Curriculum

Web3 DeFi Tools

Web3 Yield Profits

0/10

Liquidity Pools (LPs)

0/7

Metrix.Finance

0/7

DeFi Tools

0/15

DeFi Trading Tools

0/6

Liquidity Mining

0/5

Uniswap LPs

0/5

SUI DeFi Blockchain

0/3

BNB DeFi Blockchain

0/1

SuperForm.xyz DeFi Yield

0/2

CFIRE

Find the Best Liquidity Pools

DeFi: Find the Best Liquidity Pools

Navigating the world of decentralized finance (DeFi) can feel like wandering through a vast jungle without a map, especially when it comes to finding the ideal liquidity pools. Yet, understanding how to identify these pools is critical for anyone looking to earn passive income. In this lesson, you’ll discover practical strategies using tools like Metrix.Finance to guide your journey through the DeFi landscape. Harnessing the right principles not only empowers your decisions in DeFi but also gives you insights applicable across the entire financial ecosystem, both traditional and crypto-focused.

Core Concepts

Liquidity Pools
- Definition: A liquidity pool is a collection of funds locked in a smart contract that facilitates trading and lending. Essentially, it allows users to trade or borrow assets without an intermediary.
- Crypto Connection: In DeFi, liquidity pools play a pivotal role by enabling Automated Market Makers (AMMs) to provide liquidity to users. These pools generally offer users the chance to earn returns on idle assets.
- Significance: Understanding liquidity pools is vital for optimizing your investments in both DeFi and traditional finance realms, where liquidity directly impacts asset valuation.
Total Value Locked (TVL)
- Definition: TVL refers to the total amount of assets staked within a liquidity pool. It serves as a measure of the pool’s size and health.
- Crypto Connection: A higher TVL often indicates more trust in the liquidity pool, but it can also mean lower potential yields due to competition.
- Significance: Knowing how to evaluate TVL helps you make informed decisions where liquidity and profitability intersect.
Annual Percentage Rate (APR)
- Definition: APR symbolizes the yearly return on your investment expressed as a percentage.
- Crypto Connection: Yield farming in the DeFi space can yield significantly higher APRs than traditional banking interest rates, yet entails more risk.
- Significance: Understanding APR allows you to compare investment opportunities effectively, whether in crypto or traditional accounts.
Trading Volume
- Definition: Trading volume measures how much of a particular asset is traded over a set period. It is a good indicator of liquidity within a trading market.
- Crypto Connection: Dynamic trading volumes can capitalize on price fluctuations. DeFi liquidity pools with higher volumes can provide better returns due to active participation.
- Significance: Low trading volume can signal potential risks in both markets, making volume a critical factor in your investment strategy.
Fee-to-TVL Ratio
- Definition: This ratio benchmarks pool fees against its total value locked, helping gauge profitability.
- Crypto Connection: A higher fee-to-TVL ratio indicates greater potential returns relative to the capital at stake.
- Significance: By understanding this ratio, you can prioritize liquidity pools that offer better returns relative to their size.

Find the Best Liquidity Pools

1. Utilize Comprehensive Tools

Aggregating Data: Use platforms like Metrix.Finance to get a broad overview of all available liquidity pools.
Simulating Performance: Take advantage of simulation features to understand potential returns before making deposits.

The ability to simulate returns allows for data-driven decision-making that can enhance trading success. Metrix Finance helps position you significantly better in the vast DeFi world.

2. Segment Your Searches

Exchange Preferences: Explore pools across multiple exchanges rather than settling for just one. Consider focusing on various platforms like Orca or Radium.

Segmenting exchanges permits you to compare different data points, allowing you to find the best-performing pools suited to your preferences.

3. Analyze Total Value Locked

Filtering by TVL: Aim for pools with a TVL between $1 million and $50 million.
Avoid Over-Bit pools: High TVL pools may signify diminished returns as they’re saturated with funds.

This strategy of targeting pools with moderate capital allows you to discover potential gems offering higher returns without excessive saturation.

4. Filter for Performance Metrics

APR Ranges: Decide on minimum APRs you’re willing to consider—ideally between 40% and 500%.

By focusing on more lucrative APRs, you can maximize the benefits of your liquidity provisioning efforts.

5. Scrutinize Daily Fees and Trading Activity

Choose Active Pools: Sort for pools with higher daily fees to TVL ratios to ensure active trading and liquidity.
Assess Volatility: Consider pools with lower volatility (below 15%) to mitigate risks.

