Lending Protocols are a huge innovation in the blockchain space. The majority of these protocols are built on top of Ethereum. Lending protocols are a blanket term for some type of decentralized debt marketplace. They are called protocols because they exist at a level where anyone can plug and play with this decentralized piece of software that lives on a blockchain.

For those of you without knowledge of the Ethereum blockchain this is what we mean. This is the Compound.Finance smart contract. It lives on Ethereum. This smart contract is what runs compound.finances business. Smart contracts all tokens and assets on Ethereum to move in programmatic ways.

You will understand the basis of lending protocols, how to use them and the technology that enables Outlet to work within this article.

The easiest way to get started earning interest on stable coins using a lending protocol  would be to use the Outlet mobile app. You don't need anything else to get started that way.

Lending Protocols are a genre of decentralized apps, business, or DAO (Decentralized Autonomous Organization). All of these phrases would be correct to say. They are a business built around the concept of building a decentralized debt marketplace.

A lending protocol will have one of the following:


: The people who back loans within the debt marketplace in some capacity.


: These are the people who take on the debt and enable suppliers to earn a return on their funds.


: A blockchain will show you where, how, and when loans and money is introduced to these protocols. Most protocols will have some type of a smart contract. These smart contracts will enable people to see what is going on with a particular lending protocol or their account(wallet)  itself.

There is not necessarily a right answer on how to use a lending protocol. There is however a much better and clear way than most people use. Outlet provides people with a one step and easy way to pull together everything you would need to actually use a lending protocol.


The most popular way to start earning interest on your stable coins would be as follows.

Obtain your dai or stable coin asset you would like to use to gain interest on, or take a loan out on. If you are a newcomer to crypto I would suggest you just download Outlet and get your dai that way or you find a way to obtain it via other means. This can be done through almost any exchange. Dai in particular is the preferred method to interact with these protocols.

Send dai to a web 3.0 wallet The industry norm is to use 

 at this point. Metamask is the most popular Ethereum wallet and is safe and secure. It does require you to store keys which can be a pain for some people, but an essential feature to others. It is important that if you are using metamask to interact with lending protocols to save your key and safely store it. The best way would be to write them down and keep them in a safe physical location.

Once you have your dai in a web 3 connected wallet you should be able to interact with these new decentralized applications. This is the most tricky step, as each lending protocol will have a different UI and will be slightly different to interact with and begin using. Most of them are very simple and you should be able to figure it out.

Authorize their application within your wallet. You will be asked by metamask if this application is warranted to have access to your wallet. This is what allows you to actually interact with a lending protocol. At this point the protocol can see how much is in your wallet that are eligible to be supplied or borrowed. Once you select your amount by selecting supply or borrow the lending protocol will carry out that function as you selected.

How to get the best returns on Lending Protocols?

Getting the best return when you are lending to a protocol is a very hard thing to do manually. If you wanted to do this right now you would have to do a lot of manual trading and watch your supplied assets religiously. It is not practical to manage the returns you earn using lending protocols.

The easiest way to maximize your return using lending protocols would be Outlet. Outlet has a planned feature of maximizing the returns for users and supplying dai to the highest yielding lending protocol.

Lending protocols are super safe loans to back because they are overcollateralized. Meaning that the borrower will put up more assets than they are borrowing. Although the loans themselves are safe from a financial standpoint. There are other outstanding risks involved in using a lending protocol.


Using a lending protocol carries another layer of risk. This risk is called smart contract risk. The risk is that it is possible to hack a smart contract and have a hostile takeover. There have been several smart contract hacks that have taken place to companies outside of the DeFi space and is a possibility to happen to these protocols as well.


There is a small risk called smart contract risk. If the developer of the smart contract creates a smart contract with security flaws there is a chance that contract itself can be hacked.


DeFi protocols have fortunes locked in them at this point and are trusted by thousands of people. The larger lending protocols have some of the best smart contract security on the market and thus far no one has come close to hacking one of these protocols.

