access to accounts or financial tools.

Decentralised finance, powered by Ethereum, is driving an alternative financial and technological infrastructure. One that is global, open source, and accessible to all who have access to the internet, regardless of nationality, ethnicity, gender, or socioeconomic class.

**The internet of assets**

Ethereum is more than just a digital currency. Today, essentially any asset can be represented, traded, and owned as non-fungible tokens (NFTs). These tokens are called [ERC-20 tokens](https://ethereum.org/en/developers/docs/standards/tokens/erc-20/) and they are minted onto the Ethereum Blockchain.

You can also program these tokens thanks to Ethereum smart contracts, and receive royalties automatically when the asset is resold. The blockchain works as an open accounting system, and enables new possibilities that are always expanding.

# How do I buy Ethereum?

Ethereum is divisible up to 18 decimal places, so you don't have to buy 1 whole ETH. You can buy fractions at a time – as little as 0.000000000000000001 ETH.

The introduction of Crypto Earner provides Australians with the simplest way to buy and earn 4% fixed annual yield on any amount (even fractional) of Ethereum and earn a daily compounding yield on their Ethereum holdings, in Ethereum. With no lock-in periods, no minimum deposit amounts, and low fees — watch your balance grow live in the app or withdraw your holdings at anytime, anywhere.

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Ethereum is the second-largest cryptocurrency by market capitalisation. However, unlike Bitcoin, Ethereum was designed to be more than just a medium of exchange and store of value.

What is Ethereum? (ETH)

Research powered by [Collective Shift](https://collectiveshift.io/) — [Book a strategy call](http://collectiveshift.io/strategy) to learn more


**Key Takeaways**

- These lull periods are a standard part of all bull and bear markets. They can be challenging and frustrating, but they are ultimately necessary.

- I expect the next month or two to be more of the same, especially because August and September are historically two of BTC’s worst months.

- The setup for Q4 is incredibly strong, in my opinion, and I expect prices to be significantly higher by year-end.


**Trying Times For Crypto Investors**

Times like these can be difficult for us crypto investors. The Nasdaq and S&P 500 have [fully recouped their losses](https://finance.yahoo.com/news/stock-market-today-sp-500-nasdaq-rally-to-fully-recoup-losses-from-august-sell-off-133436462.html) from the brutal start of August. [Gold is near record highs](https://finance.yahoo.com/news/gold-prices-soar-near-time-215330418.html).

Meanwhile, cryptocurrency prices are still well below where they were when the carnage started on August 2—BTC (-12.2%), ETH (-19.6%) and SOL (-15.3%)—and the [Fear & Greed Index](https://alternative.me/crypto/fear-and-greed-index/) has been at ‘Fear’ or ‘Extreme Fear’ for most of August.

There’s no denying that things are quiet. Many investors have become apathetic after seeing BTC bounce around in the same price range for many months, while their altcoin holdings have fallen. Some are questioning their level of conviction.

For me, I’m fortunate to have experienced several of these months-long periods of choppiness since I started investing in crypto in 2017. Regardless of whether these periods are taking place in a bull or bear market, they never fail to test you and challenge your assumptions.

**My Short-Term Outlook: More Chop**

We are in a seasonally terrible period for crypto. You can’t ignore the data.

BTC really doesn’t like August and September. Taking the median average of monthly returns since 2013, August (-8.4%) and September (-5.6%) are literally the worst and second-worst months for BTC, as per [Coinglass](https://www.coinglass.com/today). Using the mean average, August (+1.5%) is the third-worst and September (-4.8%) is the worst.

![price-performance-monthly.png](https://strapi-service-execution-strapibucketc6c2af7f-xqyd4w1cm74e.s3.ap-southeast-2.amazonaws.com/price_performance_monthly_a8c7a2d7d4.png)

Couple this with the fact there are currently no clear catalysts for crypto, and I expect more rangebound price action for the next month or two. For altcoins, I think it makes the most sense to wait for BTC to break above its months-long range.

Due to this lack of short-term catalysts, I expect macro to have a larger-than-typical impact on crypto prices. For this reason, the below dates may be of significance. (Emphasis on ‘may’.)

- **Jackson Hole Symposium (Aug. 22–24).** The [annual event](https://www.kansascityfed.org/research/jackson-hole-economic-symposium/) where the world’s central bankers convene to discuss monetary policy. These are hit-and-miss in terms of their significance.

- **Trump vs Harris presidential debate (Sep. 10).** If there is a clear winner, this debate will likely affect the outcome of November’s election. (There will be subsequent debates, but ultimately most voters will only remember the first—if any.)

- **U.S. interest rate decision (Sep. 18).** While a rate cut is all but certain, its size is still unknown. As per [CME FedWatch](https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html), a cut of 25 basis points is a 74% chance, with 50 basis points a 26% chance. As always, Chair Powell’s press conference will arguably have a greater impact on markets than the decision itself.

**Why I Expect Much Higher Prices By Year-End**

Nothing lasts forever. This rangebound price action is no exception. When I look to Q4, I can’t help but get excited for the crypto market. Consider these factors:

- [Global liquidity](https://x.com/cmsholdings/status/1823407308681982302) will have continued strengthening if the current trend holds.

- [Rate cutting](https://x.com/KobeissiLetter/status/1820795297418694817) will have started in the U.S. and continued for many other central banks.

