Decentralized Finance (DeFi) is poised for long term growth and value accrual, having already proving it’s worth as a better substitute to the traditional finance (though major work remains of course). According to the DeFi aggregator and analytics website DeFi Pulse, as of 15 Dec, relevant protocols currently have a cumulative value of $14.8B locked in and it’s showing no signs of slowing down any time soon! It’s no secret that investments into DeFi protocols have been massively profitable for people, but it’s certainly no easy task.
For one, there are a lot of DeFi protocols and new ones are forked over from existing protocols every day. It means that there’s a lot of choice, but of course not all DeFi protocols are created equal. Now, profitable investments into these protocols requires careful vetting and analyzing the risk/reward ratio, which is by means an easy task. But what if there was a way to allocate capital to a plethora of blue chips in a 1-Click DeFi investments method? Enter index funds.
DeFi Pulse Index – Token Sets
DeFi Pulse Index powered by Token Sets is a well known index fund, which allows for 1-Click DeFi investments. It holds multiple carefully selected blue chip DeFi protocol tokens in different weight-age or percentage of holdings – determined by the value of each token’s circulating supply like AAVE, YFI, UNI, SNX, COMP, MKR, REN, LRC, KNC and BAL. The most significant feature of the DeFi Pulse Index is it’s inclusion criteria, which is extensive and elaborate.
It considers tokens based on their nature, supply and it’s future predictability, team’s response to any incidents, liquidity, reputation, usage, time active etc. so users can be certain that they are getting the best of the best. The DeFi Pulse Index is constantly monitored and updated, according to changes in the market. To invest in it, visit it’s official page.
Power Index – Smart DeFi Index
The second, more recent and diverse is the Power Index – a collection of index funds. It has two variants – Power Index (PIPT) and Yearn Ecosystem Token Index (YETI). Now, the former is the classical collection of highly established DeFi protocols while the latter is for recently launched projects with great potential. Power Index is for more conservative investors with medium risk appetite while Yearn Ecosystem Token Index is for more adventurous investors with a high risk appetite.
Power Index contains assets like AAVE, YFI, SNX, CVP, COMP, wNXM, MKR and UNI (all on 12.5% weight-age or percentage of the total fund). Yearn Ecosystem Token Index contains assets from Yearn ecosystem – led by the DeFi flagship grade project Yearn Finance. These include YFI and SUSHI (35%/17% weight-age respectively) at the top. The rest of the asset are CREAM, AKRO, COVER, KP3R, CVP and PICKLE (all at 8% weight-age)
You can find Power Index here and Yearn Ecosystem Token Index here. They offer 1-Click DeFi investments through a simple yet powerful interface showing the token percentages, wallet overview (assets contained in the fund), option to buy directly though ETH and by supplying single or multi assets to the pool. Both indexes also offer the facility for staking in multiple pools for passive income and the redeem option to convert the index fund tokens back to Ether (ETH).