0xDeFi

Crypto | DeFi | BTC | ETH | Risk & Reward Ratio First | Opinions are my own.

[0xDeFi @Crypto928]

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[0xDeFi @Crypto928]

@iamswastik23 @Zebec_HQ Seems this zebec card needs top up fee of 1%. Lots of memecoins partnership....

[0xDeFi @Crypto928]

@ZeusNetworkHQ @toly @Rewkang @muneeb @Stacks LFG

[Duo Nine ⚡ YCC @duonine]

🚨 Why are crypto ponzis always related to new stablecoins? A long post.

▫️ Buy 1 ETH for $3,000
▫️ Stake ETH into stETH
▫️ Turn stETH into wstETH
▫️ Use wstETH to mint mkUSD
▫️ Use mkUSD to borrow more ETH
▫️ Stake ETH into stETH...

This is how you create magic money and turn 3k into 30k. You double, triple, quadruple count the same collateral aka leverage it.

DeFi's total market cap pumps dozens of billions overnight in a bull market and also crashes 90% in a bear market because of it.

It's all FAKE money.

You create more "money" from nothing and stablecoins are a key ingredient in that recipe. They allow you to leverage up, fast.

This is no different than fractional reserve banking where your $3,000 bank deposit turns into $29,999 new money created from thin air.

To achieve such a feat, it takes 100 cycles of deposits. See my picture.

Crypto never reaches 100 cycles, because the bubble bursts sooner rather than later.

Fiat "economists" even call this process a "business cycle". A more appropriate name is a bubble driven by ponzinomics and irresponsible money creation due to greed.

If you read crypto twitter, you will see people talk about liquid staked tokens (LST like stETH) and liquid re-staking tokens (LRTs like reETH) as the next best thing in crypto since sliced bread.

WRONG.

It's the next big bubble or ponzi. EigenLayer should not excite you, it should WORRY you!

If you seek an alternative view, then hit a follow @duonine to stay updated as this bubble develops.

Once you start seeing this "amazing" new LRT token being used to mint stablecoins on your X feed know that the bubble is about to reach its peak.

The higher the market cap of those new shinny stablecoins backed by LRTs tokens, the bigger the bubble.

Remember, $3,000 is the actual collateral for $30,000! That's a 10x leverage.

If ETH is 3k and it crashes by 10% or $300, the bubble deflates by 3k! That's 3k gone in your new shiny LRT stablecoin!

Such stablecoins will go to zero in the worst case scenario. This is how a liquidation cascade starts and panic begins.

Why does this concern me?

Because it will hurt native ETH holders that don't even stake their ETH. Picture this.

Let's say the LRT bubble grows to $50 billion. Actual backing? $5 billion in ETH or even less.

How exactly can $50 billion exit or sell at a profit using $5 billion of ETH collateral?

It can't.

What happens next is people get wiped out. LST and LRT tokens crash vs ETH's price by 10%, 50% or more. Any stables backed by LST/LRT tokens depeg and crash even more.

In the process, as $50 billion of fake money wants to exit, it will drag down ETH's price beyond a normal correction or crash. ETH is the liquidity of last resort for LST/LRT tokens.

Worse. It will drag down BTC's price as well. Because people will become DESPERATE to exit at ALL costs, even if they lose 50% of their money or more. BTC is the liquidity of last resort in crypto, just like the Fed for USD.

This is why bear markets are BRUTAL. They correct such imbalances. They are necessary and do well to punish such greed.

Don't believe me?

Have you heard of Blast L2? That's an ENTIRE network that will use LST tokens and stablecoins backed by LSTs to give its users "native yield".

Those users have no idea what's coming in the next two years and they deposited BILLIONS on Blast L2.

Projects always seek to create more yield to attract users, but that comes at the risk of an entire network like Blast going insolvent if they don't control their greed.

Do you trust them to put breaks on making free money?

In the last crypto cycle, Terra Luna UST imploded to 0 from $50 billion. It also used a stablecoin for their project. It double, triple, quadruple counted the same money while pretending it was real. Greed took over.

You need to EXIT early and well before that $5 billion in real collateral is gone. Cash out and don't ape back. That includes removing all assets from networks like Blast L2.

You are only safe on NATIVE chains like ETH or BTC.

This time, the bubble will use ETH LRTs and associated stablecoins. I'm concerned and few people will write about this because it puts a break on this bubble and greed.

I've seen too many crypto cycles repeat the same story. This is nothing new. At the end of the day, crypto is a free for all. There's no regulation, but at least we can educate.

Why risk your ETH for 3-6% yield when ETH will 2-5X this cycle?

