My question is that if anyone takes a loan at around 10 - 12% interest rates and invest in stablecoin pair to earn a decent 16 - 18% APY interest on various platform. Now there is a margin of 4 - 5% to earn. Is it possible in reality? Because many factors are working here.
- First of all, there is always a risk of hacking the platform, seeking higher APY, many users invested in small pools, where there is a always risk.
- The rates fluctuate regularly (every 3/15 seconds).
- Have a change to rug pull.
Despite all factors, is it will be profitable to follow this way, 'take a loan from one place and invest in another for getting higher APY %
Although the APY % is very low, investing a large amount could bring a large APY.
Can any one earn like this? If yes, what things need to remind before investing?Possible in theory. You've already mentioned the factor of being hacked and you don't hold the keys into those centralized platforms where you'll stake it.
And then the rates will changed over time, trust me I've observed many of them that are like 10%-12% but then dropped eventually.
The reality of these staking and stable coin farming is that it isn't sustainable. That's why if you're intrigued and trying to pursue this then be prepare for the worst or better not do it.