100% 600% 4000% APY But is it really possible to get returns like this? Let’s cover some absolute degenerate passive income strategies that claim to earn you over $100 a day, and I will put them to the test personally by putting my own money on the line so you don’t have to.
And before I continue, I need to say if there were any video where it’s important for me to remind you that this is not financial advice. This is it. Even if a project seems reputable, you still have the risk of bugs and smart contracts or hacks in the network. This is especially true with brand new projects. Now let’s jump in. I found a new lending platform with extremely high APYs perfect for this experiment.
This is a new protocol, so I consider it to be very high risk. They say it’s built for two kinds of people, those who don’t have a lot of capital to invest and those who don’t have the time to master DeFi. They allow people to set up investment pathways that anyone can buy into. And it’s not unlike a hedge fund where you give a manager dollars and then they invest your dollars into other things for you.
One of the highest yield farming opportunities here takes USDC and claims to earn 27,000% APY. Then if I click on the farm and scroll DAOn, I can see exactly what the farmer is doing with this money. They’re taking your USDC tokens over to SushiSwap.
They’re swapping those tokens for Klima tokens and then staking it on a DAO called Klima Finance. I looked into this project on Medium and it launched only back in October, so it’s very new.
Klima is a fork of another DAO that we’re going to talk about in a minute called OlympusDAO. Now, I would personally never invest in something this risky, but my alter ego Sure, I’ll throw $200 into this. It’s just cash. What do I care? I mean, I wouldn’t mind an extra $200, but anyways, the goal of this DAO seems interesting enough to accelerate the price appreciation of carbon footprints.
They have a large Twitter following and I even found them featured on markcubancompanies.com. If the returns stayed this high for a year, the $200 that I threw in would turn into $58,200 in one year or about $158 a day.
But remember, because I would be earning interest on interest over time, my gains would be much lower on the first month, only $120 in gains month one, despite over $50,000 in gains after a whole year. Also note that there are other factors at play here. First, if the price of the token decreases, I will make significantly less money or even lose money altogether.
Second, the advertised returns will decrease over time. So in one year from now, they will not be offering 29,000%. Chances are in one week from now they won’t even be offering that, meaning I will make less money. Many of these projects are a bit unrealistic in how they advertise.
So again, I can afford to run this test and potentially lose money because I get to make content out of it. Whether I make money or lose money, I will still be able to tell the story. So there’s a difference here. Now, if you’d like more grounded and frankly better moneymaking tactics and additional content, you can check out my Patreon linked in the description.
There’s a reason why we have more than 10,000 satisfied members. 29,000% APY, this wasn’t even the highest APY on this site. 70,000% is for the $TIME token. My gut reaction when I see something like this is this is obviously a scam or some kind of Ponzi, but I did research into what the $TIME token is to see if this was a scam or not.
TIME, the token for Wonderland DAO is a fork of another DAO on Avalanche called Olympus. The reason Wonderland is able to offer these insanely high returns is because they’re not actually paying this out.
Now I’m sure you’re wondering, how do they pay for this then? The tokens are certainly real. Well, let’s say you purchase one $TIME token for $4,500. $TIME is backed by one Magic Internet Money token. It’s not pegged to that token.
It’s backed. This stablecoin is worth $1. This means anytime they mint a new $TIME token and sell it to you for $4,500, it only costs the treasury about $1, and this is how they can promise an 870X return on investment.
They are not increasing the value of your tokens by 870 times. Instead, they’re minting 870 new tokens over the course of a year and giving them to you.
That’s the promise under current APY anyways. Sure, it’s possible to make money, but you are banking on two things. First, that new people will continue to join in order to increase the treasury, and second, that the percent APY will remain sky high long enough for you to get a return on your money.
But this doesn’t mean that my alter ego won’t throw in some money for your entertainment. Let’s go ahead and hook $250 in this and see what happens. What else am I going to do? Donate to charity?
Right. Well, that was uncalled for. Before moving forward, I want to real quickly explain the difference between APY and APR. APR or annual percentage rate never changes.
APY changes because APY considers compound interest, basically the interest that you earn on interest. So again, 87,000% APY doesn’t tell the whole story because rates will decrease over time for all DAOs. So let’s say rates decrease by 3% a week.
For the sake of this example, in one year, the APY rate would be cut by more than three-fourths to 17,000%. Still a crazy number, but far lower than 87,000%. If Wonderland’s APY didn’t decrease over the first year, my return on $250 would be $217,000.
But again, that won’t happen. If the APY decreases by 3% weekly, my rewards would be equal to around $42,000. That divided by 365 comes out to about $115 a day for an initial investment of $250. That’s remarkable passive income. But there are large risks. Wonderland could get hacked.
There could be a bug in the Smart contract, or if a large number of people unstaked and sold, this could easily drop your returns into the negative, but it gets crazier because there’s another fork of OlympusDAO offering even higher degenerate returns.
Right now, their APY is approximately 24 billion%, with a total value deposit of around $14 million. But this can change at any moment. Almost 50 times higher APY than Wonderland. The team behind this DAO is anonymous, which is a bit of a red flag in my mind. However, this is pretty common with DAOs unfortunately. However, the community seems to be pretty positive with the direction that the developers are taking with this project.
Surprise surprise. The community is happy about a 25 billion% return, but still keep in mind that when the price goes up, the rates of the APY will go down. So you won’t see these billions of percent return forever.