Funny enough, this LST/LRT bubble will also be the reason ETH will pump hard because all those tokens will LOCK-UP ETH as collateral in a huge pyramid.

When Vitalik decided to take Ethereum from Proof of Work to Proof of Stake he enabled and allowed the creation of such ponzimonic mechanisms.

For this reason alone, Bitcoin is superior.

Don't be fooled by this market and don't let greed take over. It ends badly.

Hit a like and retweet this message to wake up more people and don't forget to follow me @duonine

P.S. I respect anyone building in this space and any examples or tokens mentioned above are used for illustration purposes only. What will eventually happen, we will all find out, but let's call it as it is.

[0xDeFi @Crypto928]

TVL
Solana: 409M
Avalanche: 542M

FDV
Solana: 21B
Avalanche: 4.8B

No interest to buy $AVAX, not to mention $SOL

$BTC is the one and only one.

[Edgy - The DeFi Edge 🗡️ @thedefiedge]

It’s my 3-year DeFi anniversary.

Here are 31 pieces of wisdom I wish I could send back in time to myself:

1. Taking profits and putting them into riskier bets isn’t taking profits - that’s just gambling. Lock your profits into BTC, ETH, stablecoins, and fiat.

2. Projects with cults can be extremely profitable. Just get off the rocket ship before it inevitably crashes.

3. Locking tokens for additional yield isn’t worth it. Nothing worse than being tied down to a sinking sink.

4. Protect your attention at all costs. You already have limited time and energy, don’t waste it keeping up with the latest Crypto drama.

5. Be careful overoptimizing yields - there’s no such thing as a free lunch. You stake the coin, earn yield, and then auto-compound those yields. Every additional yield comes with more risks.

6. Be skeptical of every piece of advice you see on CT - everyone has an agenda. Are they shilling a project to pump their bags? Are they spreading misinformation to game the Twitter algorithm?

7. When there’s a new narrative, be biased towards the market leaders. They have the 1st mover advantage and mindshare. The best beta plays are the forks on hot, new chains.

8. Being obsessed with the latest tools is a form of procrastination. You don’t need to use 50+ tools to make it. The biggest guys are simply using Etherscan, Debank, DeFiLlama, etc.

“I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.” - Bruce Lee

9. There’s an information food chain. Builders > VC / Insiders > Whales > bots > manual traders who receive news early (<1 min) > manual traders who receive news late (> 1 min). By the time everyone’s shilling it on Twitter, it’s too late.

10. Alpha boils down to 2 things: having access to inside information or being able to do the hard work that others are too lazy for. People underestimate how far you can go by simply keeping up with a protocol’s medium articles and their discord.

11. Everything repeats itself, just repackaged slightly differently. Improving at DeFi is all about pattern recognition. For example, if certain influencers start discussing projects, they’re trying to attract exit liquidity.

12. Position yourself early and let the gains come to you. Anytime you feel FOMO is a sign that you might be too late.

13. Viewing your gains and losses as portfolio % rather than $ will help keep you rational. It’s hard to remain clear-minded if you equate your trades with IRL purchases.

14. Cut your losers aggressively. Set a stop loss and know when to exit a trade before investing. Don’t let small losers turn into big ones because of the sunk cost fallacy or emotional bias.

15. Record everything. Write down what happened daily in Crypto, your trades, mistakes, and lessons. This is how you improve your mental algorithm.

16. Don’t overrate fundamentals in a bull market. All logic disappears, and people buy based on hype, emotion, and speculation. See the industry as it is, not how you think it should be.

17. Incentives can drive prices. People buy when there are expectations of future profits. This can be affected through airdrop speculation, locking tokens for additional rewards, ecosystem incentives, etc.

18. Don’t put anyone on a pedestal. All the “smartest guys in the room” like Alameda and 3AC got rekt’ed. No one’s too big to fail.
Protect your funds when there are insolvency rumors. If you’re right, you saved a ton of money. If you’re wrong, you were inconvenienced for a few minutes.

19. It’s not about being right or wrong. No one bats 100%. It’s about maximizing the upside when you’re right and limiting your losses when you’re wrong.

20. Narrowing your focus is an underrated edge. No one can keep up with the entire space. Pick a few sectors and stay on top of them.

21. Keeping up with Macro is overrated. Just monitor capital flowing into the markets to see when we’re back. Your time is far better spent elsewhere.

“The track record of economists in predicting events is monstrously bad. It is beyond simplification; it is like medieval medicine.” - Nassim Nicholas Taleb

22. Don’t touch crypto if you’re on tilt, drunk, or sleep-deprived. A single mistake can erase years of hard work.

23. Stablecoins aren’t as stable as you think. UST collapsed, and USDC had the de-peg scare. Storing your dry powder as fiat in a TradFi bank is entirely viable.

