Sushi squatting kimchi squatting thousands of times stunned everyone, V God revealed his worries about DeFi mining

Editor's Note: This article comes fromHot Wheels Community (ID: FHBT18), Author: Pepe, reproduced by Odaily with authorization.

Hot Wheels Community (ID: FHBT18)

, Author: Pepe, reproduced by Odaily with authorization.

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kimchi kimchi If you haven't heard the name in the defi circles by now it's probably because it didn't exist when we posted just yesterday but that doesn't stop this kimchi bro from being crazy initially, I see it now It may be too late."text"text

defi farming

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We have no empirical evidence to explain all this. We can only say that we still pay attention to safety. However, when we checked the data of kimchi today, we found that the recent wave brought about by sushi and even TRON defi is really old leeks.

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This is not a series of making friends out of nothing, or just feeling in the group, but a real record on the chain. Here I share a very interesting address:

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1. On-chain collateralized lending—that is, leverage

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We have talked about this before, which is the earliest story told by BitShares. Mortgage asset A to obtain a certain percentage of asset B. Here, a leverage is created. As long as A is not liquidated, A is yours, and B can be disposed of at will. For this, you only need to pay a small amount of interest, and this part of the interest will be given to users who deposit money on the platform.

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This is a platform we are familiar with, and this wave of DeFi has really brought about the enthusiasm for liquidity mining-compound.

His family is still doing loan mining, but the annualized income (as shown above) has dropped to a normal level.

2. Liquidity mining - that is, building an AMM dex

The backside of liquidity mining is actually to build a decentralized trading platform that is priced through automatic algorithms. Its goal is to facilitate the exchange of various tokens on the chain, and at the same time distribute transaction fees to all funds. The pool is a market maker that provides liquid assets, and it is this profit that drives many investment speculators to invest their funds in it.

It’s just that in addition to the handling fee, token rewards are added now, and the short-term market value of such mining tokens determines the annualized income that can range from a few times to dozens of times in the eyes of the outside world.

1 and 2 also brought fire to the YFI smart pool, which is equivalent to a "valet mining pool", which is dedicated to finding projects with better security and better returns in 1 and 2, and constantly participates in and in Which switches to provide rewards to the user.

3. Automatic Algorithmic Tokens

Since the exchange can be realized through algorithms and break the centralized monopoly, the tokens can also break the centralized issuance of the project party, and everything can be increased or decreased as needed. The starting point of this block is ampl, of course it is not real In the sense of decentralization, the project party still has bargaining chips in its hands. There are actually very few such tokens now. Except for imitators, there should be a lot of room for development in the future.

Among these three stories, the main ones are 1 and 2, and 1 is the leverage bull. This should be said that we experienced a wave in 2019, but now it is transferred to the chain. Of course, if we talk about a larger increment, it is still in 2 .

Because every time a liquidity mining pool is opened, it means that a certain amount of tokens must be mortgaged. It should be said that the explosive growth of many tokens this year is locked out little by little.

Then why do people lock it in, because there are greater interests that are tempting, where does this greater interest come from, yes, it comes from the constantly increasing mining tokens that V God said, then why can they How about such a high market value?

Because there is a nesting here, each of these mining coins also has their own liquidity mining pool, such as sushi/eth. In many cases, the income of this pool is the highest, so many players have dug up the coins and directly mortgaged them. Yes, the secondary market sells less, and there is more heat, so naturally the price will not fall.

In addition, the entire market is in a state of steady growth, especially the price of btceth, which forms a positive cycle, liquidity injection, currency prices rise, everyone is making money, causing more liquidity injection, now in Defipulse I It can be seen that the lock-up assets have been counted as 9 billion US dollars.

But the question here is, can this cycle go on forever? There is a word called the same origin of profit and loss. The growth logic generated by how may also be the source of collapse in the future.