The future of financial services never stops, and the bull market continues

Today I will continue to share with you an article about overseas investors. The following is my translation and understanding of the second half of the article.

If you can't bear a 60% plunge, you are not eligible to reap a 6000% surge.

In the face of the market's plunge, where does our inner pain and anxiety come from? I think that only by understanding the source of our inner pain can we better face and deal with it.

The pain comes from the plunge of the market, which often exceeds the limit we can bear, forcing us to cut our flesh.

For example: We have invested too much money in this field, and the loss of these funds is something we cannot afford.

Another example: We used too high leverage.

Another example: In addition to digital currency investment, most of our investments in other fields are very illiquid, so that when we need money, we have to reluctantly sell digital currency.

Therefore, when the market plummets suddenly, we have to be forced to cut meat.

Did we buy coins with money that should have been used to pay rent for June? June 1st is coming soon. If we lose 40% of the money that should have paid the rent, in order to pay the rent, we must not only sell the coins in our hands, but also raise additional money to make up for the shortfall in rent.

Are we using leverage? When the market reaches the limit of leverage liquidation, in order to keep our position, we must sell part of the position or continue to call for margin.

In such a situation, when the market plummets, we suffer.

The price of digital currency fluctuates so violently because the size of this market is too small compared to the traditional investment market to support large-scale transactions. Therefore, when large-scale liquidation occurs, market runs occur, and people flee in panic. Stepping on each other, the market collapsed at an accelerated rate...

DeFi crushes the market, CEX cannot cope with the market

In this plunge, we have also seen some positive phenomena.

Someone on Twitter asked this question: Is no one discussing the performance of Ethereum's DeFi in this plunge?

There is no doubt that during the plunge, DeFi also crushed the market and hit the market. The last time (March 12, 2020) we saw such a plunge was when the new crown epidemic was rampant. But at that time, many DeFi projects with star halos failed to stand the test of the market. But this time, DeFi (in terms of total locked positions) is 80 times that of last time, but what we see is an orderly look:Every DeFi project is operating in an orderly manner, everything is as the designer envisioned, and every action is as written in a smart contract.

These projects have withstood a 40% drop in 24 hours, and they are amazingly strong today. From here, I see a brighter, greater future.

The calmness and calmness shown by these DeFi projects far exceeds the panic and anxiety shown by those investors who invest in them. At the same time, DeFi competitors ----- those traditional centralized exchanges have collapsed. Numerous exchange users rushed to the exchange to conduct various transactions in a very short period of time, which caused the exchange's servers to be overwhelmed and malfunctioned. Coinbase, Binance US, Gemini, Kraken, Bitstamp...all of them.

This is the power of the world computer (note: this refers to Ethereum) and the never-ending network it carries!

The future of financial services never stops!

The market will weed out those outdated old models, no matter how powerful they were!

We look forward to the second half of the bull market with hope and confidence!