24. Concentrate your portfolio if you want to grow it - Diversify if you want to keep it.

25. Develop systems - these rules and frameworks will prevent emotions from killing your games. These can include how you take profits and when to invest.

26. Thinking you can 100x your portfolio through trading is unrealistic. It’s not 2016 anymore. 99% of people are better off trying to find ways to increase their cash flow and putting more goals in the fire.

27. The crowd prefers new projects and narratives - not your 2021 bags. Don’t fight human nature.

28. Be skeptical of every piece of advice you see on CT - everyone has an agenda. Are they shilling a project to pump their bags? Are they spreading misinformation to game the Twitter algorithm?

Look out for yourself.

29. Stop limiting yourself to Crypto content. You’ll learn much more from studying game theory, behavioral economics, and psychology than reading the 9th article on EigenLayer.

30. The best projects have elements of both fundamentals and pumpmentals. Pumpmentals capture the attention, while fundamentals give people a reason to keep holding.

31. The unknowns, unknowns are deadly. The founder gambles with the treasury, or the anon founder has a shady past. You can't predict them. This is where profit-taking, bet sizing, and portfolio management are your most critical defenses.

There are plenty more lessons to share, but we’re reaching everyone’s attention span limit.

Remember, there are exceptions to every rule. These are some of the principles I’ve learned, and some of them may change as I learn more.

The markets are choppy. It’s easy to feel down about DeFi, considering all the disasters in the past two years.

I still have the highest conviction in DeFi - I’ve staked the next decade of my life on it. Why? I see its potential. Efficiency. Transparency. It enables a new world where we have more control over our hard-earned money.

If you’ve learned something from this, then:

1. Repost and engage with this tweet if you think it’ll benefit your audience.

2. Make sure you bookmark this thread so you can re-visit it later during the bull run.

[0xDeFi @Crypto928]

@Benjamin918_ Is there a dashboard that can track how much $MAI been minted on Fantom / bridged to Fantom? Or cut the question short is, how much (in %) impact (collateral value) to the $MAI due to the Multichain issue?

[0xDeFi @Crypto928]

@thedefivillain Probably the collateral in Fantom is no value due to the bridge exploit?

[0xDeFi @Crypto928]

@thedefivillain Time is now $0.93 though a bit worry....theoritically yes its over-collateralized

[0xDeFi @Crypto928]

What's the point for PFP NFT? What value does it bring to you?
I admit price speculation is kind of a value that it brings, and probably the only one.

It's an ultimate PVP game and the pretty sure winners will be the insiders.

HODL BTC ETH

[0xDeFi @Crypto928]

@Rewkang @RDNTCapital Will you zap into dLP with your RDNT? (that appeared in one of your wallets)

[0xDeFi @Crypto928]

$OP MC now $697M
FDV $4645M
~15%

$ARB MC now 1264M
FDV $9913M
~13%

Imagine the pressure when more unlocked to the market.

[0xDeFi @Crypto928]

What's the point taking care whether it's a security or not?

Even if BTC / ETH is defined as security, will you stop accumulating ?

LFG!

[0xDeFi @Crypto928]

With such tx speed, dose Starknet really a usable network?

[0xDeFi @Crypto928]

What's the point for interacting L2 like zkEVM when the gas fee is around $6-7 per tx?

[0xDeFi @Crypto928]

With the current high gwei fee, it's totally not cheap at all even using L2 like OP or Arbitrum, that makes other chains like BSC and Polygon retail friendly (in terms of gas fee).

Love Matic specifically.

[DMH 🦇🔊🌊 @DeFi_Made_Here]

The second biggest @Uniswap #Arbitrum pool is a scam.

The scammer sent 400 $ETH to make it look legitimate. Do not interact with it!

I am scared to imagine how many people will lose money here.

Please RT!

The original contract is: 0x912CE59144191C1204E64559FE8253a0e49E6548

[0xDeFi @Crypto928]

Ponzi Terra Luna UST still at $0.02 today.

TradFi Credit Suisse AT1 Bond went $0.

Interesting.

[0xDeFi @Crypto928]

What if Fed rate increase by 50bps and bank liquidity issue be funded with current measures?

[0xDeFi @Crypto928]

@AlvinWu_TW 當時S&amp;P500 / BTC就展開了史詩式升浪，
$TLT 卻下行，但當時Fed Rate是新低。

今天高息情況下，究竟如何，真的有夠亂。