Lending protocols are made up of a two sided product. One side of the product supplies the money to fulfil loans and the other side takes out these loans.There are a few reasons why people are taking out so many loans against their cryptocurrency. There are a few problems with using cryptocurrency in everyday life that don't make it as viable as your countries traditional fiat currency.


The following are some of the reasons why people take out loans against their cryptocurrency:


: This is when someone who holds assets is looking to essentially double dip and buy more crypto with the crypto they own as well.

To have a right to buy it back at a certain rate

: people will often take out a loan against their crypto holdings if they are looking to extract cash from their portfolio. The loans themselves provide users with a way to buy it back at a specific price and is a common route for people with large portfolios to do.

: Margin trading is a method of trading assets using funds provided by a third party the third party can be one of these lending protocols.

If you have any further questions a great place to go would be our Discord server. We will be happy to answer anything.

Everything You Need To Know About Lending Protocols - The Complete Guide

Banks are a great product. They offer customers a way to safely store their assets under the bank's management. Governments ensure that these banks are kept up to high standards and are there to police banks from misusing your funds.

Banks use their customer's money to generate income, which is usually not shared with customers. The dollars that you deposit into these banks are being put to work by the bank itself. Banks have very little transparency when it comes to how they manage and utilize their customer's funds. When the bank puts your money to work you don’t know where it's going or the kinds of returns the bank is actually making on your dollars. 

Whenever customers deposit money into Outlet you are able to see exactly what is going on with your dollars thanks to the Ethereum blockchain. You are able to see where your funds have been by using something like Etherscan. The etherscan information will be accessible through the Outlet app.

Depositing money in your Outlet account allows you to earn higher interest rates than you would on a traditional bank account. This is done through the use of blockchain technology, more specifically through the use of a stablecoin. A stablecoin is a cryptocurrency that is pegged 1:1 to 1 USD. Each stablecoin is equal to one dollar. These stablecoins are just as good as your cash.

Outlet then takes the stablecoins generated from your deposit, and lends them to cryptocurrency traders and exchanges via a secured loan. This secured loan ensures that your funds are safe, and available for withdrawal whenever you please.

The Difference Between Outlet And A Bank Account.

1. Outlet is not an actual bank. Outlet is a banking alternative, in the sense that we allow you to safely and securely store USD within an account.

2. The balance shown in your account is very accurate, but may vary from exactly what you see when you withdraw from Outlet back to your bank account.

3. By agreeing to these terms you understand that Outlet does not directly control your assets, and is not responsible for your assets. We simply guide you funds to different businesses that enable your funds to have a high rate of return.

4. You must upload valid IDs and your actual information during the signup and KYC process. This is very important for tax related purposes, if you misreport these documents we will be forced to close your account.

5. The balance shown in your account is very accurate, but may vary from exactly what you see when you withdraw from Outlet back to your bank account.

6. You understand that Outlet interest rates are variable. Our interest rate depends on the supply and demand of the different money markets (Lending protocols) that we use.

7. By accepting these terms of service you agree that Outlet can send you text, email, and other forms of communication such as push notifications.

8. Outlet uses dai. Dai is an experimental technology on the Ethereum blockchain. It is a decentralized stable coin pegged to the USD. I understand that my accounts balance will slightly vary on withdraw due to dai losing its peg from $1

If you would like further explanation on our product or what's going on at Outlet you can reach out to us here and we will gladly answer any questions you have.

Terms of Service

A DeFi or decentralized finance community exists at Outlet. The people interested in decentralized finance tend to be like minded. Topics and discussion within our decentralized finance and Ethereum community are as follows. This DeFi discord exists as a way for people to get news from other DeFi developers about exciting new Ethereum applications and things to do with your ethereum.

This discord community is a great place to openly speak about cryptocurrency products of any kind, but referral links will not be tolerated. Speaking to one another about exciting things within the decentralized finance niche is perfectly fine. This decentralized finance discord server supports the forward thinking approach of the community and the products they create.

