The alts season that can't sleep recently is back again, and my whole body has gone to life, and the update of this series has slowed down. The new year is coming, change the exaggerated title, be more humble and work hard.
The author is not a professional financial person. This is a non-serious series, focusing on the sorting out of personal thoughts and self-expression. People who read it can just read it casually, and those who write it can write whatever they want.
The author is not a professional financial person. This is a non-serious series, focusing on the sorting out of personal thoughts and self-expression. People who read it can just read it casually, and those who write it can write whatever they want.
Retro
DeFi notes: I rely on time for insurance
new market cycle
It can be observed that the blue-chip DeFi of "ASSY (Aave, Synthetix, Sushi, YFI)" has appeared on Crypto Twitter, analogous to the traditional market, it is FAANG (Facebook, Apple, Amazon, Netflix, Google) or BAT (Baidu, Alibaba, Tencent) growth technology leader.
The characteristic of the leader is that under the premise that the overall market is in a bull market cycle, the strong will always be strong, and it is very difficult for large funds to outperform.
If you can’t beat it, of course you have to embrace it. If you agree that DeFi will be the main story throughout this bull market, what you should consider now is how to get more ASSY chips, not when the next selling point will be.
The market cycle has changed. Looking back at the last round of the market cycle, it can be simplified as follows:
BTC => ETH => ERC-20 => ETH / BTC
In the rising cycle of Bitcoin, ETH, as the leading alts and the largest story container at that time, obtained a liquidity premium, and then ETH flowed into the ERC-20 token as a settlement/private placement unit, and most of the profits will return to ETH /BTC.
In the second wave of DeFi in November, it can be observed that there have been HODLers with ASSY combinations or YFI-based investors. The appearance of "standard" is very scary, which means that the corresponding tokens have been symbolized or religious. We I have heard of "dollar standard" and "gold standard". In the crypto world, I have heard of "BTC standard", "ETH standard", "BNB standard", and of course, "BSV standard".
I don’t want to discuss too much about controversial topics like BSV, and I personally don’t have any opinions. Regardless of whether it is controversial or not, even BNB and BSV have entered the top ten in the market capitalization list, which is beyond doubt.
Taking a closer look at this round of the market cycle, the flow direction has become:
BTC => ETH =>Blue Chip DeFi Project (ASSY) => Tugou DeFi => Blue Chip DeFi and ETH
In the rising cycle of Bitcoin and Ethereum, DeFi projects, as the leading alts sector, have obtained a liquidity premium, which first flowed into blue-chip DeFi, and then flowed into Earth Dog DeFi, and the profit of Earth Dog DeFi was in the second round of DeFi market There are more people choosing the ASSY standard than going back to Bitcoin and Ethereum.
In the last cycle, the class attributes between projects were not so clear, this time it looks different, TVL is the king.
fixed income
articlearticleDivided into two categories:
The product itself includes lending: Yield Protocol, Notional, both of which are still in the testing stage
The product itself does not include lending: Barnbridge, Saffron, 88mph, Horizon Finance
It seems that there are many players on this track, and the principle is basically based on interest rate swaps (the impression is that there is a rebase mining income, but I can’t find it, and it is probably cold). In fact, only 88mph really has usable products, and most of the others are still Not online, the Saffron contract vulnerability caused 80 million DAI to be locked.
I personally think that this type of product will eventually return to protocols such as Aave and Compound. Although 88mph was incubated by Aave, it is not bad.
Algorithmic Stablecoins
Algorithmic Stablecoins
AMPL => YAM => ESD => DSD => Basis Cash => BASE、Badger
Ignoring the first two, starting from ESD, we have now reached the third and fourth forks. Unless there are risk-free mines, I feel that it is not worth fighting for. However, these DeFi markets have iterations of algorithmic stablecoins. take a look.
ESD
The project started in September, after a period of rapid development, the current market value has stabilized at 110 million dollars, but the design of the ESD coupon is not perfect, which has led to a long-term stalemate.
mechanism:
Destroy ESD below 1 yuan to get a coupon (with a validity period, currently 30 days), and you can get more ESD when inflation occurs in the future
Additional issuance of more than 1 yuan (similar to AMPL), the additional issuance part will be given priority to repay coupons, and the rest will be distributed to governance pool staking users and Uniswap market-making users
question:
question:
The big holders of ESD want to monopolize the inflation rewards and keep the price at 0.9*, so that the profit margin of the current purchase of coupons is reduced, and at the same time, the profits of the previous purchases of coupons are made to expire. Coupon is the life-saving tool of the death spiral. As a consensus currency anchored to $1, not allowing this part to be cashed out and making it expire is equivalent to consuming the most important consensus.
There is no highly liquid coupon trading market. At the same time, because a maximum of 6% of the total coupons can be dealt with each time, the redemption needs to compete with robots and continue to consume consensus.
The on-chain voting update mechanism leads to inefficiencies.
DSD
The first fork of ESD has modified some parameters, such as automatically adjusting the number of liquidity pools to ensure that the price of each epoch can be reduced by up to 1/12 to prevent a rapid death spiral. The current market value of DSD is 2.7 million, and the peak market value is more than 5 million. .
Basis Cash
In fact, ESD is not the first product made with this idea, but it is the first to make a fair launch this year. ESD is an improved fork of a project called Basis in 2018, which was stopped by the SEC at that time. And Basis Cash is the Community Edition reboot of the project.
The core difference from ESD is that three coins are used:
Basic Cash
Basis Bond, corresponding to ESD coupon
Basis Share, corresponding to the governance pool Staking income object of ESD (ESD is direct inflation)
In addition, a bond vault was introduced to solve the problems caused by the ESD coupon design
Due to a bug in the rebase contract, there has been no rebase yet, and the current market value is around 10 million.
Base
In fact, the relationship between Base and ESD is not very big. It is a wilder AMPL. The rebase is not determined by the US dollar, but the total market value of the entire encryption market. After a ten-fold increase in a day, a rapid death spiral, the rules are roughly as follows:
If crypto market cap is $450B, BASE is $0.45.
If crypto market cap is $800B, BASE is $0.80.
The rebase object is a fixed percentage of the total market capitalization of the crypto market.
Badger
The first product: Smart Pool for Bitcoin on Ethereum
The second product: rebase coin, price riveting bitcoin
Airdrops are very popular, but the capital pool is very small, and it is a failure in terms of cold start.
What's Next?
Although the algorithmic stablecoin is considered a scam by many people, there are naturally some points worth studying.
If you want to say that algorithmic stablecoins are consensus coins that believe that they are worth $1, in fact USDT is not fully guaranteed. The current algorithmic stablecoin is only a limit state between full security deposit and zero security deposit. The follow-up story Mainly look at two aspects:
Will there be some rebase coins to increase the application scenarios?
When Are Algorithmic Stablecoins in the Hybrid Phase?
@billtheinvestor: Unsecured stablecoins may go through three phases:
2. Simulate the US dollar bond mechanism stage, such as ESD/BASIS
2. Simulate the US dollar bond mechanism stage, such as ESD/BASIS
3. In the mixed stage, it should be part mortgage + part bond market regulation
Personally, I think it may be the next alts season in terms of time, will you participate or not?
Hasu, a well-known cryptocurrency researcher, said: There are only two types of people playing the Ampleforth project, "those with an IQ of 140 and those with an IQ of 60."
IOS
Android