by Analytics Insight
March 23, 2022
EverGrow coin and Compound, both offer roadmaps for passive income generation in a way that new investors can easily understand
The world of decentralised finance (DeFi) took a hit in March 2022. Andre Cronje – often called the Godfather or Architect of DeFi – announced his departure from the space and the cancellation of 25 applications including Yearn Finance and Keep3r.
Yearn Finance in particular is a blow for investors wishing to make passive income from crypto without too much complexity. The DeFi service facilitated easy access into crypto mechanisms like yield farming. Without Cronje behind Yearn Finance, there’s a chance for newer projects to change the game of crypto passive income.
Two of these projects are EverGrow Coin and Compound. Both offer roadmaps for passive income generation – and in a way that new investors can easily understand. In this article, we’ll examine how Compound uses lending and borrowing services, and EverGrow Coin distributes profits and pays rewards, to achieve this goal.
What is EverGrow Coin (EGC)?
EverGrow Coin launched in September last year with the aim of becoming the number 1 crypto for passive income. Its first innovation to DeFi was to pay out daily stablecoin rewards financed by a tax on EGC transactions. Whereas many rewards projects pay investors in a native token, EverGrow Coin has paid over $35 million to date in Binance USD which is pegged 1-to-1 in price to the US Dollar.
Next, EverGrow Coin began rolling out a suite of applications designed to generate profit. Two of these will drop this March 2022 – one is Crator, a crypto-integrated content subscription service, and the other an NFT marketplace that allows borrowing against digital assets as collateral. Both of these are groundbreaking in their own fields.
EverGrow Coin chairman Sam Kelly, an investment professional, has explained the idea behind building an ecosystem that generates ‘positive volume’ even when the market is down. The profits will be redistributed either as 100% BUSD rewards for investors or used to buy up EverGrow Coin and send it to a burning wallet to drive up prices. The latter purchases will still include an 8% tax, so investors still see returns from coin burns.
What is Compound (COMP)?
The compound is another DeFi project offering a chance to make passive income from crypto. Instead of earning rewards, Compound lets you earn interest on your deposits – currently up to 3.3% APY.
The Compound app connects to your crypto wallet and offers several pools, like Dai, Ether, Tether, Aave, or Compound. The tokens you choose to deposit will determine the APY you earn.
When you deposit tokens to a Compound pool, you receive cTokens in return. You will later use these tokens to withdraw your underlying assets. Over time, your cTokens grow in value meaning you redeem more crypto than you initially put in. Returns are financed by interest paid on over-collateralized loans to other Compound users.
The easiest way to make use of passive income with Compound is through interfaces like Coinbase Wallet that allow for instant deposits within the app.
The benefit of Compound is the ability to earn interest without much complexity, without having to negotiate interest rates, and with permissionless access. However, if your investments aren’t in stablecoins you still run the same risks of price volatility as regular crypto.
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