{"id":466050,"date":"2021-05-11T04:11:24","date_gmt":"2021-05-11T08:11:24","guid":{"rendered":"https:\/\/financhill.com\/blog\/?p=466050"},"modified":"2021-05-05T20:45:39","modified_gmt":"2021-05-06T00:45:39","slug":"where-can-i-buy-defi-pulse-index","status":"publish","type":"post","link":"https:\/\/financhill.com\/blog\/investing\/where-can-i-buy-defi-pulse-index","title":{"rendered":"Where Can I Buy DeFi Pulse Index?"},"content":{"rendered":"

While it might look exceptionally complex on the surface, the traditional banking system operates on one elementary principle: It accepts money from depositors, and then lends those funds to borrowers. Banks operate as intermediaries between depositors and borrowers, facilitating the process of matching funds with creditworthy consumers. <\/strong><\/span><\/p>\n

Banks pay depositors interest, and they charge borrowers a higher rate for the loaned amount. The difference between interest received from borrowers and interest paid to depositors is the bank\u2019s revenue. Granted, commercial banks have gotten into a long list of additional services that generate other revenue streams, but the foundation of modern banking remains the same as it has always been. <\/strong><\/span><\/p>\n

Decentralized Finance or DeFi is intended to take the middleman out of the equation<\/strong>. Instead of putting money into banks and borrowing from banks, consumers come together anonymously via blockchain transactions. Smart contracts based in Ethereum\u2019s blockchain have been getting the most attention, and DeFi transactions benefit users because they generate passive income (for lenders) and cost less per transaction (for borrowers)<\/strong>. <\/span><\/p>\n

The DeFi industry as a whole is growing at an astonishing rate<\/a> – from $700 million at the end of 2019 to $13 billion at the end of 2020<\/strong>. To date in 2021, experts estimate the DeFi market to be worth $40 billion or more. That means tremendous opportunity for investors who are willing to take a chance on this growing technology. <\/span><\/p>\n

Of course, those who aren\u2019t familiar with blockchain-related products and services are a bit out of their element in terms of what and how to buy. The two biggest questions are these: What is a DeFi Index, and where can I buy DeFi Pulse Index? <\/span><\/p>\n

What Is A DeFi Index?<\/strong><\/h2>\n

Until relatively recently, those who wanted to invest in the potential of DeFi had to buy individual DeFi tokens. Examples include Uniswap (UNI), ChainLink Token (LINK), and Wrapped BTC (WBTC).<\/strong> However, that isn\u2019t particularly convenient, and it can be tricky for those unfamiliar with the DeFi market. <\/span><\/p>\n

In response to the proven demand for DeFi investment options, several DeFi indexes were launched. The concept behind these indexes is the same as more traditional indexes. Instead of putting investors in the difficult position of choosing one among many possible investments, the index collects a basket of assets to give investors instant diversification with every share. <\/strong><\/span><\/p>\n

Buying shares of DeFi index funds gives investors exposure to the potential of the DeFi market without a need to have a deep understanding of the advantages and disadvantages of each token. <\/span><\/p>\n

What Is The DeFi Pulse Index?<\/strong><\/h2>\n

The DeFi Pulse Index<\/a> was the first index in the DeFi market that isn\u2019t considered derivative or synthetic.<\/strong> Investors own the tokens that make up the index\u2019s assets. The DeFi Pulse Index started with ten of the most popular Ethereum-based DeFi tokens, and it is weighted based on the capitalization of each of the tokens. <\/span><\/p>\n

When evaluating tokens for possible inclusion in the index, the DeFi Pulse Index looks at the following criteria: <\/span><\/p>\n