DeFi Yield, Impermanent Loss & Liquidation Cascades
On-chain yield is never free — it is payment for risks most retail traders never name. Here are the three that bite hardest.
DeFi — decentralised finance — lets you lend, borrow, and provide liquidity through smart contracts instead of a company. The pitch is yield: deposit your coins, earn a percentage. The reality is that every yield is payment for a risk, and on-chain those risks are sharper, faster, and harder to exit than anything in a normal brokerage. This lesson covers the three that do the most damage to retail traders: impermanent loss, liquidations, and the cascades that link them during a crash.
Impermanent loss: the cost of being a liquidity provider
Log in to continue this lesson
This lesson is part of the full Academy curriculum. Log in to read it in full, track your progress, and earn certificates.
New here? Logging in covers the whole Academy — the first lesson of every course is free to preview.