This decentralized finance community is also for anyone interested in gaining some type of a return on their money. This decentralized finance community is made up of a large amount of people who want to be the bank. The common goal of decentralized finance is connecting funds and backing decentralized loans.

DeFi: The decentralized finance movement built on Ethereum.

Ethereum: decentralized platform for money and new kinds of applications.

Cryptocurrency: A transferable digital asset, often used as a store of value.

Smart contract: a pragmatic way to move money. Can uphold an agreement.

Blockchain: A decentralized public ledger.

Dapps: Decentralized apps built with some blockchain layered solution.

DeFi Community

Outlet is a cryptocurrency finance company that specializes in connecting USD to blockchain assets. Outlet's main product is its high interest rate money holding accounts. They work very similar to a bank account, in the sense that you store your dollars inside of it.

We are able to give you such a high rate of return on your deposited dollars because of how we manage your funds. When you deposit money in your outlet account there are a few things happening in the background that allow us to achieve this high rate of return. Mainly, we convert your assets to stable coins on the Ethereum blockchain and loan them out. Our process fulfills collateralized loans. Meaning people have an asset they are borrowing against that is worth more than the loan itself.

Depositing money in your Outlet account buys a stable coin. A stable coin is a cryptocurrency that is pegged 1:1 to 1 USD. So 100 stable coins = $100 USD. They are called "stable coins" because their value does not fluctuate and remains at $1 USD, unlike Bitcoin. These stable coins are on the Ethereum blockchain. These dollars are just as good as your cash.

In order to achieve 10% interest we need to utilize blockchain technology. The technology allows us to integrate our mobile application to open source protocols that are algorithmic, efficient money markets on the Ethereum blockchain.

Outlet is similar to a liquidity fund. We seek out the best return for those who save with us.

What is Outlet, and how does it work?

This privacy policy ("policy") will help you understand how Outlet.Finance ("us", "we", "our") uses and protects the data you provide to us when you visit and use Outlet,Finance ("website", "service").

We reserve the right to change this policy at any given time, of which you will be promptly updated. If you want to make sure that you are up to date with the latest changes, we advise you to frequently visit this page.

When you visit the website, we may collect the following data:

Your contact information and email address.

We are collecting your data for several reasons:

To send you promotional emails containing the information we think you will find interesting.

To contact you to fill out surveys and participate in other types of market research.

To customize our website according to your online behavior and personal preferences.

To provide you with a legitimate service and meet legal requirements.

Outlet is committed to securing your data and keeping it confidential. Outlet has done all in its power to prevent data theft, unauthorized access, and disclosure by implementing the latest technologies and software, which help us safeguard all the information we collect online.

Once you agree to allow our website to use cookies, you also agree to use the data it collects regarding your online behavior (analyze web traffic, web pages you spend the most time on, and websites you visit).

The data we collect by using cookies is used to customize our website to your needs. After we use the data for statistical analysis, the data is completely removed from our systems.

Please note that cookies don't allow us to gain control of your computer in any way. They are strictly used to monitor which pages you find useful and which you do not so that we can provide a better experience for you.

If you want to disable cookies, you can do it by accessing the settings of your internet browser.

Our website contains links that lead to other websites. If you click on these links Outlet is not held responsible for your data and privacy protection. Visiting those websites is not governed by this privacy policy agreement. Make sure to read the privacy policy documentation of the website you go to from our website.

Restricting the Collection of your Personal Data

At some point, you might wish to restrict the use and collection of your personal data. You can achieve this by doing the following:

When you are filling the forms on the website, make sure to check if there is a box which you can leave unchecked, if you don't want to disclose your personal information.

If you have already agreed to share your information with us, feel free to contact us via email and we will be more than happy to change this for you.

Outlet will not lease, sell or distribute your personal information to any third parties, unless we have your permission. We might do so if the law forces us. Your personal information will be used when we need to send you promotional materials if you agree to this privacy policy.

Privacy Policy

A practical blockchain product for non crypto people

Cryptocurrency and blockchain related products have yet to have an app with true product market fit for the average consumer. Building a product in the blockchain niche and finding a terrific fit has proven to be very difficult from an entrepreneur's perspective.