Active pools typically offer better returns, resembling how active management in traditional finance can yield higher profits.

6. Due Diligence on Assets

Research the Underlying Assets: If you find a livestock pool, understand what’s being traded. Level up your decision-making by checking details on platforms like CoinGecko.

Analyzing assets allows you to make knowledgeable investments rather than gambling on obscure tokens with little information.

Blockchain Passive Income

The principles of liquidity pools, TVL, and APR distinctly apply to DeFi but also find parallels in traditional financial markets—think mutual funds versus liquidity pools. In both cases, understanding the underlying performance metrics greatly impacts investment outcomes.

Cryptocurrencies like Aave and Uniswap showcase these DeFi methods in action, enabling users not just to participate, but to engage actively through metrics that traditional investment vehicles often lack.

Examples

In the DeFi space, visual aids—like charts that display APR trends or TVL comparisons—can significantly enhance your analysis. For adaptations, imagine incorporating trends showing projected volatility alongside performance metrics.

Imagine:

Investing in an Ethereum liquidity pool with a 100% APR, translating high returns, versus a traditional savings account providing a modest 2% APR.
Analyzing two liquidity pools—one with a TVL of $2 million and another with $20 million, focusing on the fees and active trading volume for insights into potential profitability.

Real-World Applications

Historically, exploring liquidity pools has revolutionized how individuals can earn a passive income, reminiscent of high-yield savings accounts but with more volatility. Just as in the traditional finance realm, where the balance between risk and reward is crucial, so too is it in the cryptocurrency landscape.

Cause and Effect Relationships

The relationship between TVL and APR in liquidity pools exemplifies a cause-and-effect dynamic where increased liquidity often dilutes potential rewards, necessitating smarter investing decisions.

This principle also permeates traditional finance, where investment saturation impacts overall returns—an essential consideration when navigating both worlds.

Challenges and Solutions

Some challenges include the volatility of returns, potential impermanent loss, and the difficulty of assessing new or lesser-known projects. Fortunately, blockchain technology mitigates some of these challenges through clear transactional records and dynamic profit tracking.

Additionally, common misconceptions such as assuming high yields always equate to high risks can deter newcomers. Understanding that not all pools are created equal is crucial for informed decision-making.

Key Takeaways

Liquidity pools are essential for earning passive income in DeFi.
TVL is a critical metric for assessing each pool’s potential.
APR informs investment choices—higher isn’t always better without considering risks.
Research and due diligence on assets can protect against poor investments.
Active trading volume impacts profitability and pool viability.
Understand fee structures; higher ratios can suggest better returns.
Recognize the parallels between traditional finance and DeFi, strengthening your overall investment acumen.

Arming yourself with these insights will allow you to embark on your DeFi journey more confidently.

Discussion Questions and Scenarios

How would you approach liquidity pool selection differently if TVL was your only factor?
Compare the risk-return profiles of liquidity pools versus traditional investment vehicles.
How does volatility influence your investment decisions in both types of markets?
What strategies would you use to research a new token found in a liquidity pool?
Determine the advantages and disadvantages of choosing liquidity pools with higher TVLs.
In what ways can community engagement in DeFi platforms impact overall liquidity?

Glossary

Liquidity Pools: Fund collections allowing for trading or lending through smart contracts.
Total Value Locked (TVL): Measure of total assets staked in a liquidity pool, indicating market trust.
Annual Percentage Rate (APR): Yearly return on investment expressed as a percentage.
Trading Volume: Measure of an asset’s transaction activity over a period, key for liquidity assessment.
Fee-to-TVL Ratio: Ratio of pool fees to its TVL, indicating profitability potential.

Arming yourself with this comprehensive knowledge sets you up for success in the DeFi landscape.

Continue to Next Lesson

You’re equipped with the essentials for navigating DeFi liquidity pools—ready to find those gems that can yield passive income! Be sure to dive into the next lesson in the Crypto Is FIRE (CFIRE) training program, as your financial journey continues!

Read Video Transcript

How to Find the BEST DeFi Liquidity Pools (Crypto Passive Income)

https://www.youtube.com/watch?v=Qel38BU5Jpc

Transcript:

I’m going to be showing you how you can find the best DeFi liquidity pools using the all-in-one Metrix Finance liquidity provision software. So we’re going to dive right into this video, and since we are looking for liquidity pools, we are going to be using the Discover page. The Discover page on Metrix Finance is where it’s going to aggregate all the data.

