Usual disclaimers: We are not financial advisors, the methods explained on this page are not guaranteed to net you a benefit, it describes some of the opportunities on the Zero Exchange platform to earn more.
On the Zero platform, there are several ways to earn without investing more than your initial investment.
Three possible strategies with your current ZERO asset without investing more capital:
- Hold your bag of ZERO, wait for it to rise in price and sell for a profit
- Try to gain more Zero with scalping: Trade often by buying low and selling high
- Farm ZERO by entering one or more liquidity pools
Series of Youtube tutorials to learn about how to use the exchange: The Zero DeFi Academy
Links to some FAQs are registered in the explanations further down.
Do the traditional "buy low, sell high" routine, with ZERO or other tokens available to trade on the exchange:
- On the Ethereum chain: The available tokens are exactly the same as the ones on Uniswap.
Uniswap can be replaced entirely by the Zero Exchange when trading on Ethereum.
- On BSC and Avalanche: Limited to tokens supported by the Zero Exchange
Trading fees on the chains from lowest to highest: Polygon > BSC > Avalanche > Ethereum
- Price fluctuations: You can't buy back lower than what you sold for.
- When trading on the Ethereum network: Transaction fees. You may want to offset the transaction fees costs with a big enough value of the trade to make it worth, unless you are betting on a future big multiplier in price of the token you are buying ;-)
As a DEX, one of the primary function is to have and to generate enough liquidity for trading operations and other features requiring the ZERO token.
You can enter a liquidity pool to farm ZERO tokens for the Exchange and you are rewarded in return with ZERO tokens:
- Liquidity pools are paired tokens in a pool: Provide a pair of tokens with equivalent dollar value of each at the time of entering the pool. Most liquidity pools on the Zero Exchange are paired with ZERO, as to generate ZERO tokens that you collect as rewards. Note: Some pools emits other tokens than ZERO. Rewards are earned as soon as you enter and stop once you exit: The longer you stay, the more you earn.
- A liquidity pool is subjected to a contract: Which paired tokens, when it starts, when it stops, how much tokens of one of the pair are farmed per week. When you enter a pool, you get a share of the pool, because others are also in the pool. Your share will depend on how much in dollar value your share is worth, compared to the total dollar value provided by all liquidity providers of that pool, and it varies in functions of others entering/exiting the pool and how much they put in the pool.
- On the Zero Exchange, there are many pools to chose from on the different chains, with various levels of Annual Percentage Rate (APR) return.
- Zero is partnered with other projects: Liquidity pools are avalaible with Zero as a pair, but farming the other paired token (like Gondola Finance, ChartEx, WISEB for example)
- Entering/exiting pools are subjected to fees paid in the native token of the chain like for a normal trade. As usual, from the cheapest to the more expensive chain: BSC > Avalanche > Ethereum
What to do with the rewards:
- Claim to accumulate/hold in your wallet
- Compound back in the same pool: Claim them, swap half of them to the other paired token, and add more liquidity (> to raise your share of the pool to earn more rewards)
- Sell your rewards to another token/stable coin like USDT for profits
Risks: Please learn about Impermanent Loss
- How to manage liquidity pools
- Entering a liquidity pool
- Withdrawing LP tokens from a liquidity pool
- Retrieve tokens from LP tokens
- Claim rewards from a liquidity pool
"Arbing" between chains
Since the exchange is connecting several chains and trading is done on the different chains, there are often temporary price differences between chains for a same token. The prices stabilises by people buying/selling on different chains to take advantage of these differences.
Arbing between chains involves the traditional trading, but you add the cross chain functionality as well.
An example of arbing with the Zero token:
Price of Zero on the BSC chain: 35c
Price of Zero on the Avalanche chain: 33c
High level steps:
- On BSC chain: Swap ZERO to USDT
- Cross chain USDT to the Avalanche chain
- On the Avalanche chain: Swap USDT to ZERO
=> Now you have more Zero for the same capital 🙂
=> And then continue these operations back and forth between the different chains => The arbing is not necessarily limited to the ZERO token, but to all tokens available on the different chains
To make it worth: You have to do it with rather big volumes to offset the bridge costs when some chains are involved like Ethereum (and in a much lesser way, Avalanche)
You can also try to arb by trading on other exchanges than Zero, by using the cross chain feature (see the FAQ related to that).
Risks: That the cheaper price on the chain you targeted changes during the arbing action and is not low enough to make it a profitable trade anymore