Personally I think it's great! But I think the risk should be made aware to all investors who attempt to enter the space. In this answer, I will assume only CeFi platforms like Celsius, BlockFi, Hodlnaut etc.
Firstly, is platform risk. Platforms can get hacked and not all are covered by insurance. Most if not all banks are insured by respective insurers to certain predefined limits. On the other hand, not all crypto earning platforms are covered. Moreover, there is no guarantee how long the insurance will take to pay out as crypto insurance is still a relatively new space. That said, by choosing well established platforms with good track records (e.g., Celsius, Nexo), this risk can be minimised greatly.
Secondly, stablecoins, despite the name, can actually not end up being stable. Stablecoins regularly fluctuate in value although for the more well-known ones (USDT, USDC, BUSD), the fluctuations tend to be small (usually at the third decimal point and beyond). However, what is more important is what your stablecoins are backed by. Recently, USDT revealed that only a small portion of their reserves are in cash and a large portion in 'commercial paper'. This stirred a bit of uncertainty in the crypto world (although rumours of this has been around since as long as 2017). So do read up on the company that supplies the stablecoin that you intend to hold and what it is backed by. Personally, while USDT is the largest market cap stablecoin around, I'm more of a USDC guy myself hahahaah.
Now if you want to look into DeFi yields, then you'll have a lot more risks to look at, namely, rug risk, smart contract/exploit risk, depegging risk (DeFi has a lot of funky stablecoins, IRON being the most recent failure lol). That said, the yield of course, tends to be much juicier (think 2-4x higher than your standard CeFi platform).
Hope this helps!
Personally I think it's great! But I think the risk should be made aware to all investors who attempt to enter the space. In this answer, I will assume only CeFi platforms like Celsius, BlockFi, Hodlnaut etc.
Firstly, is platform risk. Platforms can get hacked and not all are covered by insurance. Most if not all banks are insured by respective insurers to certain predefined limits. On the other hand, not all crypto earning platforms are covered. Moreover, there is no guarantee how long the insurance will take to pay out as crypto insurance is still a relatively new space. That said, by choosing well established platforms with good track records (e.g., Celsius, Nexo), this risk can be minimised greatly.
Secondly, stablecoins, despite the name, can actually not end up being stable. Stablecoins regularly fluctuate in value although for the more well-known ones (USDT, USDC, BUSD), the fluctuations tend to be small (usually at the third decimal point and beyond). However, what is more important is what your stablecoins are backed by. Recently, USDT revealed that only a small portion of their reserves are in cash and a large portion in 'commercial paper'. This stirred a bit of uncertainty in the crypto world (although rumours of this has been around since as long as 2017). So do read up on the company that supplies the stablecoin that you intend to hold and what it is backed by. Personally, while USDT is the largest market cap stablecoin around, I'm more of a USDC guy myself hahahaah.
Now if you want to look into DeFi yields, then you'll have a lot more risks to look at, namely, rug risk, smart contract/exploit risk, depegging risk (DeFi has a lot of funky stablecoins, IRON being the most recent failure lol). That said, the yield of course, tends to be much juicier (think 2-4x higher than your standard CeFi platform).
Hope this helps!