It’s going to show a bunch of liquidity pools, practically thousands if we select all exchanges and all networks, and then from there we can decide to simulate performance. So we get a good idea on what our APR is actually going to be before we deploy and we make a data-driven decision. We could also build out the portfolio and track performance using Metrics Finance, but we won’t cover that in today’s video.

Anyways, most people when using Metrics Finance like to select just all exchanges and all networks, but my personal preference is segmenting these exchanges. And the reason why is because over on orca if we were to look at the fee to tbl ratio on these the highest ones are going to be 21 6.2 percent 5.

4 percent five percent whereas if we were to do the same exact thing over here on say these four exchanges you could see the highest fee to tbl ratio is 1.33 the data is a lot different so i like to segment between these four, and I like to go and segment between Orca and Radium, and then I like to segment between Velodrome and Aerodrome, just because there’s different data on each of these exchanges.

Now, when it comes to the actual networks, there’s not really much segmenting to do. If you want to select all, that’s completely fine. That’s if you don’t care about what networks you’re on. Personally, I find the best results on these networks right here. Ethereum, Arbitrum, Optimism, Polygon, Base, and BNB.

And that’s just simply because that’s where the majority of the TVL is for these four platforms up here. And these ones have minor amounts of TVL, maybe a couple million dollars, or maybe 10 to $20 million or so. I always like to put my TVL higher than $1 million.

And I like to do it lower than $50 million million dollars now some of you may ask why i’m doing it lower than 50 million dollars the reason why is because i don’t want to find a bunch of liquidity pools that already have a bunch of money in them that’s just going to waste space and really it’s only going to factor out like 10 pools or so but ultimately i want to find the pools that are kind of a little bit untapped and when i say untapped there’s still going to be pools out there with 43 million or something along those lines and those are still solid pools but ultimately the higher the tvl is a lot of the times the lower the apr is going to be in those

pools which is why i put a max of 50 million dollars and by the way guys today we are going to be using some of the metrics pro features which is a subscription for metrics finance again metrics finance is a free tool and then there are convenience features and advanced analytics if you do sign up for the pro subscription with that being said if you head to the link down below in description there is going to be an extended trial so instead of getting a five day free trial you are going to be getting a 14 day free trial so

there’s no risk whatsoever you can try this out try to make some money using metrics finance by finding better pools simulating accurate performance making data-driven decisions on your positions and then from there decide if you want to actually pursue with the $40 per month subscription.

And while we’re on the topic of subscriptions, if you guys are enjoying today’s video so far, make sure to drop a like and subscribe when notifications turned on so you don’t miss out the free value that we bring to DeFi strategies on YouTube. Anyways, I have a list of 548 pools right here. That’s still a lot to look through. So I personally always like to look through the assets first, right? So if I’m looking to pair stuff with Ethereum, and let’s just say some of those assets I want to pair with Ethereum are Aether, Render, Link, GRT, Aave, Unitoken.

I can just list those out right over here on the pool section. I type in the asset, I put a comma, I type in another asset, I put a comma, type in another asset. And this is going to show me all pools that include one of these assets. And then by putting must include ETH right over here, that’s going to show me pools that include ETH with one of these assets, basically.

So you’ll notice that now we only have 14 different pools. And this is a very, very easy way to just instantly see the pools that you want to include in your portfolio for assets that you are already aware of, that maybe you’re already comfortable with the risk. We have some good returns over here like 155 on ethereum to render there’s a hundred percent on ethereum to aether and it is important to keep in mind that these yields can be higher and the reason why is because metrics finance assumes a broader range

at the start on discover and then from there you can narrow down your range you could go with the tighter range and you can squeeze out more juice and get a higher apr but let’s just say maybe we’re not familiar with assets that we want to include in pools.

Well, I would still recommend typing in one asset over here, like must include ETH, if that’s what you’re looking for. Or if you’re looking for stablecoin ones, put must include USD. That’s going to show you ones paired with stablecoins. And the reason why is because you want to have a general idea of what type of pool you want to be in before you actually deposit.

So I usually like to be in stuff paired with eth so i’m going to type in eth from there i still have 416 different options so i usually filter my fees apr between 40 and 500 i personally do not like taking on exposure to the ultra high risk meme coins the meme coins that have no tbl stuff like that right i also don’t want to look for pools that have a return that’s so low that’s not worth it for me to manage so i do 40 to 500 because usually above 500 is those meme coins under 40 a return that’s so low that it’s not worth it for me to manage. So I do 40 to 500% because usually above 500% is those meme coins. Under 40% is stuff that’s not going

to get that good of a return. Now, even then 40% is low, but remember, as I said earlier, we can tighten up on the range and we can squeeze out more juice, which is why we assume 40. Because if we do go with the tighter range, we might end up getting 65, 80, hey, even 90, 100% depending on the pool.

