However, despite immense strides being taken by AMM's like @Uniswap, @SushiSwap, and @CurveFinance the majority of SPOT volume is still done on Centralised venues
(16.72% on DEX vs. CEX)
And despite all the success of @GMX_IO , @dYdX and @GainsNetwork_io , almost all the FUTURES volume is done on centralized venues.
that's <2% of the overall futures volume being done on decentralized exchanges.
also within CEX-land, Binance is hoovering up the volume in the fallout from FTX, that's not good from a competition perspective..
So, the question remains, how do we create a paradigm shift in transitioning CEX volume to being on-chain?
well, the guys at $DEUS (v3) are convinced that the key to this success will be to work directly with brokers and build scalable p2p architecture
See the current model of @GMX_IO is such that a liquidity provider puts ETH, BTC, or a stablecoin into a smart contract and then traders borrows from that pool to access leveraged trading with the benefit of of oracle pricing (zero slippage).
but this raises issues for liquidity providers, especially in highly volatile markets. It also opens @GMX_IO and other forks open for price manipulation which means that the short-term fix is to limit open interest and thus scalability..
$DEUS invites anyone to build upon their infrastructure to facilitate bilateral OTC trades between a user and a counterparty. This is EXACTLY how TradFi markets can scale - the risk is isolated per transaction and risk can be optimised or transferred.
The first guys building the front-end for this RFQ style model is @dsynths , which will be deployed on #Arbitrum. Hanging out in the discord it's clear that testnet is likely live v. soon
but see that long YouTube video above, that's where the real alpha drops are:
1hr:28min in : "That counterparty, that broker ... they want to do a whitelabel with their name on it"
"they will disclose themselves...wait until that happens"
in Q&A the following were addressed:
i.e. they already have a network of brokers who can provide real liquidity on over 4000 assets across equities, fx, precious metals, crypto etc. The market makers in question love the idea that spreads are MUCH THICKER than in TradFi
I've spoken to the team about $DEUS utility and it's something they have fully covered in anticipation of the Arbitrum launch. Also note the low max supply.
as a Founder myself, I have huge respect for teams that work through a crisis and come back stronger. Yes, these guys had issues with their $DEI stablecoin, and they have gone back to the drawing board to allow trading with USDC as collateral (on Arbitrum). Pivot or Persevere.
it'll be a long climb back to their previous high this year of above $1000, but at $110 or so, and a MC of $14mm I see room for upside when looking at the likes of $SNX. They deeply understand the ISDA based OTC markets and the team has TradFi experts and some great engineers.
here are some screenshots from our internal chat, we've been buying in $10k clips and will continue to do so. Yes it's on Fantom, but liquidity is also likely to migrate over time.
The narrative of on-chain trading volumes will only heat up in the coming years. Clearly the trend is up, with the token up $35 pre-FTX / now over $100 post FTX. I see them winning volume on other asset classes include commodities and FX as crypto dries up a bit.
> leaves high-paying job as an interest rate trader, consistently writes weekly rates roundups and has a powerful vision to usher in the next wave of use cases for fixed-rate DeFi
See, most of the large (DeFi) DAOs have their total treasury value in their native token. They can't really sell it (perhaps OTC), but they do need to a) diversify their treasury and b) raise cash for operational purposes.
I know @debtdao are building some interesting stuff in this space, i.e. a debt marketplace for DAOs, complete with automated verification of project cash-flows to help identify credit worthiness/set out loan terms.
TVL down, yields evaporating, depeg risk, protocol hacks, grave dancing on UST, and a terrible macro outlook.
A DeFi investor perspective.. š§µ
Total Valued Locked (TVL) has dropped from over $240bn into January to around $110bn today (-55%).
In parallel, there has been a flight to safety towards USDC and DAI, where supply-side yields have collapsed to sub 2%. i.e. when yield is not paid in some BS farming token.
The end of my first week back after a much needed vacation.
Great to be back in flow with my farming team @_iammarkc and @juanbugeth and equally as much joy in connecting with various players in the DeFi space.
3 highlights from this week.. š§µ
1. @Instadapp where I can create #DeFi strategies such as collateral swaps, one-click deposit and borrow, and debt swaps all in one simple transaction.
2. @indexcoop who we are working with to build systematic arbitrage opportunities in index format, such as extracting the sustainable yield from ETH funding markets. This excites me as in TradFi I built and traded systematic investment strategies for large insitutions.
They help you understand positioning in the leveraged markets. Funding rates below 0.01% are bullish (green). Funding rates above 0.01% are bearish (red)
2. Aggregrated indicators for Open Interest (OI) and Cumulative Delta Volume (CDV). It helps understand the volume and direction of futures and options markets. coinalyze.net/ethereum/open-ā¦
3. Orderbook heatmaps using tradinglite.com . Helps visualise where limit buys and sells are placed across the major spot and future exchanges. Also helps to identify levels of support and resistance. Sometimes you can see spoofing in real time!