Finding Product market Fit in the Blockchain Niche

Product market fit in the blockchain industry has proven itself to be very difficult for some ventures. There are several reasons why I would argue that a blockchain technology company is one of the hardest companies to find product market fit.

Due to the short history of the blockchain industry there is not much to go off of in terms of end consumer products. The closest product to have product market fit was Cryptokitties. Cryptokitties was a fad, but had product market fit for the time of the fad.

Out of all the promising cryptocurrency apps few would have thought Cryptokitties would be one of the most promising. It’s that unknown that makes launching a crypto related company.

The biggest tip I have for anyone launching their cryptocurrency or blockchain related company would be to look at a large existing markets and find a way to improve on them. If the market is large enough and the innovation you bring to that field is innovative people will use your application. Marketing to any niche with a new and innovative product seem to work best by speaking to potential users in person. Try and go to a few meetups, and get people excited about what you are creating. Be where the conversation in your niche is happening, and don't be afraid to talk about the current problems they are facing if your app solves them.

Outlet - A better savings account powered by blockchain technology.

Outlet is a new project that started at the Y Combinator Hackathon. When we originally built Outlet it was a much different product. The product was a decentralized collateralized bitcoin loan platform. We saw certain projects popping up in the Ethereum and DeFi space that users loved and felt really inspired by them.

The issue with the original idea behind outlet became funding the loans. Without funding the loans our blockchain product would never be able to find product market fit.

Instead we saw the potential for allowing anyone to back existing loans, and connecting their funds with an existing pool of loans.

People invest in cryptocurrency to possibly make money. These people are searching for that. Financial products are a great solution to create that possibility. Making your customers money and providing them with a yield is a great way to find a fit within the blockchain niche because it is what brings everyone to the industry itself. Part of building a blockchain product is finding what angle you are going after your users with. There needs to be some type of competitive edge to your product compared to others. Creating a new category product seems to be the right way to go about things.

Building a blockchain company that has product market fit is hard because the field is constantly changing and we are still in the beginning stages of something huge. The companies that exist in this era of the blockchain world have a massive first movers advantage to market.

The most common question we get asked is about our insurance. We wanted to take this article and speak to our users about the insurance that protects them. 

 is the first decentralized finance product that natively integrates insurance into its platform. If you are looking for insurance on your DeFi account 

 has a special form of insurance that uniquely aligns with our product. 

 is protected against smart contract risk.

Our smart contract insurance covers the following.  The insurance will cover “unintended code usage” where someone, not necessarily the cover purchaser, has suffered a financial loss on the smart contract. As an example, the cover would pay out on the DAO hack, and the two Parity multi-sig wallet issues. It is not intended to pay-out on loss/misuse/phishing of private keys as this cannot be verified.

The Truth About Insurance In Open Finance

Insurance in the world of open finance is very new. The DeFi protocols that power open finance themselves are also extremely new. The technology that is powering the insurance is Nexus Mutual. Nexus Mutual is one of the first businesses of this type, and with time will become better and more sophisticated coverage.

Insuring your open finance portfolio can be done using several products. The right product for you will migitage whatever risk you think is riskiest. The best insurance is smart contract insurance in Outlets use case. If you are interested in learning the other risks involved in using decentralized finance tools you should read the whitepapers of projects such as MakerDao, Compound.Finance, and DY/DX.

The description given by Nexus Mutual is vague. In this section we are going to clear up what is actually covered under the smart contract coverage provided to Outlet users. In a decentralized finance protocol there is an entity known as a smart contract. A smart contract is a decentralized way to programmatically moving some type of value across a blockchain. A smart contract can be seen on the public ledger of the blockchain it lives on. In 

’s case we utilize smart contracts on the Ethereum blockchain. The coverage on our contract covers the misuse of one of these smart contracts.

Smart contracts have been hacked in the past. The open finance and DeFi protocols we have chosen to work with have all been audited by top auditing firms in the space. Such as 

. Smart contracts do have vulnerabilities and are the largest risk taken when interacting with a decentralized protocol.

