Many have realized that on the road to achieving real and long-term financial freedom, earning passive income is a way to make an investor’s fortune work for them. The bottom line is that once the revenue stream completes your revenue, users can retire earlier and have more time to explore their passion.

In the past, financial freedom was mostly for those who reached retirement age and worked in stable jobs with stable income, as they gradually began to save and invest their wealth in long-term investments for growth over 40 or 50 years. Although this model is not obsolete yet, the DeFi world has since introduced alternative ways to achieve the same result – financial freedom. It can be a fraction of the time.

Since then, interest rates on traditional savings accounts have fallen, making the concept of decentralized finance or “DeFi” more attractive than ever. With the elimination of intermediaries and the offer of more lucrative opportunities for investors, there has also been an increase in the demand for increased influence and the associated annualized return (APY). As a result, by fixing money in a smart contract instead of a bank, any user can receive passive income beyond the standard 0.5% offered by the bank.

With the use of new platforms and other earning opportunities, investors now face a new challenge in optimizing returns. While some resort to switching between networks and platforms in pursuit of the highest returns, others resort to influence.

To demonstrate this benefit to investors, the Alf protocol appeared on Solana Chain (SOL) as a way to allocate capital and provide liquidity to users and grow crops. Through the use of these protocols, Alf has shown margins of up to 200x when users engage in both short and long positions and cultivate liquidity pool (LP) returns.

A way to look for risk and avoid risk
In practice, crop farming exists as a process where users can receive financial incentives through their participation in the smart contract-based liquidity pool, where many investors have so far earned. The difference is evident in the ability to borrow chips to increase the user’s position in the yard and get proportionally more income.

For example, if a user deposits a return on a certain amount, they can expect an amount that is proportional to the inventory. But if they borrow, for example, 5 or 10 times the amount, they will earn 5 to 10 times more. Leveraged farming is becoming a strategy where users can deposit collateral, use loans against them and use them for profit. The main advantage is that due to the increase in profits, wise use of influence can help users achieve significant profits in a neutral or bear market.

It then brings the protocol to life by introducing its own Fixed Automated Market Maker (AMM) protocol method. His key contribution is the protocol for LP plots in plant production and AMM pools. To improve capital efficiency and make the market more liquid, Alf connects investors looking for less risky and less labor-intensive positions to provide liquidity to credit protocols with those investors who are looking for more risky and probably more profitable positions and are interested in more active management. . . role.

Read more about the ALF protocol here
As shown in the model, a risk-averse investor can invest capital in Alf’s liquidity pool, which can be used internally by AMM to generate basic returns for agricultural incentive loans – with two complementary protocols highlighted by LLM, AAlf Collateralized Loan Service. and AlfMM, a decentralized exchange service. Alternatively, they can benefit from high-yield farming, such as quick loans or other leveraged positions, as part of a leveraged portfolio model that will involve a risk-averse investor.

The project itself is already under development and has a fully signed development contract.

We are waiting for the release of MVP
Together, these protocols will provide investors with entry points to trade and provide liquidity when earning passive income on the journey towards financial freedom. Over the next year, the team shared their plans to fully develop and launch an MVP on the main network.

Source: CoinTelegraph