What stage is the current DeFi investment opportunity?

This round of surging DeFi tide came very suddenly, which made many friends who did not get on the bus in time panic. In fact, not only a large number of retail investors have not kept up, but many investment institutions and industry veterans in the currency circle are still in a relatively passive state.

During this round of DeFi tide, we have seen the following two special phenomena:

One is the lack of some heavyweight figures.In the past, every time a hot spot in the currency circle was launched, there would always be some senior big names who came out to support various projects and advocate various trends, but this time we did not see these big names.

Is it their indifference to DeFi? I don’t think so. It’s because they really haven’t kept up. It’s not that they don’t want to keep up, but that their previous advantages can’t be used in this tide, so they can’t keep up. Because a notable feature of this DeFi tide is that the project party no longer needs to rely on the endorsement of any big names or institutions to list its currency.

Since the emergence of decentralized exchanges (DEX) such as Uniswap, any project party can list coins on DEX, so all hidden costs such as celebrity platforms required for listing coins in the past are due to the emergence of decentralized exchanges DEX The resulting freedom of listing currency and freedom of trading will be completely eliminated.

Moreover, many "demon coins" in this round were not endorsed by anyone, had no platform, and did not have any background before they became a blockbuster.

The second is that all heavyweight exchanges are late in this round of DeFi tide.At the beginning, those who were sensitive to DeFi were the second- and third-tier exchanges, and they were tracking the new coins and projects of DeFi in a timely manner; and the DEXs were actually earlier than these second- and third-tier exchanges. Many current star coins were first traded online in DEX instead of traditional centralized exchanges. Why? Because the listing of DEX does not require any threshold, let alone the listing fees of traditional centralized exchanges.

Let's take the recent popular project Aragon as an example. As early as last December when I started to pay attention to it, its price was only between US$0.4 and US$0.5. Decentralized exchange (DEX) trading. The three major exchanges have only recently launched its trading.

If investors who are a little concerned about Aragon do not need to rely on the three major exchanges at all, they can buy it on the decentralized exchange (DEX), and then wait for the three major exchanges to list the currency, driving up the price of Aragon.

The most popular view in the currency circle recently is: "Ethereum miners harvest farmers' fees, farmers harvest uniswap leeks, uniswap leeks harvest small exchange leeks, and small exchanges leeks harvest the last three major exchanges that are listed". Although this sentence is a bit extreme, it reveals a notable feature of the current DeFi tide.

Now the real senior players will not go to the three major exchanges to find potential coins, but will look for potential investment products on the Uniswap currency list. If you want to wait for the three major exchanges to list the currency, this coin has been changed hands many times. up.

So for ordinary investors, should we keep a close eye on Uniswap's listing list? I think that if you have time and energy, you can do this, but even after seeing the list of listed coins, it is still quite time-consuming and labor-intensive to analyze the authenticity and investment value of these coins one by one, and many people simply cannot do it.

So what should we do?

I think that each of our investors should do in-depth research in one of the many categories of DeFi according to their own preferences, grasp the latest projects in a certain segment, and study the latest projects.

Specifically to myself,I'm paying particular attention to decentralized exchanges (DEXs) because I think it will be the next infrastructure of the blockchain.At present, giants that have emerged in this field include Uniswap, Balancer, Curve, Bancor, 0X, Kyber, etc. I will not buy all of these coins but will choose the ones I am optimistic about, stick to the point of view of long-term investment, increase my position in a timely manner when the price of the currency plummets, and prepare for long-term holding.

So what stage has DeFi developed in full swing now, and how will it develop in the future? I think it is still in the early days, but it has to go through one or even multiple deep corrections to knock out a considerable number of retail investors before moving on.

For the DeFi bubble that many people worry about will burst immediately, I think there will be a deep correction in the short term, but it will not burst for the time being. Why? Because some big organizations have not yet found the opportunity to play, when these big guys come to the stage to call for orders, we should be highly vigilant.