Getting Insurance On Your DeFi or Open Finance Account

Getting insurance on your open finance or decentralized finance accounts/portfolios is simple when you use 

 account will come with insurance for free right out of the box if you sign up for the Beta. If you are using Outlet post beta you will have to pay for the insurance. The insurance will be the exact insurance explained above. Smart contract insurance. This will cover any amount of smart contract hack or loss in the smart contract itself.

A decentralized finance manager a new emerging product category in the cryptocurrency universe. It allows for users to see their positions between multiple protocols. Having insurance on your open finance manager is important to anyone who has an interest in maximizing their returns and hedging against the smart contract risk you take on as a user.

Outlet is not a traditional DeFi manager. We are an aggregator. We both manage and maximize your returns in the world of DeFi and Ethereum. Our higher tier accounts come with insurance for a paid subscription.

Outlets form of insurance is ran through Nexus Mutual and called smart contract insurance. Not only does outlet manage and maximize the DeFi experience it safely protects it by offering smart contract insurance placed on the smart contracts we are lending through.

Outlet Smart Contract Insurance 

Outlet is a high interest way to manage and save your USD, similar to a bank account. Our customers receive up to 10% interest on their USD. Outlet matches your funds with people that issue cryptocurrency backed loans. You can use Outlet just like a bank account, but we are not a normal bank. This blog post gives you more information behind what we are supporting, and where the funds you deposit go in order to achieve the amount of interest they generate.

What is DeFi, And How Does DeFi relate To Outlet.

Defi, or Decentralized Finance describes a financial system that is built on top of blockchain technology, such as Bitcoin or Ethereum. These decentralized financial products are typically transparent, and are not owned by a sole entity and are accessible to anyone. Ethereum has proven itself to be an incredible technology, and will likely become one of the most transformative movements in finance.

Your Funds Are Loaned To The Following Protocols

These protocols and companies issue loans. These loans secured loans backed by cryptocurrency. When we lend your money, the person borrowing has to secure the loan by depositing collateral. Currently, if a borrower wants to borrow $100 they would need to deposit $200 in collateral. This assures that your money is safe if the borrwer were to default on the loan.

Lending out your cryptocurrency to protocols and organizations that issue loans backed by cryptocurrency is the type of cryptocurrency lending we are speaking of when you see it on our site.

When you lend out your cryptocurrency you are typically lending it to a smart contract on the Ethereum blockchain. This smart contract provides the decentralized mechanisms that allow anyone to lend cryptocurrency to anyone who is looking to get a loan.

Outlet loans stable coins to companies and individuals that are looking for funds to back cryptocurrency loans. In return for providing the capital to fulfil the loan we give the interest rate back to our users.

Cryptocurrency loans are safe. Cryptocurrency loans are required to be over collateralized due to how volatile the asset is. The loans themselves are collateralized at a high rate of around 150-200% meaning that people would have to put up $2 in cryptocurrency for every $1 lended to them. This is much safer in comparison to banks that give mortgages to just about anyone.

Reasons To Take Out A Loan Against Your Bitcoin

People want to take out a loan on their cryptocurrency for multiple reasons. These are a few good reasons why someone would want to take out a loan on their cryptocurrency.

Outlet has the lowest interest rate in comparison to other similar bitcoin loan platforms. Outlet allows you to get cash for locking up your cryptourrency. You can use this cash to buy more crypto to continue trading.

When you typically buy Bitcoin you dont anticipate having to turn it back into cash. It can be a mess between taxes, exchanges, and fees. Taking out a loan gives you the right of owernship over your crypto, but also gives you the USD to pay for anything you would like.

Outlets interest rate is often times much lower than other fiat rates. You can take advantage of the cryptocurrency you own by using it to refinance other debt.

Our product is constantly in a phase of devleopment. If you have ideas or suggestions for the product itself please join our

How We Generate Interest - Understanding what goes on behind the scenes at Outlet.

