Why DIVI DeFi?

Understand how the DIVI DeFi platform will allow you to trade in a decentralized manner, provide liquidity, earn fees, and more.

Divi Project

November 15, 2022 · 2 min read

DeFi Education Series #3

The Rewards of DeFi

The Divi DeFi educational series has already outlined the differences between CeFi, DeFi, and centralized and decentralized exchanges. Here we showcase how users participating in the Divi DeFi ecosystem will be granted a decentralized way to trade, get rewarded for providing liquidity, and can keep earning staking rewards all at the same time!

Why DeFi is beneficial to You


DIVI is listed on centralized exchanges such as Kucoin and Bitrue. If those exchanges have problems with insolvency or low liquidity, as we've seen recently with FTX, users could need an alternative way to exchange their DIVI. 


The DIVI DeFi platform will allow users to swap their layer-one DIVI for DIVI(ERC-20), which creates a new trading option on the Ethereum network where most decentralized exchanges operate. This ultimately gives users a way to trade without relying on centralized entities. 


DeFi is designed to reward users who provide liquidity for trading, lending, and yield farming. Traditionally in CeFi, only large financial entities could participate as market makers or lenders. By leveraging smart contracts, anyone can provide liquidity for swaps between tokens in a decentralized ecosystem and be rewarded for doing so. 


Example: 

  1. A user who wishes to provide liquidity for a specific trading pair deposits equal values of each token into a liquidity pool and receives liquidity pool tokens (LP tokens) in return. 
  2. When traders swap between the tokens in the pair, they pay a fee for the service. Rather than a centralized exchange collecting that trading fee, the users who provided liquidity to the trading pair receive the fee. These fees may be small, but they occur frequently and can add up over time to provide a source of passive income. 
  3. When the liquidity provider is ready to stop providing liquidity for the trading pair, they can redeem their LP tokens for the tokens they provided initially, plus the fees. *Keep in mind that this balance between tokens can change as we discuss more in our deep dive into liquidity and impermanent loss.


Lastly, the Divi DeFi platform will allow liquidity providers to continue earning the staking rewards they are used to when staking their layer-one DIVI coins. This creates an even further incentive to provide liquidity while not missing out on staking rewards


DeFi offers many different benefits for its users over traditional finance, and now anyone can access financial services typically reserved for the elite. Even a small proportion of current DIVI stakers providing liquidity for the new DIVI DeFi protocol will result in price stabilization, deeper liquidity, and arbitrage opportunities. The ensuing outcome will be a healthier overall trading market for DIVI. Don't put yourself at the mercy of bankers, potentially bad actors, and centralized exchanges. Take advantage of smart contracts within the DIVI DeFi platform. Don't trust; verify.


Next up

As the next step in this journey into Divi DeFi, we will explore dApps and share what you should know to maximize rewards and mitigate risks. 


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  • Beginners Series
  • Guides
  • Web 3.0
  • DeFi

Divi Project

November 15, 2022 · 2 min read

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  • Beginners Series
  • Guides
  • Web 3.0
  • DeFi

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