- Accessibility to the spot Bitcoin ETFs will have improved. Other wirehouses are expected to follow Morgan Stanley, [which last week became the first](https://www.youtube.com/watch?v=5t2sgM73CX4&t=603s) to allow its financial advisors to offer Bitcoin ETFs to eligible clients. As I’ve said all year, I believe most investors are unaware of how limited access to these new ETFs is.

- Most of, if not all, Mt. Gox creditors will have received their BTC redistributions from their designated exchange. No longer will this enormous balance of ~142K BTC (~$8.3B) weigh on the minds of crypto investors.

There are some wildcards, too, such as November’s U.S. election and the possibility of regulatory progress in the U.S.

As for my outlook for beyond 2024, I expect the peak of this cycle to happen around May or June. Of course, this is subject to change based on a long list of variables. It makes zero sense to ignore these variables.

By this stage of 2024, BTC would well and truly be in the window where it typically hits its cycle high. (Of course, last cycle was an exception, and there are other reasons I’d never rely on this stat at the exclusion of all else… but I still think the below chart from [_checkonchain](https://charts.checkonchain.com/btconchain/technical/technical_epochcycle_price_0/technical_epochcycle_price_0_light.html) is a useful visualisation.)

![bitcoin-index-halving.png](https://strapi-service-execution-strapibucketc6c2af7f-xqyd4w1cm74e.s3.ap-southeast-2.amazonaws.com/bitcoin_index_halving_4ed6aa9388.png)

**Recap**

These lull periods are a standard part of all bull and bear markets. While I expect this choppiness to persist for another month or two, the setup for Q4 is incredibly strong, in my opinion. For this reason, I still expect prices to be significantly higher than year-end.

If you enjoyed these insights, make sure to [book an intro strategy call](http://collectiveshift.io/strategy) with our research partners over at [Collective Shift](https://collectiveshift.io/).

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These quiet market conditions can frustrate even the most experienced crypto investors. In this post, we break down how we're seeing things and why we still expect a very strong ending to 2024 for crypto.

Survive Q3, Thrive In Q4

Research powered by [Collective Shift](https://collectiveshift.io/) — [Book a strategy call](http://collectiveshift.io/strategy) to learn more

**Key Takeaways**

- Selling the top is extremely difficult.

- Manage your expectations of what is achievable when it comes to selling.

- If you sell within 15% of the market peak, history suggests that it is an amazing outcome.


Everyone calculates how much money they’ll make when they sell at the top. “When the price goes to $xyz, I’ll have $abc money and life will be great.” But how do you actually sell the top? Remember, there is actually only one trade at the top. One buyer, one seller. That’s it! So, guess what? It’s probably not going to be you.

So, realistically, what can you achieve when it comes to selling the top?

Let’s use [Bitcoin](https://blockearner.com.au/buy/btc/) (BTC) as the example looking at 2021 top of $69,000. You’re probably thinking, “If I can get within 5% of the top—or $65,550 (green line below)—I’ve done well.” I have some bad news for you: you’re simply not that good! Last cycle, BTC’s price spent just three days above $65,550. Yes, three! You had only three days out of the entire four-year cycle to nail it within 5% of the top.

What about 10% from the top? A price of $62,100 (red line below)? The price closed above this only 16 days of the entire cycle. Again, how good do you think you are?

What about 15% from the top? A price of $58,650 (purple line below) There were 33 days that the price closed above this. Maybe now we’re starting to see what we can realistically achieve. If you get 15% from the top you have done amazingly well. Of a cycle that is 1,461 days long (i.e. four years, with one being a leap year), you have one month to sell 15% from the top.

![bitcoin-1024x583-1 (1).jpg](https://strapi-service-execution-strapibucketc6c2af7f-xqyd4w1cm74e.s3.ap-southeast-2.amazonaws.com/bitcoin_1024x583_1_1_52fdd0b29a.jpg)

Let’s take a quick look at [Ethereum](https://blockearner.com.au/buy/eth/) (ETH).

ETH topped at $4,870. So, 5%, 10% and 15% is $4,626, $4,383 and $4,140, respectively.

5% from the top you had five days to nail it.

10% from the top you had 20 days.

15% from the top you had 39 days.

 ![eth-1024x583-2.jpg](https://strapi-service-execution-strapibucketc6c2af7f-xqyd4w1cm74e.s3.ap-southeast-2.amazonaws.com/eth_1024x583_2_c09ae1f484.jpg)

Are we seeing a pattern?

Finally, let’s look at [Solana](https://blockearner.com.au/buy/sol/) (SOL).

Top of $260, we are looking at $247, $234 and $221, respectively.

5% from the top you had three days.

10% from the top you had 10 days.

15% from the top you had 15 days.

![sol-1024x583-1.jpg](https://strapi-service-execution-strapibucketc6c2af7f-xqyd4w1cm74e.s3.ap-southeast-2.amazonaws.com/sol_1024x583_1_7ed98b9026.jpg)

So, in summary, selling the top is a myth. If you sell within 15%, history says you’ve done incredibly well. Adjust your expectations and your thought processes accordingly. For example, if you think BTC can hit $200,000 this cycle, consider setting your sells for $170,000 and be happy taking profits.

If you enjoyed these insights, make sure to [book an intro strategy call](http://collectiveshift.io/strategy) with our research partners over at [Collective Shift](https://collectiveshift.io/).




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Every crypto investor wants to sell the top, but is this really achievable? Let’s take a look at prior market cycles to see how realistic this is.

What Selling the Top Looks Like

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What is DeFi?

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What is Ethereum? (ETH)

Survive Q3, Thrive In Q4

What Selling the Top Looks Like

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