In the Midas Investment review, we cover investment strategies, security, legitimacy, rewards and interest rates.
Midas Investment is a great place to the best earn crypto interest yields and APY. As you can see in the interest rate table, Midas Investment offers the best earning rates for many cryptocurrencies.
In addition, Midas Investment allow US customers to deposit and earn interest.
No Financial Advice, Information only. Do your own research
What is Midas Investment?
Midas Investment is a custodial investment platform for cryptocurrencies. They have managed to accumulate over 18,000 investors and raise more than $22 million in assets.
Midas Investment is generating yield and passive income by using different strategies and applying them in the Defi market.
There are always inefficiencies arising in fast-developing markets, like the crypto market. Such market inefficiencies allow the Midas DeFi team to use algorithms to benefit from opportunities in the market. There are even yield generation opportunities of Defi without the need for trading or speculations.
Midas operates to localize such advantages and by doing this also negates the risks of human error. The yields are generated by assets that are used by protocols. Each protocol uses your capital to bring peer-2-peer value to investors and in return, you receive fees and tokens.
Midas Investment Investment Rates
Midas Investment interest rates are among the best on the market. Also, Midas Investment allows US citizens to sign up, deposit, and earn interest.
Is Midas Investment Legit and Safe?
Midas Investment states that 90% of users funds are in cold wallets, and their database is encrypted with AES-256 security.
However, after a conversation with them, Midas Investment has almost all its funds in investment strategies.
Midas Investment is using Fireblocks, a third-party company to manage the treasury operations. By doing this Midas can access Defi, and manage digital asset operations without compromising private keys.
Fireblocks can almost be considered cold storage with an interface.
Midas Investment has established an investment process with high-security measures and is investing in Defi protocols, not from hot wallets.
Midas Investment Products
Midas Investment offers four different products categories summarized below
Midas Investment’s core asset product will earn the highest yields on a single cryptocurrency asset through hedged investment strategies. Examples are BTC, ETH, BNB, and stablecoins
Yield Automated Portfolios (YAPs) are long-term portfolio management strategies. The available assets are Stable YAP and Defi YAP and both yield daily rewards.
YAPs are a basket of selected assets tailored for a different strategy and strive to outperform the market through monthly rebalancing and asset diversification.
In the screenshots below, you find the cryptocurrency allocation for Defi YAP and Stable YAP. There is also information about the APY, risk and reward.
MIDAS token was created to produce additional yield above and beyond that of traditional crypto assets.
MIDAS token is powered by the Fantom blockchain network and is capped at a 5M total supply.
Midas Investment Strategies
Midas Investment uses different models of volatility prediction, correlation, strategies, collateral asset models, and hedging.
Midas DeFi Team builds a portfolio for each cryptocurrency based on the market conditions. The Defi strategies complement one another by robust risk management policies to generate sustainable yields.
Here are the main investment strategies
Concentrated liquidity provider for Uniswap V3
Midas Investment provides concentrated liquidity to Uniswap V3. At Uniswap you “deposit” two assets in a chosen price range. You will earn more fees if you go for a tighter price range.
If the price of any supplied cryptocurrency or token goes beyond your custom range, the liquidity is swapped to the asset.
Annualized percentage rate (APR) by Midas strategy. 20% – 60% APR
The main risk with Uniswap V3 liquidity providing is
impermanent loss. The risk is if there is extensive growth of one asset which will lead to decreased amount of target assets. Midas rank this risk as a medium and they hedge the risk by self-collateralization through lending the target assets and liquidity. It decreases return by 30% but negates the main risk.
Borrowing for target asset’s collateral to free liquidity
Use cryptocurrency as collateral to access more funds. Midas Investment uses this strategy in a combination with another strategy and it performs extremely well in terms of USD increase. The asset itself doesn’t generate yield but Midas gets access to more funds by using it as collateral.
The main risk is if the price of the collateralized asset depreciates rapidly.
Midas ranks this risk as medium and hedges it by taking a strategic position on a target asset, a liquidation value higher than 40%.
Midas Investment’s product Yield vaults use decentralized hedge funds, such as YFI. Yearn finance (YFI) is a yield optimizer that moves funds around decentralized finance.
Annualized percentage rate (APR). Up to 15% APR
YFI has a great track record for hacks being fixed in less than an hour and a 100% money-back guarantee due to insurance protocols and insurance funds. Therefore Midas Investment ranks the risk as low and the main risk is the high fees for interacting with the protocol, which can strongly reduce APR. Midas Investment hedges these risks
by interacting with contracts during the nighttime hours, when the gas price is low.
Asset + Stable liquidity provider to hedge from market pullbacks
Combining the core cryptocurrency assets with USDT or any other stablecoin allows for earning more of the core asset during market pullbacks due to impermanent loss.
By doing this, it’s possible to increase the core asset amount.
In addition, core asset + stablecoin liquidity pools are hardly incentivized by protocols since it is one of the most used trading pairs. An example is BTD/USDT.
Annualized percentage rate (APR). 30% – 150% APR
Midas Investment set this risk to medium because there is a risk of continual rallying in the market. They hedge the risk by making incremental increases in size position, and with a combination of strategies, it typically favors market growth.
Leveraged liquidity farming
Leveraged liquidity farming allows farmers to leverage up their yield farming position, meaning to borrow external liquidity and add to their liquidity to yield farm.
Midas Investment take advantage of this by combining core assets with USDT or any other stablecoin to earn more assets during market pullbacks due to impermanent loss, which increases the core asset amount.
In addition, asset+stable liquidity pools are hardly incentivized by protocols, since it is one of the most used trading pairs.
Annualized percentage rate (APR). Up to 75% annual returns.
Midas Investment evaluates the investment risk as high because flat markets with high volatility may give many false signals. They hedge the risk by using DeFi strategies to limit the risks as an impermanent loss.
Midas Investment Pros and Cons
Midas Investment Pros and Cons
Midas Investment Pros
- Very high-interest rates and yields
- A large variety of assets are available
- Accept US customers
Midas Investment Cons
- No fiat deposit options
- New and still quite a small platform compared to competitors like NEXO, Celsius, BlockFi