YFI fired the first shot in mergers and acquisitions in the DeFi field. Although it is not a merger in the sense of the traditional financial market, it is more about the integration and interoperability of underlying development resources. The goals of YFI are also very clear, they are all DeFi projects like Fork. Although we usually look down on these Fork projects, we cannot deny that they do have their own micro-innovations and their own development resources.
For example, the core of the two systems YFI and Pickle, the former is to build a smart pool around Curve, while the latter is to build a smart pool around Uniswap. Putting aside the fact that Pickle was stolen by hackers recently, its TVL can be maintained at 10M US dollars, which shows that it naturally has its advantages. These locked-up funds are not fools, on the contrary, they can be said to be the smartest batch of money.
YFI's merger with Pickle is a horizontal merger, and both belong to the aggregation wealth management track. YFI's merger with Cream is a vertical merger, and Cream is a lending track.
So far, the M&A (Mergers and Acquisitions, mergers and acquisitions) between blockchain projects has officially entered the public's field of vision. YFI seems to have made a good start. The significance of this type of merger lies in the intercommunication of underlying development resources. The status of leading stocks in the field has also been established and gradually strengthened.
An article on index tokens published by Messari recently is worth discussing.
The article begins with US stocks as an example. In September 2019, the share of passive management funds in the US stock market exceeded that of active management funds, because more and more investors are beginning to realize that it is difficult for them to outperform the market. Active investment is time-consuming and labor-intensive, and the effort is often not proportional to the gain. Regardless of the stock market and currency market, I don’t know how many full-time investors there are, but in the end they can get a good death, and how many people have successfully landed. It's just that there is no one in a million, and one will succeed in ten thousand bones.
We can clearly see that mergers between blockchain projects, as well as index funds and passive investment will be the future trend of the Crypto industry. The whole industry is moving closer to the trend of specialization and financialization.
The index tokens in the currency circle also have their own prototypes, with the DeFi index token DPI as a typical example. The DPI index selects 10 DeFi constituent stocks, and adjusts positions among the constituents once a month. The four largest DeFi projects are: YFI/UNI/AAVE/SNX.
How to judge which are the leading stocks in the market. In fact, the index is a very good indicator. Looking at the core constituent stocks of the most mainstream index, they are basically leading stocks. From the DPI index, we can also see that the three leading stocks in the DeFi field are YFI/UNI/AAVE.
Everything that happens in the currency circle is pointing to the traditional financial market.
Many bigwigs in the currency circle now have a long period of experience in the stock market before entering the currency circle. They applied the trading experience gained in the stock market to the early currency circle, and gained the dividends of the times.
There are also many people who first came into contact with the currency circle and have never been in contact with the stock market, such as me. Due to the lack of trading experience, I suffered too many losses. Fortunately, I was not out of the game. I have been in the circle for several years, experienced 17 years of madness, 1819 despair, 20 years of ups and downs, and changes in the entire industry. From the evolution of the currency circle, you can perceive how the financial market has grown from barbaric growth to a mature stage.
If you can survive in the currency circle for a long time, even if you have no exposure to the stock market, I believe you can switch. Because the cores of the currency and stock markets are interlinked. For example, many top investors in the currency circle often switch between the currency market and the stock market.
Fortunately, it is still surviving in this market. Since the stock marketization of the currency circle is a trend, there is no need to worry too much. Even in mature markets, opportunities abound. U.S. A-shares will still produce several 10-fold stocks every year. What the market cleans are only giant babies who want to lie down and win. Just do your own thing. With awe, grow together with the currency circle.
In a sense, witnessing history is more meaningful than making money.
