A 15% interest rate account seems like a dream in today’s economy, but not in the world of the blockchain. The blockchain proposes a variety of ways for a user to maximize their savings and gain real interest in their savings. One way is for the user to deposit idle tokens into DeFi products that sit on the blockchain and to put them to work externally in return for passive yield for the investor.
One example of this is San Francisco-based Gluwa which was founded in 2014. The firm offers a range of DeFi products to users including a non-custodial cryptocurrency wallet, an exchange, and traditional type investment products that take advantage of the blockchain for enhanced interest rates. This blockchain-based platform which features downloadable apps for both Android and Apple has generated nearly $2 billion in funding so far. It uses these investor funds to merge cryptocurrencies with real-world business investments, whereby a user can deposit funds into a Fixed Interest Account for one year, see the funds invested in businesses in underdeveloped or developing countries and bring a mammoth return of 15% APY to the investor.
DeFi Bridging Crypto With Real-World Financing
This proposition sits at the heart of decentralized finance, bringing unparalleled investing opportunities to the user, removing the bank, all while bestowing financing loans to worthy businesses that can often not participate in regular off-chain financing.
In the latest fundraising round, the platform is democratizing investing by allowing anyone anywhere to deposit into their account, up to a cap of $250K from a low minimum deposit, and to seek generous yield at the end of the account term of 12 months. Users, as with traditional Fixed Term accounts, must leave their funds inside the Gluwa account until account maturation.
Unlike with traditional savings accounts, where users nowadays are lucky to generate interest above 1%, with Gluwa, users deposit their crypto coins and stablecoins into the account. These are converted into stable Gluwa tokens (sUSDC-G), a Gluwa-native wrapper over the USDC stablecoin, and are then dispersed through Gluwa’s financing partner Jenfi to third-party borrowers, those that need it the most.
To incentivize its users further, Gluwa has promised to match the end of term interest with the same amount in $CTC coins. So for instance, if the account generates $200 at the end of the term for the user, he will also be bestowed with an extra $200 of CTC tokens.