What is auto compound crypto?

Auto compound crypto protocols are DApps that automatically collect and re-invest rewards you receive when you deposit your funds into a liquidity pool. As you accumulate liquidity pool profits (usually as liquidity provider rewards tokens) the protocol claims the rewards, exchanges them for pool tokens and reinvest them on your behalf.

What is compounding interest in crypto?

Therefore, compounding interest in crypto entails putting back the interest you gather from your investment to increase your earnings. Depending on the coin one chooses, the annual income from compounding will vary. Having a reliable platform to back up your endeavors will be best to protect the future of your investment.

What is an auto compounder?

An auto compounder takes the thinking out of it and allows you to set it and forget it. There are risks involved with DeFi and any smart contract. When using an auto compound protocol you must sign an additional contract and allocate your funds to the protocol.

What is an auto compound protocol?

When using an auto compound protocol you must sign an additional contract and allocate your funds to the protocol. This introduces contract risk that does not exist if you were to compound your returns on your own.