Do you think I am someone who is easily influenced by others while making critical financial decisions?
Yes. I am 😛
I have been reading these Bear Market strategies posts @khaleelkazi has been publishing in the last two months or so. No matter how hard I tried to not get influenced by those posts and strategies, I could not resist. To be fair, he made some good points about leveraging and making your assets work in the bear market. That is also true if you do not want to sell your crypto assets anticipating big moves during the upcoming bull market. Whenever that is.
What did I do?
Borrow on AAVE
I do not have a sizable chunk of Bitcoin that can fund the amount of money I wanted to bring to Hive. So, I used my $MATIC and a few other assets to use as collaterals on AAVE. I was pretty conservative with my collateralization as I have only used 10-20% of the total value I could borrow. It is fun to be your own money manager.
The platform has an option to choose between the variable and fixed interest rates. I went for the fixed interest rate of 5% while borrowing a stablecoin. That means the 20% apr on HBD is a 15% profit for me without having to worry about the variable interest rate. That’s a nice feature the platform implemented for borrowers.
The borrowing and lending process is super easy on AAVE. I chose AAVE because of its reputation and the stability it has with its money market. It is ideal if you are traditional with your risk taking as you do not want to be putting your money at risk. That way, you have time to repay the debt if the market goes crazy and spirals down putting your collateral value at risk.
I may also need to be aware of the market and check back the borrowing status on the platform regularly. I will be able to do that - no problem.
I then transfer the asset to Hive
This was the trickiest part for me to be honest. I thought I was savvy when it comes to transferring assets across chains and I was wrong. I was not much active on DeFi platforms in 2022. Things are almost the same when it comes to multichain transfers after almost two years. I did not have a clue how I would transfer stable coins to the Hive chain.
Cubdefi uses pancakeswap for stable coin conversions
For me, the easiest route would have been converting USDT to BUSD and then to bHBD on Binance Smart Chain. I tried the swap but the conversion rate was pretty bad. I am not sure what’s the reason behind not getting 1:1 swap or even close. I got a 1: 0.94 swap for bHBD. For that reason, I decided to not swap the stable coin directly but use a centralized exchange to buy $HIVE and then convert to HBD.
Simpleswap was the refuge
I used simpleswap. I had to create an account and use their swap function. The process is smooth if you know how to send stablecoins to another address using crypto wallets. I think I can use the platform again if needed. Impressed with the performance.
All in all, I managed to transfer my assets into Hive but it was not the smooth sailing that I was hoping for. Not sure if I should have done things differently for an easier and smooth transition. Let me know in the comments if you think there is a better way to bring in assets to hive without using a centralized exchange and without having to convert assets to hive or BTC.
Sweet 20% APR
The best part of all this hassle was when I transferred the converted HBD into my savings account for the sweet sweet 20% interest. I will be making 15% profit should the HBD interest is constant at 20% as the AAVE borrowing rate is fixed at 5%.
I need to figure out how to take my stablecoin out of Hive without having to exchange it for Hive. For now, I am okay with HBD in my savings account.
This is me taking advantage of ideas and strategies shared on @leofinance community. This is not financial advice but just a monologue of my most recent defi endeavor.