Among the stablecoins, DAI may have the most potential. In the field of decentralized exchanges, Uniswap is unmatched in long-tail asset pricing, but it may be overvalued.
Original Title: “DeFi Midfield Research Report”
Written by: Lin Ming, Co-founder of FirstPool
After the hustle and bustle, the entire market has quieted down. DeFi has not yet reached its climax. DeFi’s TVL is still in a stage of rapid growth, and industry innovations are changing with each passing day. However, the upward fluctuation of currency prices has slowed down. DeFi has entered the intermission stage. Think more about who will stay in the future. Analyze from different fields.
Stablecoin
The three core points of the stablecoin market:
- The issuance of the market, stable currency is a strong market, the scale of stable currency determines the recognition of the market, trading pairs and OTC are inseparable from the development requirements, USDT is undoubtedly the king, USDC and DAI Accelerated development.
- Recognition of pledged assets. The issuance of stablecoins depends on the assets behind them. USDC relies on the endorsement of U.S. dollar assets, and DAI relies on the pledge of digital currency assets. The most stable asset is USDC, but USDC and USDT have frequently frozen account events, and DAI has undoubtedly the highest comprehensive advantage.
- The stability of the team. The stable currency market does not rely on excessive innovation, but on the stability of the team. Innovative assets such as MUSD and AMPL are also more gimmicks. The real stable currency market must lag innovation and advance the stability of the team. USDT is still Suffering from litigation, the USDC and DAI teams have become more stable.
The stablecoin market is more optimistic about DAI. From the 100 million issuance at the beginning of the year to the current 900 million issuance, from 0 to 4%, the fees charged by the 900 million DAI will be used to burn MKR, only 560 million The market value of MKR is undoubtedly an undervalued DeFi asset. And MKR also comes with oracles, exchanges, and even multiple projects such as online lending products.
Decentralized exchange
As DeFi’s largest cash cow, DEX market competition can be described as fierce. It is a completely innovation-driven market. The core of DEX has three points:
- From the perspective of a trader, the best exchange price and the lowest slippage must coexist. The solution is to join the stable curve, that is, to enlarge the asset multiple at a certain exchange price point. CURVE The manifestation is very obvious.
- From the perspective of market makers, the lowest permanent loss and the highest profit. The permanent loss can be solved by using the oracle to feed the price. DODO is the most obvious. The highest gain is not only the handling fee, but also the return that depends on the TOKEN model. SUSHI used the TOKEN model to attract a lot of traffic from UNI a few days ago.
- From the perspective of handling fees, GAS fees are a difficult problem that DEX must face. ZRX, through the on-chain and off-chain combination mechanism, only needs one APPROVE with a very low GAS fee to solve it, and then the signature can be done without the GAS fee.
From an investment point of view, I do not recommend that you invest in DEX. Qiansan fee is indeed very attractive. However, the DEX market has frequent black technologies. TOKEN model innovation, technological innovation, and collective innovation are ubiquitous. For DEX, what I can suggest is Under the current transaction scale, although UNI has unmatched pricing power in long-tail assets, it is still overvalued. ZRX’s technological innovation is strong and its value is relatively undervalued. However, the head of the DEX market is changing, and today’s king may be trampled underfoot in a few months, such as Kyber.
Gather reasonable money
I have written a lot of articles about yearn in Jurongcai, but at the end of September, I was no longer optimistic about Jurongcai. Gathering is a market driven entirely by strategic innovation and technological innovation, with only one core: financial income. However, FARM has cooled down, and risks still exist. Gathering reasonable wealth is facing a problem. Safe and high-yield projects are currently flooding with excessive funds, and returns have fallen. New high-yield projects have the same high risk of loss and require rapid response to strategies, but Often the strategy is well developed and the project is already cold. Even for UNI mining, it is very difficult. It requires the cooperation of mature futures and options markets, which will dilute and dilute the income. The market for gathering rational wealth has quickly cooled down after insufficient innovation. Be cautious about the leading yearn suggestion, the direction of AC has been biased towards new projects and NFT.
Lending market
The lending market is more like a mine. This mine has accumulated a lot of resources. There are two core points:
- TVL is the storage capacity of the mine.
- Team innovation and execution.
For example, LEND is very simple to develop a DYDX, and the funding rate must be optimal. The resources accumulated in this mine can be continuously expanded upstream and downstream, and can be used for stable currency upwards and leverage, futures, and financial management downwards. The lending market is an untapped gold mine. Compared with the safe and conservative COMP, LEND is more optimistic about the team’s innovation and execution.
For the DeFi market, it seems that there will be stable coins MKR and loans LEND and COMPOUND remaining. For the exchange, the current UNI price has not yet reached a reasonable range. It needs to look at the next step of innovation. ZRX is more cost-effective and Gathering reasonable wealth has gradually cooled.