And then we have 220 pools right here. I also like to go over the daily fees to TVL ratio, sort it so it’s in sequential order. And then I like to go to the middle ground in the actual pages. So you’ll notice that there are 22 pages here. I will go to page 11 and I will find the middle amount. And the middle amount right over here is going to be roughly 0.04%.

And I will do at least or higher than 0.04%. And the reason why I do that is because it cuts out the bottom half that’s not as good, that doesn’t have as high trading activity compared to the top half, basically. This is essentially displaying, hey, this pool right here has a $1 million TVL, but on average, on a daily basis, it has about $3,500 of daily fees. When we divide those daily fees by the TVL, we get this number right here so this is showing us pools that have a high amount of fees compared to the overall tvl and just like that we’re at 105 pools and if we really really really want to zone in and find even better pools we can sort by pools that

have volatility lower than 15 now that’s not going to cut out a lot but that cuts out seven we can even go down to like 13 or 10 or so uh and go down from there basically now in my opinion that’s not going to cut out a lot, but that cuts out seven. We can even go down to like 13% or 10% or so and go down from there basically.

Now, in my opinion, there’s not much of a difference between 80 pools and 105 pools. So I would just go about looking through these 105 pools. Now, as you’re looking through these pools, if you don’t know what these assets are, like Cosmic maybe, search them up on CoinGecko, pull up their website right from CoinGecko and learn more about their ecosystem and their project and one tip that i will give you is if you can’t find enough information about their ecosystem and project from their main landing page you probably should not invest into it they could have the best

product ever but if they do not know how to market their product which is the basics of having a good landing page and having a good website then you probably should not be investing into it like for example when you go over to metrics finance we tell you exactly what we do. We help you find the best pools.

We help you simulate the performance before investing. We help you build out portfolios with multiple positions and we help you track your position performance after you actually enter into your positions. You can see screenshots of what our app actually is and see how it exactly works. You can see all of our different features.

Each and every single site that you go to for cryptocurrency asset should be doing the same. It should be showing you all the information, telling you about it, telling you how they make money, right? Because you are investing into their ecosystem, you’re investing into their project.

So let’s just say that we were to do Aave token. Well, we would pull up Aave token right over here, and we’d head right over the website on Aave. And in this instance, it’s actually going to throw us over to the ave app but if we want to go to the ave website directly we just type in ave.

com it allows you to lend and borrow basically supply borrow swap and stake and more there’s 31 billion dollars of liquidity across ave you could see exactly how the model works you earn interest by supplying assets to pools and then you can borrow against your collateral which is the supply section for multiple networks and assets.

You can see the numbers, 31 billion in net deposits, 170 billion in volume, 7.11% average stablecoin supply APY on the Ethereum network last year. You can see all the data. So this is exactly how you should be analyzing websites. You’d be like, okay, what is this? And then from there, see how the actual token, in this case, Aave token, falls into the ecosystem.

So that right there is how you find the best pools. If you guys want us to make a video on how you can simulate potential performance and how we could say, okay, right here, we’re seeing 71%. Let’s dive into it. Let’s analyze this and see what type of return we can get after choosing a range, analyzing the volume, analyzing the liquidity distribution.

Features	PA	YG
Minimum Amount	$50	$50
Daily Yield	0.33%-0.4% daily	0.4%-1.5%+ daily
Monthly Yield	10%+ monthly	35%+ monthly
Funds Locked	250 Days (8mths)	Withdraw Anytime
Time Until 2X	8 months	2 months
Strategy After 2X	Withdraw original	Withdraw original
Risk Level	Medium	High
Launched	May 2024	May 2025
Easy of Use	✅ 5 mins daily	✅ 5 mins daily
KYC Required	✖️	✖️
Trading Bot	✖️	✅
LP Yield Farming	✅	✖️
Centralized	✅	✅
Decentralized	✖️	✖️
Team Known	✅	✖️
Team Country	USA	Russia
Blockchain Wallet	BNB BSC web3	TON Telegram
CFIRE Lessons	Yes	Yes