A way for non crypto people to use a crypto product

There are plenty of crypto products for crypto people. There are a large number of people and USD value using products that allow you to stake or earn interest on your existing crypto. However, these products are only for crypto people.

The interest you would earn using one of these products would be impossible for traditional banks to match, meanwhile lending protocols are doing this in a decentralized way and all you need to do is lend them your cryptocurrency.

The hard truth is that most people do not have crypto and are known as non-coiners. These non-coiners have a common interest in America. They use the United States Dollar, and everyone could use more.

Stable coins are essentially United States Dollars on a blockchain. In the current landscape of cryptocurrency most people use these stable coins to maintain a stable amount in their accounts in the volatile world cryptocurrency.

Stable coin interest rates vs USD interest rates

Stable coins such as Dai and USDC have interest rates far beyond what people receive on their United States Dollars. The average bank account interest rate is 0.09% meanwhile the current average rate of these DeFi protocols is around 14%

Allowing non-coiners to earn these high interest rates

Non-coiners are people without crypto, and most likely do not care enough about cryptocurrency to become a cryptocurrency owner. However, the underlying technology of these lending protocols are useful to anyone looking to get a return on their USD.


Outlet - A practical cryptocurrency app for non crypto people

Outlet is a better bank account built on top of Ethereum. The interest rate we give customers is derived from lending protocols such as 

Users of the mobile app itself will not necessarily know that on the backend the application is a DeFi product unless they look further into the product itself. The app will look, feel, and act like a traditional bank account.

When someone first starts their Outlet account they will be requested to give identity verifying documents like a traditional bank account and be asked to hook up an existing bank account to transfer funds. When someone uploads their funds to Outlet those funds will get turned into Dai and will be supplied to a lending protocols smart contract.

Why is Outlet asking for my social security number?

This helps prevent fraud, and is also required by federal regulations. It also ensures that no one else uses your banking or payment information.

Does Outlet store my social security number?

No, Outlet does not store your social security number. This number is also, not accessible to any Outlet staff.

What happens to my social security number?

Your social security number is securly handled by our partner Wyre Payments Inc, a registered money service business (NMLS ID: 1574869), and is never revealed to Outlet. Wyre is a regulated business, and ensures your information is kept secure, and private. Wyre does not reveal your social security number to Outlet.

Social Security Policy

Lending dai is not a one step process, or is it? This guide is a way for anyone to understand how to lend dai. The traditional way, or the easy way using 

. Lending dai is a way to earn interest on your dai. Since dai is a stable coin equal to $1 lending dai is a fantastic way to earn a return on your dollars. There are a few definitions and terms you need to understand before we break down how to lend your dai and use DeFi and cryptocurrency lending protocols to your advantage.

 - Stable coins are what you would typically lend to a DeFi or lending protocol. These stable coins bring stability to the world of cryptocurrency, They are equal to $1.

 - This is defined differently by everyone, but I would sum it as any way to gain a return on your assets using cryptocurrency in a decentralized manner. Lending protocols enable you to be the bank and back any type of cryptocurrency loan.

 - Dai is a stable coin created by maker. They are the focus of this article. Tying a decentralized stable coin into the mix with decentralized protocols has proven to have product market fit within the cryptocurrency space lately.

Throughout parts of this article we will mention 

 makes all of this as simple as can be. We are a mobile app that enables users to easily lend and earn interest on their dai. We highly recommend that you use 

 when you are lending out dai or supplying dai to some sort of lending protocol on Ethereum.

Assuming you have not yet downloaded the 

 app you can obtain dai on several cryptocurrency exchanges. Some of the most recommended would be Coinbase or Binance. However 

 is by far the easiest to do the second half of this tutorial and will maximize your returns.

You would typically lend your Dia to some sort of protocol. Protocols are some type of debt marketplace where in some way people are issues ing loans of liquidity in some type of capacity. These loans are often overcollateralized. Meaning that if you want to take out a $100 loan you would need to supply far greater than $100 to to take out the loan. This makes these types of loans very safe to back from a financial aspect.

