Wednesday, September 22, 2021

Puff, puff, pump on 4/20! April 16-21st

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Loyal Finance Redefined readers:

Hello, I’m Andrew. My inestimable colleague Andrey, the earlier compiler of this article, is stepping away from Cointelegraph with a purpose to construct [REDACTED], leaving me to take over lettering the information. Whereas I’m thrilled he’ll be protecting across the DeFi ecosystem, I’m additionally infuriated that there’ll be one more gigabrain buying and selling towards me. 

Additionally: journalists quitting their jobs to do DeFi stuff. Discuss high alerts. Whereas DeFi tokens and ETH prices in particular have largely rebounded from dispepsia-inducing lows, I stay antsy.

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Nonetheless, the highlights of the week:

4/20 Haze It

Within the 4/21 hangover right this moment, a brand new crop of crypto buyers are discovering some merciless market realities. Hopefully, they’ll be taught to chuckle about them. 

Yesterday, the Dogecoin neighborhood cashed in on a few of their rising (if seemingly destined to be short-lived) cultural capital, making an attempt a hostile “unofficial vacation” takeover of 4/20 — a social media push to grab the date away from stoners and rebrand it as “Doge Day.”

To some extent, it labored: Elon Musk, the meme famous person who occurs to run just a few tech corporations, ratioed some disbelieving Boomers, and famous celeb intercourse tape participant Dave Portnoy himself bought a bag that prompty tanked in value. DeFi-ers shouldn’t care an excessive amount of concerning the meme forex aside from its utility in predicting wider altcoin runs, however Dogecoin day did characteristic just a few different pump-and-dump absurdities.

Self-styled DeFi tokens like $SAFEMOON and $SHIB hit the zenith of multiweek pumps on 4/20, together with tasks like $ASS following swimsuit. The moonshots led to some outstanding on-chain tales of guppies rising into whales basically in a single day on paltry preliminary investments: 

Then, because it all the time does, the opposite shoe dropped. On the time of writing, $SAFEMOON is down a whopping 41.95% on the day, $SHIB within the purple 38.48%, and $ASS seems to be like ass.

These pump-and-dumps stand out for 2 causes: how little effort went into them, and the way a lot curiosity they managed to draw anyway. SAFEMOON contains a token burn and redistribution on each sale; basic pumpanomics providing little by the use of novelty. SHIB’s utility continues to be within the formation levels, with a DEX and an “artist incubator” within the works (although they’re donating… one thing? Someway? To animal rescue organizations), and contains a companion coin, LEASH, a synthetic rebasing DOGE that no one needs or asked for. I don’t know what ASS does and refuse to seek out out. 

SAFEMOON particularly bears superficial similarities to the Invoice Drummond cash experiments like $XAMP and bonding curve ponzis like $TRIB that dominated late final 12 months. I keep in mind these for being enjoyable; everybody knew that it was musical chairs that you just performed with actual cash, however dived into video games with the zeal of kindergarteners anyway (XAMP’s case, the challenge emerged from a pseudonymous dev whose namesake is known for literally burning piles of cash — nobody was making an attempt to idiot anybody else about how issues would prove). It was a string of absurd schticks acted out in what usually appears like a essentially absurd house.

Safemoon, against this, has a slick advertising and marketing marketing campaign underway that seemingly consists of appreciable PR heft (as a journalist I really feel as if I can spot inorganic narratives; Google Safemoon’s information protection and inform me what you see). Likewise, the sums of cash made and misplaced within the bygone period of Drummond all of six months in the past are anodyne in comparison with the ocean of money that lifted these shittokens on 4/20. It’s nonetheless enjoyable and video games — all a giant joke, actually — however the buyers don’t appear to completely perceive that.

At my most idealistic, I consider the mass adoption of DeFi might be as useful to the development of the human species as mass literacy; on days like 4/20, nevertheless, I believe it’s an unusually environment friendly mechanism for parting fools from their cash.

From chapter 49 of Moby-Dick, “The Hyena”: 

“There are specific queer instances and events on this unusual blended affair we name life when a person takes this entire universe for an enormous sensible joke […] And as for small difficulties and worryings, prospects of sudden catastrophe, peril of life and limb; all these, and demise itself, appear to him solely sly, good-natured hits, and jolly punches within the facet bestowed by the unseen and unaccountable outdated joker.”

I’ve endured pump-and-dumps. I’ve realized that, like Ishmael’s god, the market usually acts as predator cackling because it tenderizes your ribs. The perfect — and perhaps solely — approach to stick round is to cackle proper again, smile on the sea of purple in your portfolio, and keep on. 

I’d prefer to welcome the brand new crop of buyers who’ve taken their first experience on the euthanasia rollercoaster. To you, my stimulus check-investing, Tik-Tokking buddies! You’ve been hazed, you bought by way of it, and I hope you grasp in there. Keep away from rebase video games and do not forget that boring outdated 10% APY stablecoin farming is all the time an choice.

DeFi is best when you may chuckle about it.

What’s happening with Aave?

Maybe the largest story of the week in some way went largely unnoticed: cash market and lending large Aave is contemplating a transfer into social media. 

The weird shift was first teased by Aave’s official Twitter account on Saturday:

I adopted up instantly with Aave co-founder Stani Kulechov to verify that the Tweet wasn’t the work of a ponderous intern celebrating 4/20 early. He gave me a brief assertion, one whose visionary heft raised extra questions than it answered: 

“At Aave we consider in a thesis that finally interactions in web3 realm will grow to be finance, whether or not its likes, sharing footage or moments, all the things will grow to be user-owned worth that may be empowered with Aave Protocol.” 

I’m reminded of that tortured plotline in The Workplace the place Dunder-Mifflin’s paper firm gross sales web site introduces social media options. How would it not work, what synergy if in any respect does it have with decentralized lending, and, actually, why? 

Aave’s head of integrations, Bily Zeller, gave some further background, implying that there could be a pay-per-post mannequin through which curiosity on deposits might be used to submit:

This doesn’t essentially translate to the “posts-as-value” mannequin that Stani laid out, nevertheless. In the meanwhile, I’m skeptical: if Stani ever responds to my DMs I’ll be interviewing him to get extra background. I sit up for being satisfied.

Pivots to completely new industries apart, the protocol is firing on all cylinders.

Yesterday, Stani teased a picture of the cash market with bolstered yields from Aave token distributions, a part of testing for a liquidity mining program at present dwell on the Kovan testnet:

Aave is already a core layer in lots of retail and protocol-level farming methods; including AAVE token rewards for lending and borrowing would supercharge TVL metrics. I’m considerably involved for token value (take a look at what governance token rewards did to CRV final 12 months), however suspect this system might bolster the ecosystem significantly. 

Brilliant, if generally puzzling days forward for the protocol.

Different huge headlines:

Pancakeswap on the rise

Uniswap v3 hits testnets

CRV’s rise could mean bumper crops for yield farmers