How To Earn Free Polygon Matic on AAVE

Are you looking to earn free Matic with your cryptocurrency?

Instead of keeping your crypto assets on your wallet doing nothing, why not earn some interest by leveraging the power of decentralized finance apps?

One of the easiest ways to earn free Matic rewards is to harness AAVE’s Polygon market.

In this guide, I will show you how to earn free Matic tokens on AAVE using the Polygon network.

In this article you will learn:

• how does staking on AAVE works
• how to earn Matic on AAVE
• how to claim your Matic rewards

What is AAVE?

AAVE is a decentralized, non-custodial liquidity protocol offering depositing and lending.

AAVE in partnership with Polygon started offering Matic quick rewards.

By depositing your assets to AAVE on the Polygon market, you can provide liquidity on AAVE protocol - in return, AAVE will reward you with additional earnings on your deposited asset and Matic rewards.

What is Polygon?

Polygon network is a side-chain protocol that runs parallel to the Ethereum chain. It was created as a layer 2 solution to address Ethereum scalability issues.

Your Ethereum address also exists on the Polygon chain - this means, the same Ethereum address can be used to transfer assets to on Polygon network.

What is APY?

APY stands for Annual Percentage Yield - a gain percentage on the deposited assets.

Here is the APY formula:

APY = (1 + r/n ) ⁿ – 1

What is AAVE’s APY interest?

AAVE interest varies from coin to coin - the highest deposit APY interest will be on Matic and USDT.

The APY interest for depositing Matic fluctuating between 3 to 6% for standard APY + 4-6% in additional Matic rewards. This means, that just for depositing your Matic, your annual percentage yield could be as high as 12%. Mind that this is annual yield, not daily.

Scenario #1

You deposited 10 000 MATIC, the base APY is 4% and additional Matic rewards provided by AAVE is 5.50%.

10 000 * 9.5% = 950

950 / 365 = 2.602739726

That means, on 10K Matic with a total of 9.5% APY, you will be earning 2.6 Matic a day.

What if you decide to deposit a stable coin like DAI? Let’s do the quick math again.

Scenario #2

You deposited 10 000 DAI, the base APY is 2.70% and additional Matic rewards provided by AAVE is 4%.

Since you will be earning DAI and Matic rewards separately, we need to calculate APY for each separately:

10 000 DAI * 2.70% = 270

270 / 365 = 0.7397260274

That means, on 10K DAI with 2.70% APY, you will be earning 0.739 DAI a day.

But you also earn 4% in Matic rewards! So let’s calculate that one quickly too:

10 000 * 4% = 400

400 / 365 = 1.095890411

So, on top of your 0.739 DAI a day, you will also earn 1.09 Matic a day - not bad!

How to earn Matic on AAVE: Step by Step

Here is the step-by-step guide showing you how to set everything up.

Step 1: Research what asset you would like to deposit to AAVE

On the “Markets” tab you can quickly lookup supported markets and their corresponding APY.

Usually, the choice boils down to whether you want to deposit cryptocurrency like Matic, Wrapped ETH, or stablecoins like DAI and Tether (USDT).

In general, stablecoins are a safer bet because they are not prone to volatility like normal cryptocurrency is but they have lower APY and rewards.

The only stable coin that offers higher APY is USDT, and this is due to the fact that USDT is not audited hence there is a slight security risk in using it.

On the other hand, you can deposit crypto, like Matic, WETH (Wrapped ETH), or WBTC (Wrapped Bitcoin) - with higher APY but also a higher risk of volatility.

The risk won’t matter much if you only plan to deposit and not use this deposit as your collateral for borrowing.

The best of both words - low risk and high reward you will get by depositing the Matic token.

Step 2: Get Your Assets on Polygon Mainnet

Once you decided what asset you would like to deposit, it’s time to transfer it to the Polygon mainnet.

In order to use AAVE Polygon, you need to have your coins on the Polygon mainnet.

If you currently don’t have any assets on Polygon / Matic network, you can transfer your funds from the Ethereum network to Polygon mainnet via the official Matic bridge.

In case you have assets on the Binance Smart Chain (BSC), you can also transfer them directly to the Polygon mainnet using one of the available BSC to Polygon bridges.

Just remember to keep in mind gas fees if you are transferring the funds from the Ethereum mainnet to Polygon. Here I recommend it to do it when the gas fees are low.

Assuming you have some ETH on the Ethereum chain, the quickest way would be to buy Matic and move it to the Polygon chain via Polygon Bridge.

Step 3: Connect MetaMask to AAVE

This step requires

Step 4: Deposit Your Assets to AAVE Polygon chain

Once you have your MetaMask connected, you can now click “Deposit” to deposit your assets to AAVE. They will be deducted from your wallet balance of course as you are moving the coins to AAVE.

Step 5: Claim Your Matic Rewards

As time passes, you will notice two things:

• your base deposit raises
• you get Matic rewards

You could deposit your Matic rewards to AAVE to gain interest on them too or simply move them to another coin.

Earn Matic on AAVE: Final Thoughts

AAVE’s Polygon market is a great opportunity for those who want to tap into decentralized finance and enjoy additional returns on their crypto assets.

It’s a great alternative to riskier yield farming and the good reputation of AAVE helps you to sleep well.

I hope this guide was useful. Enjoy your Matic rewards!

Earn Matic on AAVE: Frequently Asked Questions

Here are some common questions people ask me about earning Matic on AAVE.

Do I need to use Polygon mainnet to earn Matic?

Yes. Currently, the only way to earn Matic is to use AAVE on Polygon.

Do I pay fees when I want to claim my Matic rewards?

Yes. The gas fees are 0.0001 Matic which are tiny compared to the one on the Ethereum chain.

Can I deposit assets from Binance Smart Chain to Polygon?

Yes. You can use BSC to Polygon bridge for that.

Can the AAVE deposit APY be locked?

Currently no. The APY will constantly change depending on the market’s conditions.