DeFi’s narratives in 2021👇
Slowly chipping at TradFi credibility from synthetics to savings, injecting itself into legacy systems during moments of havoc (GME). Oasis for 24/7 price discovery in an era of dysfunctional markets. A refuge for savers in the yield-deprived sahara, without bankers & their fees.
Institutional products racing to capture inflows (Bitwise the early-mover, Grayscale the 800 pound behemoth). Wall Street rebels warm but unallocated, Wall Street dinosaurs in denial. As with BTC, they ultimately allocate by force, not by will -- client demand dictates all.
Market sleeping on Catalyst Spring from the macro (Optimism/Arbitrum/L2/EIP1559) to the idiosyncratic (BAL V2/UNI V3/ANCHOR). Magical confluence as technicals align with catalysts; range-bound, healthy BTC + uptrends abound when charting DeFi in BTC terms.
ETH monetary policy on brink of disinflation, tied directly to the fee boom caused by DeFi (EIP1559). Fee booms drives fee burns. Meanwhile ETH 2.0 creates a reflexive supply sink. Funny money distracted by copycat protocols, but will eventually rotate to quality.
Decentralized derivatives a necessity, baking in the background, but yet to make their impact (V**A). DeFi derivs to Bybit as the AMM was to Coinbase. A perp and options boom emboldens the sidelined market maker. CLOB Hedging unlocks next wave of available TVL.
Silicon Valley fastest to pull the trigger, seeing flashbacks of early FinTech; DeFi as PayPal/Stripe/Square. Social media giants are the new banks but can’t be trusted. DeFi as the Web's credibly neutral banking layer. VC enamoured with DeFi as w/ ICOs in 17, but more convicted.
On and on... Just imagine not being right here, right now. It's not that we are degenerates LPing for pools that can be rugged at any second, but that central banks have rugged the world's financial system and this is the market's only rational response.

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More from @ninos_mansor

9 Feb
Post-Musk crypto markets are going to be eclectic and confusing. Retail is now here to stay, so capital rotation becomes more idiosyncratic. $DOGE type moves that leave us totally bewildered. More chaos and randomness. Correlations fly around and confuse conditioned participants.
The entrance of Musk's retail is the return of a 2017-type market. It'll be way more fragmented vs 18/19/20. It's not a market where you can over-generalise through clear structural themes.

Alts blown off one second, pullback is over the next, lead by some random coin on WSB.
It's now a war between old retail and Musk retail. The psychology of Musk retail is very different. Musk's crowd is futuristic and open-minded. Anything is possible. Any valuation, any idea. Pure crypto retail is skeptical, wounded by bear market PTSD.
Read 8 tweets
3 Feb
The market is yet to understand Ethereum’s four-prong supply sink

Unlike the Halving, $ETH's supply-side argument is not straightforward to grasp

But once understood, just like the Halving, these dynamics will drive a quick institutional repricing 👇
1) Firstly, ETHE has re-opened for subscriptions as of early February. This is a check valve: coin that enters does not leave.

With a CME contract paving the way for institutions to arb the ETHE premium, this ultimately creates a black hole for spot $ETH.
2) While ETHE is an institutional supply sink, ETH 2.0 is a gravity well for diehard, ETH-denominated HODLERs.

Staking metrics are growing: According to @cryptoquant_com, the staking rate has grown by 250% since December and roughly 2.8m ETH ($4.3b) now sits in contract.
Read 7 tweets

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