Crypto and fiat savers are making a fatal mistake – and DeFi can come to the rescue

In crypto and fiat, many consumers make a fatal mistake: they leave their assets idle in accounts without earning interest. Use case

There's no escaping it: DeFi markets have cooled over the past year.

After crossing the $180 billion mark in total value locked last November — coinciding with Bitcoin's run to a new all-time high of $68,700 — data from DeFiLlama shows that the collective value of this market has now down to around $40 billion.

Nevertheless, experts remain optimistic about the potential of decentralized finance. The protocols continue to develop furiously during the bear market, ensuring that they will be in a strong position for the next wave of adoption. And while this recent contraction has spooked some retail investors, there are still opportunities ahead.

Here's the thing: through crypto and fiat, many consumers are making a fatal mistake. Whether their savings are denominated in US dollars or stablecoins, they leave their capital idle in accounts that do not earn interest. And given the runaway levels of inflation currently seen in major economies, this effectively means that their wealth is shrinking and their purchasing power is eroding month by month.

DeFi may be the answer here, but finding the best opportunities in this nascent space and ensuring your assets are still allocated efficiently is a near impossible task to do manually. And even if you experience above-market levels of return, that can often change before you can take advantage of the opportunity.

Crypto is a volatile market that requires 24/7 monitoring to be an effective investor. Additionally, traders often end up with FOMO – a fear of missing out – after deploying their assets to a specific protocol.

A new concept emerging in DeFi is reactive liquidity. This means that crypto enthusiasts have the opportunity to ensure that their digital assets are earned...