Decentralized Finance (DeFi), is poised to long-term growth and value accrual. It has already proven its worth as a better alternative to traditional finance (though there is still much work). According to DeFi Pulse (an analytics website and DeFi aggregator), relevant protocols have a cumulative value currently of $14.8B and it shows no signs of slowing down.
DeFi Protocol
It’s not difficult to see that DeFi protocol investments have proven extremely profitable for people. One, there are many DeFi protocols. Every day, new protocols are added to existing protocols. This means there are many options, but not all DeFi protocols are the same. Profitable investments in these protocols require careful vetting and analysis of the risk/reward ratio. This is not an easy task. What if there were a way to allocate capital to many blue chips in a 1-Click DeFi investment method? Index funds are a good option.
DeFi Pulse Index
DeFi Pulse Index powered By Token Sets is a well-known index fund that allows 1-Click DeFi investment. It holds multiple blue-chip DeFi protocol tokens. The weight-age (or percentage) of each token is determined by the token’s circulating supply. The DeFi Pulse Index’s most important feature is its inclusion criteria. This is extensive and complex.
It evaluates tokens according to their nature, supply, future predictability, team response to any incidents and liquidity. So users can be sure they are getting the best. The DeFi Pulse Index’s status is continuously monitored and updated to reflect changes in the market. Visit its official page to learn how you can invest.
Power Index
The Power Index, a collection of index funds, is the second and more recent. There are two versions: Yearn Ecosystem Token Index YETI and Power Index (PIPT). The first is the classic collection of well-established DeFi protocols, while the second is for newly launched projects with great potential. Yearn Ecosystem Token Index targets more adventurous investors who are more conservative and have a moderate risk appetite.
Power Index includes assets such as AAVE, SNX and SNX, CVP and COMP (all based on 12.5% weightage or a percentage of the total fund). Yearn Ecosystem Token Index includes assets from the Yearn ecosystem, which is led by Yearn Finance, a flagship-grade project of DeFi. These include YFI (35%/17% weightage respectively) at top. The remaining assets are CREAM and AKRO, COVER KP3R CVP, CVP, and PICKLE (all at 8%-weight-age).
Conclusion
You can find Yearn Ecosystem Token Index and Power Index here. The 1-Click DeFi interface allows for easy investments. It shows the token percentages, wallet overview (assets in the fund), and offers the option to buy directly through ETH or by supplying multiple assets to the pool. Both indexes offer the option to stake in multiple pools for passive income, and the redemption option to convert index fund tokens back into Ether (ETH).