Features	Starter	Spark	Flame	Lightning	Ignition	Meteor	Supernova	Prometheus
Yearly	Free	$7	$99	$333	$1555	$3555	$7777	$25000
Coins Tracking	2	5	10	30	100	200	500	Unlimited
AI Queries Monthly	11	30	100	200	500	1000	2500	3500
AI Tutor	✅	✅	✅	✅	✅	✅	✅	✅
Crypto News	✅	✅	✅	✅	✅	✅	✅	✅
Passive Income	✖️	✖️	✖️	✖️	✅	✅	✅	✅
DeFi Alpha Intel	✖️	✖️	✖️	✖️	✅	✅	✅	✅
Market Updates	✖️	✖️	✖️	✖️	✅	✅	✅	✅
VIP Trainings	✖️	✖️	✖️	✖️	✖️	✅	✅	✅
AI Markets Data	✖️	✖️	✖️	✖️	✖️	✅	✅	✅
AI Crypto Research	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
AI Crypto White Papers	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
AI Query Books	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
AI Voice Bot	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
Custom Lessons	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
Private Strategies	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
-	Free Starter	$7 Spark	$99 Flame	$333 Lightning	$1555 Ignition	$3555 Meteor	$7777 Supernova	$25000 Promtheus
COURSES	3	5	7	9	11	15	20	20+
Lessons	100+	200+	300+	400+	500+	600+	700+	700+
What is Crypto	✅	✅	✅	✅	✅	✅	✅	✅
All About Bitcoin	✅	✅	✅	✅	✅	✅	✅	✅
Crypto Wallets	✅	✅	✅	✅	✅	✅	✅	✅
All About Money	✖️	✅	✅	✅	✅	✅	✅	✅
Coins & Tokens	✖️	✅	✅	✅	✅	✅	✅	✅
Security & Privacy	✖️	✖️	✅	✅	✅	✅	✅	✅
Crypto Exchanges	✖️	✖️	✅	✅	✅	✅	✅	✅
TA Trading Charts	✖️	✖️	✖️	✅	✅	✅	✅	✅
Making Money	✖️	✖️	✖️	✅	✅	✅	✅	✅
Web3 DeFi Tools	✖️	✖️	✖️	✖️	✅	✅	✅	✅
Passive Income	✖️	✖️	✖️	✖️	✅	✅	✅	✅
Secured Profits	✖️	✖️	✖️	✖️	✖️	✅	✅	✅
AI Bot Trading	✖️	✖️	✖️	✖️	✖️	✅	✅	✅
Leverage Trading	✖️	✖️	✖️	✖️	✖️	✅	✅	✅
Crypto Taxation	✖️	✖️	✖️	✖️	✖️	✅	✅	✅
International Banking	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
Travel & Passports	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
Sovereignty PT	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
Corp Structures	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅
Generational Wealth	✖️	✖️	✖️	✖️	✖️	✖️	✅	✅

Curriculum

Web3 DeFi Tools

Web3 Yield Profits

Liquidity Pools (LPs)

Metrix.Finance

DeFi Tools

DeFi Trading Tools

Liquidity Mining

Uniswap LPs

SUI DeFi Blockchain

BNB DeFi Blockchain

SuperForm.xyz DeFi Yield

Find the Best Liquidity Pools

DeFi: Find the Best Liquidity Pools

Core Concepts

Find the Best Liquidity Pools

1. Utilize Comprehensive Tools

2. Segment Your Searches

3. Analyze Total Value Locked

4. Filter for Performance Metrics

5. Scrutinize Daily Fees and Trading Activity

6. Due Diligence on Assets

Blockchain Passive Income

Examples

Real-World Applications

Cause and Effect Relationships

Challenges and Solutions

Key Takeaways

Discussion Questions and Scenarios

Glossary

Continue to Next Lesson

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$25,000

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CFIRE Membership Levels

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Curriculum

Web3 DeFi Tools

Web3 Yield Profits

Liquidity Pools (LPs)

Metrix.Finance

DeFi Tools

DeFi Trading Tools

Liquidity Mining

Uniswap LPs

SUI DeFi Blockchain

BNB DeFi Blockchain

SuperForm.xyz DeFi Yield

Find the Best Liquidity Pools

DeFi: Find the Best Liquidity Pools

Core Concepts

Find the Best Liquidity Pools

1. Utilize Comprehensive Tools

2. Segment Your Searches

3. Analyze Total Value Locked

4. Filter for Performance Metrics

5. Scrutinize Daily Fees and Trading Activity

6. Due Diligence on Assets

Blockchain Passive Income

Examples

Real-World Applications

Cause and Effect Relationships

Challenges and Solutions

Key Takeaways

Discussion Questions and Scenarios

Glossary

Continue to Next Lesson

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