Thread by @TheAdrianVeidt

I'm v excited about an #DeFi: an open financial system w reasonable valuations, real users, real revenue, a simple & direct model for remunerating "shareholders" & lenders, & a clear mkt beyond speculators: those w non-traditional income sources.

#ETH $AAVE $UNI $COMP $YFI
1/6

#DeFi protocols generate real revenue & distribute it directly to hodlers via coin burns which I think of as "programmatic stock buybacks". They also have known market caps.

This allows valuation via P/S ratios

2/6

theblockcrypto.com/data/decentral…

Many #DeFi valuations are smaller than SaaS w higher growth rates.

Annualized revenue & P/S ratios:
- UNI: $1.14B, P/S ~6
- SUSHI: $550M, P/S ~3.5
- COMP: $400M, P/S ~4.3
- AAVE: ~$144M/y w P/S ~30
- MKR: ~$60M, P/S ~30
- SNX: $36M, P/S ~75

3/6

SaaS valuations for context: avg SaaS P/S ~40x, avg growth ~40% y/y. #DeFi growth rates > 1000% y/y.

IMO because #DeFi use is so nascent most are not aware of the ecosystem let alone how simple valuation techniques can be used

4/6

https://twitter.com/jaminball/status/1365414909379403780

@LynAldenContact has raised concerns that the #DeFi ecosystem is used to speculate on #DeFi & is rather circular

There is plenty of speculation (just like TradFi!) but #DeFi is v nascent & I expect more non-speculative activity over time

5/6

lynalden.com/ethereum-analy…

In contrast w @LynAldenContact's views I believe a #DeFi niche exists for those w non-traditional income sources (e.g. entrepreneurs/traders.)

I was v encouraged by this engineers use of #DeFi to be his own mortgage lender:
thedefiant.io/engineer-becom…

6/6

Just added to my $COMP & $UNI LT positions based on this analysis. I don't have massive positions in #DeFi alts vs. my core #Bitcoin, #Etherum, & equities but I'm v encouraged by the strong fundamentals & growth rates that eclipse even those of my beloved #MSOGang positions.