DeFi (Decentralized Finance)
The profit logic of DeFi is mainly based on 'decentralized financial products', allowing people to borrow, trade, and invest without traditional banks and other intermediaries. Most profits come from two main sources:
Liquidity mining: Users provide their assets to decentralized exchanges (DEX) or liquidity pools, helping to enhance trading depth and liquidity, thereby earning rewards distributed by the platform, which are typically governance tokens or other assets. For example, on platforms like Uniswap and Sushiswap, users providing liquidity can earn a portion of the trading fees as rewards.
Lending interest spread: Decentralized lending platforms (such as Compound, Aave, etc.) allow users to lend or borrow assets. Lenders earn interest, while borrowers must pay higher interest than traditional financial markets, and the platform earns fees by acting as an intermediary.
Profit Summary: Users can earn profits in the DeFi market mainly from platform fees, governance token rewards, etc., by acting as liquidity providers, lending investors, or borrowers themselves.
NFT (Non-Fungible Token)
NFTs are a hot trend in the fields of digital art, collectibles, and in-game assets. The profit logic of NFTs can be understood from the following aspects:
Buy low, sell high: The profit model of NFTs is somewhat similar to other assets like stocks, involving buying at a low price and selling at a high price. For example, if you purchased a scarce digital artwork at the initial release and, as the work gains popularity or the artist becomes famous, the value of the NFT continuously increases, allowing you to sell it at a high price and profit from the difference.
Royalty income: NFT platforms usually set a royalty for each resale of NFTs, meaning that every secondary market transaction will benefit artists or original NFT creators as they receive a certain percentage of the fee.
NFTs as virtual assets: For games or digital asset applications, players can purchase rare game items or virtual land NFTs, which, over time or with increasing market demand, will continuously appreciate in market value, allowing for profit upon sale.
Profit Summary: The profit model of NFTs typically generates revenue through buying low and selling high, royalty mechanisms, and the appreciation of virtual asset prices.
GameFi (Gaming + Financialization)
GameFi combines blockchain technology and the gaming industry, allowing players to earn money by playing games. This sector has been widely discussed in recent years, with profit logic including:
Earning in-game assets: On GameFi platforms, players can earn tokens or NFTs by participating in the game process. These virtual assets can be traded, auctioned, or sold both on and off the platform. For example, on platforms like Axie Infinity, players earn platform tokens through activities like battling, breeding, and trading creatures, profiting through these transactions.
Earnings from playing and investment returns: Players can also earn returns by investing in NFT assets and virtual items in games, not only upgrading their virtual characters and gradually appreciating their assets but also directly selling these assets.
Governance tokens: Games often design their governance tokens, and players can accumulate and invest these tokens to gain additional rewards or rights within the game. These tokens can participate in platform governance voting, influencing future development directions and providing additional earnings for players.
