📱 Best Platforms
Aave, Compound, Badger DAO
📖 The Hustle
Bitcoin itself does not earn yield, but wrapped Bitcoin (WBTC) — an ERC-20 token backed 1:1 by Bitcoin — can be deposited into DeFi lending protocols like Aave to earn 1-4% APY. That seems low, but on Bitcoin's massive market cap, even 3% is meaningful. Deposit WBTC into Aave as collateral, borrow stablecoins against it, then deposit those stablecoins into higher-yield pools earning 8-12%. This creates yield on your Bitcoin while maintaining your BTC price exposure. Use conservative loan-to-value ratios (30% or less) to avoid liquidation.
🚀 First Step
Buy $500 of WBTC on Coinbase, transfer to MetaMask, deposit into Aave's WBTC lending pool, and monitor the accruing interest over one week.
🔑 Keys to Success
- Keep your loan-to-value ratio under 30% — Bitcoin can swing 10% in a day, and liquidations happen fast at higher LTVs
- Borrow stablecoins against your WBTC and deposit those into yield pools — the spread between the borrowing rate and lending rate is your profit
- Monitor your position health weekly using DeFi Saver or set up automated protection to avoid getting liquidated during sudden market drops
🛠 Tools & Resources: Aave, Compound, MetaMask, DeFi Saver, Ledger