Interesting view. I wonder if we will see a neat difference between DEFI and CEFI. So far DEFI has not been involved directly in the mess of the latest scams, just indirectly suffering the spill over. This is just my personal understanding of the actual situation. Would love to hear what you guys think.
What do you think would be a sustainable APR on a DEFI protocol with auto compounding contracts outside of a bear market where the APR is coming from revenue due to actually using the protocol like Curve or Uniswap if 20% is clearly unsustainable?
Rates will depend on market conditions, also free capital flows between tradfi and defi. I don't think 20% riskless is anywhere close to possible. Spreads of a few percent between tradfi and defi are already decent, my understanding is that rates on lending stables very safely are already around there - once considering depeg risk, makes sense... Of course, there's a risk-return tradeoff. 20% just means there's sufficient risks to justify paying 20%. tldr, hard to say.
Thankyou for replying. When you reply please write in a normie friendly way. I’m finding a lot of smart people write in a way that’s very difficult to understand. But I appreciate your response non the less. 😇
Nice piece. What are you thoughts on the influence of VCs and pre-sale investors? In legacy finance, users can't pump their bags, except indirectly from using/buying products and services, or perhaps as participants in later rounds or buying the IPO. In crypto, users essentially provide immediate liquidity for them to cash out as soon as their tokens unlock.
Thanks! Yes it's interesting, the VC payoff structure (hand bags to the next investor, or retail) may also be a driver of the growth hacking trend, hadn't thought of that, but that makes a lot of sense
I don't know, it's just an idea. I have a feeling the speculative enthusiasm probably had a lot to do with it. Shilling in a bear market doesn't seem to work as well and growth hacking is tough when "nobody" seems to care.
I'm going to mention this article in my weekly rundown, thanks for posting it.
Interesting view. I wonder if we will see a neat difference between DEFI and CEFI. So far DEFI has not been involved directly in the mess of the latest scams, just indirectly suffering the spill over. This is just my personal understanding of the actual situation. Would love to hear what you guys think.
What do you think would be a sustainable APR on a DEFI protocol with auto compounding contracts outside of a bear market where the APR is coming from revenue due to actually using the protocol like Curve or Uniswap if 20% is clearly unsustainable?
Rates will depend on market conditions, also free capital flows between tradfi and defi. I don't think 20% riskless is anywhere close to possible. Spreads of a few percent between tradfi and defi are already decent, my understanding is that rates on lending stables very safely are already around there - once considering depeg risk, makes sense... Of course, there's a risk-return tradeoff. 20% just means there's sufficient risks to justify paying 20%. tldr, hard to say.
Thankyou for replying. When you reply please write in a normie friendly way. I’m finding a lot of smart people write in a way that’s very difficult to understand. But I appreciate your response non the less. 😇
Nice piece. What are you thoughts on the influence of VCs and pre-sale investors? In legacy finance, users can't pump their bags, except indirectly from using/buying products and services, or perhaps as participants in later rounds or buying the IPO. In crypto, users essentially provide immediate liquidity for them to cash out as soon as their tokens unlock.
Thanks! Yes it's interesting, the VC payoff structure (hand bags to the next investor, or retail) may also be a driver of the growth hacking trend, hadn't thought of that, but that makes a lot of sense
I don't know, it's just an idea. I have a feeling the speculative enthusiasm probably had a lot to do with it. Shilling in a bear market doesn't seem to work as well and growth hacking is tough when "nobody" seems to care.
I'm going to mention this article in my weekly rundown, thanks for posting it.