And it’s still easy to lose money if the token drops in price. But Degenerate Max doesn’t care. Sure, $250 into this project as well, because I’m a millionaire and I simply can’t lose. Okay, that guy is seriously the worst. I’m sorry you had to see that. N
ow let’s do some calculations to see what that degenerate could make. This DAO actually has a built-in calculator that shows potential returns in dollars and in Tesla Roadsters. With about $250 now, the calculator on their site says my potential return in one year’s time is a measly $62 billion. This is certainly more than $100 a day. In fact, this would make me the 14th richest human on the planet.
But again, extremely unrealistic for a variety of reasons we’ve already discussed. The one week returns which might actually happen are $363 or about $113 in profit.
We’ll see if this happens at the end of this video. But first, we have the most degenerate passive income I could find in all of crypto, another fork of Wonderland DAO. It’s the same concept, same code, same idea, just even more insane rates.
If this doesn’t scream problematic, I don’t know what does. I don’t know how to even pronounce the APY number because it’s so large. The APY is 21 digits long, but 4 quadrillion times higher than Wonderland’s returns. I can’t even picture. I can’t picture that.
Like many DAOs. the developers are not doxxed and are anonymous, but the feedback of the community is generally positive. Again, not a huge surprise. I mean, they’re yield drunk. They actually have 60 million invested in the project already. The five day yield as of right now is 80% for five days.
Insane. That’s why I’m investing $250. Because what could go wrong? I’m only 60 days away from buying my second Lambo.
This is getting so ridiculous. If nothing changed, which again won’t happen by the end of year one, I would be sitting on more than $1 sextillion. This is going to be me. – How much does the Earth cost? I’m going to buy the entire Earth and be king – if I make that much money.
But seriously, these numbers will not happen. APY will decrease and the tokens price could tank. I can still lose money no matter how big the potential return is. And this has happened before.
Another DAO on Avalanche launched a meme coin project called Snowdog. Snowdog was another fork of OlympusDAO except it wasn’t made to be a DAO.
It was just made to be a meme coin. Snowdog took the game theory idea behind OlympusDAO and used the token mint as a way to fund their project. When the project launched, there was a five day minting period.
Users could stake their tokens after minting. Then after five days minting ended. Then on the 8th day, staking ended and the team promised to do this massive buyback of the token with the funds earned in the treasury for the mint.
So the whole Snowdog community was sitting there eagerly waiting for this giant green candle just to go to the moon on the trading chart. As the Snowdog team promised, they promised that they would use their entire treasury to buy back the token until it was empty.
$44 million. But then something happened. Reports showed that the liquidity was pulled from Trader Joe to a private liquidity pool controlled by Snowbank.
And it looked as if the buy back happened but the chart told a different story. When the private liquidity pool was finally available for token holders to sell their tokens, it was discovered that the slippage tolerance was locked at 99%.
This means that any attempt to sell would carry the risk of losing 99% of the value. Shortly after that, the price of the token 95% and almost everyone who didn’t sell lost all of its value.
Only a few select wallets sold ahead of time leaving some people suspicious of inside knowledge that this was going to happen. And these are the kinds of things that will continue to happen in the space, especially as DAOs get more popular.
There is real legitimate risk here. That being said, we’ll check back to see how this experiment pans out. It’s been two weeks, the results are in and boy, are they juicy.
First up, we have my 20,000% APY USDC investment This was routed to a DAO. Here I invested $200. After two weeks, I’m sitting on $218.10. This is a return of 8.6% in just 14 days, so I can’t say I’m upset about that.
However, I will say at one point I was down about about 20% just a week ago, so there was a lot of volatility here. In that same time, this token that this was based on decreased in price by 18%.
So the staking rewards actually made up for that decrease in price. Next up, we have one of the most popular DAOs: Wonderland. In the time that I was staking their token, it actually increased in price by 6.3%, which helped me in combination with their five digit staking rewards.
My total investment here was $250, and I’m now sitting on $342, a mind boggling return of 36.8% in just 14 days. And this is where the fun stops because my next investment didn’t pan out so great. The multibillion percent APY figures helped me to increase my total token supply. However, the total token value dropped 74.4%.
This meant my initial investment of $258 dropped down to just $143, a loss of more than 44%. But it gets worse, because we have the ultimate meme DAO, you know, our pal that was showing an unpronounceable 21 digit APY. Here I invested $246 and it’s now at $58.
This one was wild the entire time. It actually was my best performer at one point in time, surpassing a gain of 40% before absolutely tanking more than 90% at one point and I’m currently sitting with a 76% loss.
In the time since I bought the token, it’s decreased in price by 94%. So the astronomical staking rewards couldn’t really help me much, decreasing 94%. So all in across these four degenerate investments, I put in $956 and I’m currently sitting at $761, a total net loss of 20%. And there you have it, Degen investing so you don’t have to.
I don’t want this to be taken as a video saying DAOs are scams by any means, but I do think that gives a valuable lesson to not let greed dictate our investing decisions.
The best investments in this space or any space are going to be solid projects with long term potential, not just astronomical APY figures. If you would like me to keep my money invested in these and report back in a few months, comment down below.
I’m being honest, finding passive income in crypto is like finding a good used car dealer. There are so many scams and rug pulls with just a couple of diamonds in the rough. There’s just far safer ways to earn money in this space than the crazy APY.
And I think it pays to think long term. Now one way that you can plan ahead when it comes to crypto is by using a crypto retirement account. I partner with iTrustCapital who allows you to buy and hold cryptos within your Roth. This means that you can trade at zero capital gains in a tax advantaged account.
If you’re interested, I’ll have a link in the description that gives you $100 in Bitcoin just for signing up.
From here, I’d recommend you check out my other video that dive even deeper into the wild world of DAOs that you absolutely should check out. Now I would like to thank you so much for watching and I hope you have a profitable day! .