DeFi 2.0. It’s thrown around a lot and when it is, it tends to get people pretty excited. Who knows what it actually means? Or, how will it directly impact you?
These are the questions that we will answer today, in Part 1 of our DeFi series.
👋 Top Crypto Headlines
🚀 DeFi 2.0: Part 1 of Our Series
🏈 Fan Tokens: What’s the Fuss?
🧩 Latest Hack Puzzle
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Our Market Meditations are longer format educational segments. Each letter features a Market Meditation which will deep dive and analyse a relevant crypto event, theme or tool.
☄️ Welcome, to DeFi Reborn
Messari’s recent Crypto 2022 Thesis Report included an insightful section addressing Decentralized Finance (DeFi). We’ve summarised the high points for you, to access the full report, please click here.
Stablecoins bridge us from the old world to the new. A popular example of a stablecoin is USDT (Tether).
Tether has been plagued by claims of fraudulent activity.
This controversy has afforded opportunity to other stablecoins to grow.
Notably DAI and Terra’s UST, the latter of which is the fastest growing decentralized stablecoin of 2021.
UST has been the beneficiary of multiple developments in 2021 such as Terra’s Columbus 5 upgrade.
In addition, the cross-blockchain bridge, Wormhole V2, launched support for Terra, bringing the stablecoin to Ethereum and Solana.
✅ HOT CRYPTO 1: Look out for developments in Terra in 2022.
Looking to 2022, algorithmic stablecoins also appear to be making a comeback as are ones not pegged to the U.S. Dollar.
A currency controlled by the Fed and Treasury does somewhat limit the ability of crypto to revolutionise the monetary system. The leader of the movement to disrupt the status quo is Olympus DAO.
According to Messari: “Olympus DAO may be the year’s most important new project, and non-pegged stablecoins may be the best bet this industry has when it comes to depegging from the US dollar.”
✅ HOT CRYPTO 2: Familiarise yourself with DAOs, starting with Olympus.
Moving on to the final DeFi trend of 2022, Decentralized Exchanges (DEX).
Many Ethereum DEX’s exist, but some analysts think Uniswap v3 could give existing DEX’s a run for their money.
V3 has a lot of attractive features. For instance, it introduces customizable trading fees (30bps, 10bps, 5bps, 1bps) that incentivise liquidity providers to make new markets on otherwise illiquid pairs.
✅ HOT CRYPTO 3: Deep dive into Uniswap v3 and its features.
Part 2 of our DeFi series on Thursday will discuss a few specific DeFi projects and tokens that we are excited about.
To receive Part 2, make sure you’re a FREE member of the Market Meditations community, sign up link ➡️ here.
🖖Live Long, Don’t Prosper
Play-to-earn NFT platform Vulcan Forged has recently refunded investors the day after the platform was hacked.
But how much did they have to return?
🎾 All Fan and Games
Social media has allowed fandoms to thrive, with celebrities and communities giving direct access to fans without the middlemen. But most of that access has been one-directional.
What if the fan experience could include rewards, experiences and ultimately influence?
Well football clubs and musicians are taking note:
Clubs including Barcelona and Manchester City have issued fan tokens via platforms such as Socios and Binance.
Fans have spent hundreds of millions on the tokens to get perks, such as merchandise discounts, access to games and potentially meet and greets – although this differs per club and is still a work in progress.
Speculators have caused price volatility on these young tokens and many have lost value since their launch. That said, its overall market cap is up 50% since June.
Musicians on the other hand have been operating more in the NFT space, with the intention of rectifying an unfair revenue split as well as getting closer to fans.
Streaming services like Spotify take a hefty cut of the revenue and the ‘discovery’ feature tends to benefit already established artists over lesser-known ones, leading to unequal revenue distribution.
Through crypto crowd-funding, however, artists are able to raise money for their own albums, keep more royalties and even share sales revenue with the fans.
The fan token narrative has plenty of space to grow, but beware that unknown token release schedules and unscrupulous cash grabs make it a place to tread carefully in.
3. $140 million
This morning Vulcan Forge gas reportedly returned $140 million to all investors after it was hacked.
Based on the Polygon network the platform offers a large selection of products including an NFT marketplace, decentralised exchange and six games.
The refunds were made in PYR and LAVA tokens from the treasury Vulcan Forged used to save money for crises such as these.
Hackers stole 4.5 million PYR by accessing 96 private keys from some of the biggest users. At the time this was worth the $140 million mentioned above.
Shortly after the hack the price of PYR fell to $21 dropping 34%
To keep your crypto secure check out our Crypto Security Guide for tips on how to keep your capital safe.
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