Step by step process on how to lend or supply dai in a lending protocol

 this guide becomes more complicated. You will have to supply dai and go through the rest of the steps, meanwhile 

If you choose to not use outlet you will have to use some sort of wallet, such as metamask to communicate with Ethereum Dapps.

Figure out where you are going to supply your dai to

 - If you want to earn interest on your dai or lend out different assets using a DeFi protocol I would suggest that do your due diligence as to what you are going to do from this point onward. Different protocols have different pros and cons.

The industry leading protocols are compound.finance and dy/dx at this point in time.

 - Once you have selected the protocol you can use their documentation to actually supply their protocol.

Every DeFi protocols is different. The way to begin the process of earning interest starts at the supply phase. You will have to do your own due diligence to figure out what will work best for you.

There are several ways and tools you can use to lend dai there is not necessarily a right answer for anyone. The most popular tools to use Dai currently are Metamask and Compound.finance

We hope that Outlet will be used just as much if not more often that current tools consumers use. You can do what you would need with multiple tools in one tool using 

 - Metamask is a really common web 3 mobile wallet. It is a web first wallet. It will cover everything on the Ethereum blockchain and enable you to interact with any smart contract.

 - Compound is the industry's leading lending protocol. Supplying your dai to compound will yield you around a 12% yield at the moment.

How much interest do you earn lending your Dai?

The amount of interest earned on your Dai varies at any given time and the amount of interest earned varies per platform as well as the method for calculating the amount of interest you earn lending dai.

Currently the best way to earn the most interest on your dai is to use 

 Our platform automatically lends to highest yielding lending protocol in or order to gain the most interest on your dai.

The current interest rate is around 10% when you lend or supply dai to a lending protocols smart contract.

How To Lend And Utilize Dai Like An Expert

The United States Federal Reserve System (FED) has lowered the interest rate once again. Lowering the interest rate comes with a ton of side effects in almost every major industry throughout America.Everyone in America is either directly or indirectly affected by this rate. The effect of lowering the interest rate varies depending on the industry you are in. A great example would be, If you are a bank, you are taking on the same risk for less of a reward, but in theory people will be willing to take out more on their loan due to the lower borrowing rate. This example network effect can be positive, or negative to your particular business depending on the niche. However, the average consumer will be affected in a negative way no matter what.

Lowering the interest rate hurts consumers

The lowered interest rate has a net negative to consumers looking to earn more on their money, and make their money work for them. Banks make less money, and therefore take away from the interest rate they give to their customers.

Banks use your money and put it to use. They use customers funds to safely back loans of their choice. Because banks issue loans at a lower rate, your money earns a lower rate.

Different banks and banking related products have lowered the rate they pay because of this.

Lets take a look at the following example:

Wealthfront. The Wealthfront cash account always has one of the higher interest rates on the market. This past year the interest rate has decreased dramatically for consumers of the product.

Wealthfront Cash Accounts Rate Q1 2019: 2.57%

Wealthfront Cash Accounts Rate Q4 2019: 1.8%

Unlike traditional banking solutions on the market today Outlet is not affected by the feds jurisdiction on the United States interest rate due to Outlet using a dollar alternative, Dai. Dai is a decentralized currency that is equal to $1. $1 = 1 dai. Outlet pays roughly 100x traditional bank account rates. This rate is much more volatile than a traditional bank but, but even banks interest rates change multiple times within a year.

The average interest rate that Outlet pays is roughly 7%. Outlet uses multiple tools in order to achieve this rate, and combines them all in a user experience that feels just like a traditional bank account.

You can download the Outlet mobile app in the iOS app store.

Current Requirements to start using Outlet:

We plan on making our product more widely available to users outside of the United States as soon as possible. If you are seeing this article we recommend signing up or reaching out to see if we opened in your country yet.

Latest Posts

Passive Income Ideas And Strategies

Alternative Savings Apps

The Best Apps To Set Aside Money

Mobile Banking Apps

Money Saving Apps of 2020 and beyond

Investment Recommendations