Who is mining for the DeFi “wave”? Cao Yin and 25 other trendsetters said this

The summer of 2020 belongs to DeFi. Compound kicked off this “big drama”, then Uniswap, YFI, YFII, etc. appeared one after another. Both new and old chives were “mining for gold” in this DeFi wave. What did you vote for? What are the investment considerations? Everyone has their own ideas. Bibi News had a great conversation with 25 “trendsetters” in the DeFi sector in the industry.

Cao Yin | Digital Renaissance Foundation Managing Director, Acala Network Advisor

Investment time: about 3 years

Investment projects: primary market Acala, Bifrost, Darwinia, Zenlink, Loopring; secondary market: the top 20 have investments.

The factors for investing in DeFi are mainly viewed from the perspective of value capture of the underlying protocol. Although many of these mines are very popular now, I'm actually skeptical about whether these mines can actually capture value. Other than Sushiswap, grab the value capture of Uniswap's underlying protocol. Most farmers are difficult to capture value. Of course, apart from those like YFI, they eat the sweetest bite, so this can also capture value, because once we take a bite, we eat it right away.

Acala is an underlying stablecoin that can directly capture all the value of future DeFi on Boca. Almost all of Boca's DeFi projects require cooperation with Acala, and they all need to use AUSD to obtain such an asset, just like MakerDAO.

DeFi trends: First, look for a new bottom layer, because Ethereum will become increasingly congested. And if you want to find a new bottom layer, Boca is definitely the most suitable bottom layer. In the future, a large number of DeFi will migrate to the new bottom layer, or develop it directly based on the Boca base layer and start development from scratch.

Second, the collective rise of Oriental DeFi, like YFiI, has spurred a number of Oriental DeFi.

Third, real assets are on-chain DeFi, such as unsecured credit and supply chain finance (gold, US Treasury bonds). These assets can all be used as a basic layer in DeFi in the future. This is something that Aave and Maker must do now.

Xu Chaoyi | Founder of BKFUND

Investment time: about 2 years

Investment projects: YFI, YFII, Based, YAM, Grap, Curve, Compound, Aave, Sun, etc.

There are three main points to consider in investment projects.

1. Does the product itself have an innovative design, because there are actually a bunch of imitations out there, which are basically simple copies of well-known projects, and some even deliberately add bugs or backdoors to the code in smart contracts. This kind of pure imitation suggests not to play with it; it's dangerous. However, if it is a reliable community-based team, which is disdainful of simple imitation, it will generally add some of its own innovations and characteristics in terms of products and economic models, and such a team will continue to iterate and improve the product.

2. Follow scientists and KOLs to invest in projects because they are generally careful and serious, and they try to choose reliable projects when investing in projects;

3. Looking at the ability of the community to operate, the operating ability of the community is strong enough, and the appeal is strong enough. It can stir up huge waves within the community, and it is relatively easy to succeed.

DeFi trends: DeFi liquidity mining, which is currently very popular, will eventually become an everyday decentralized wealth management product that is more popular and has a relatively reasonable yield, but is still higher than financial management in other industries. In addition to liquidity mining, oracles, unsecured loans, and even NFT splitting FTs will spawn some new ways to play. I think there will be plenty of opportunities to make money in the short term.

Peng Song | CZZ Technology Community Core Developer

Investment time: 2 years

Investment projects: YFI, YFII, CZZ, SUSHI, JFI, etc.

Investment considerations: Capital safety issues. Nowadays, most of them are doing liquidity mining. Many people rush into the capital without even reviewing the security of the contract. This poses a huge risk to the principal amount. Currently, DeFi is mainly divided into destructive mining and lossless mining. Lossy mainly refers to participating in DEX's capital pool and becoming an LP to pledge mining. Of course, it depends on what basis you are considering this. Lossless mining mainly refers to stablecoin mining. Generally, there is no loss of capital, and it also attracts large amounts of capital to mine.

DeFi trends: integration of DeFi underlying assets and construction of cross-chain infrastructure. Nowadays, the entry points for many DeFi projects are very mixed. In particular, there are many types of decentralized stablecoin mining. There are many types of decentralized stablecoins. Decentralized stablecoins require a decentralized stablecoin asset that can be integrated with decentralized stablecoins, and a good developer platform so that more DeFi products can be accessed.

Another is the construction of cross-chain infrastructure. Currently, more mainstream coins map ERC20 to issue a new coin and then participate in DeFi, but they are all lying there without actually becoming active on the chain. Therefore, there is a need for a project that can cross-chain mainstream assets. CZZ is doing this.

Li Xiangmin | Chain Capital Founding Partner

Investment time: about 3 years

Investment projects: MakerDAO, Bancor, Kyber, Aragon, Unifi Protocol, DeFiner, Alchemy Pay, Golff, Bella and more than a dozen other DeFi projects.

Investment considerations: project positioning, whether a business model has been established, technology development, team background, financial strength, and community building perspective.

One of the key factors for the assessment is the originality of the project. We chose to invest in leading projects in different fields; second, technical quality, with or without code audits, and security is the most important factor in attracting participation; third, whether the team has a combination of financial and technical background. This is related to DeFi decentralized finance. We don't think the project will last without a professional person or deep understanding of any aspect.

DeFi trends: From a security perspective, with the increase in hedging amounts, various code issues have arisen in recent days. First, the code review of the project will be strengthened, and second, follow-up insurance will become an immediate requirement, and insurance projects have certain opportunities.

From an asset perspective, currently it mainly circulates on ETH. Apart from TRX, other public chains are still relatively small, and EOS, ONT, NEO, and QTUM are all active. We think the public chain has assets with a complete ecosystem that is worth paying attention to.

Knight Zhang | Uncertain Thinking Editor-in-Chief

Investment time: 2 months

Investment projects: AMPL, YFI (mining), NXM, YAM (mining), SUSHI (mining), LEND, SNX, REN, BAL, etc.

Investment considerations:

1. Head category (LEND, SNX, NXM, BAL, CRV, REN, etc.)

This type of project mainly considers whether the business model of the project has logical support, whether there is real business data, including judging comprehensive data such as TVL, CAP, yield, PE, number of users holding coins, number of Twitter followers, etc., as well as the current roadmap, whether there are incentives and coin listing expectations, etc. The head category is the one that takes a heavy load and holds the target for a long time.

II. New model classes (YFI AMPL, etc.)

This type of project mainly takes into account the popularity of the community, whether the model has room for imagination, the composition and background of the team founders, future business prospects, and the divergence of opinions of actual participating users. The investment logic chooses to take light positions and observe.

3. Short-term mining (YAM, SUSHI, CREAM, etc.)

This type of project focuses on contract risk, team background, business model, and areas of innovation. For simulation, I generally explore and sell without predicting future analysis. For initial mining projects, the business model and market match will be taken into account, and the investment logic will choose to sell a portion of the mined tokens and hold a portion.

DeFi trends: At a microscopic level, the next focus of DeFi is to provide integrated transaction experience applications, including one-click execution of application types such as DEX, lending, mining, and derivatives.

At the macro level, DeFi is the ultimate development direction at this stage of blockchain applications, and there is a real need to connect with the real world. More than just an investment, using DeFi payment apps to deal with high inflation in some countries is a real application that has already occurred. The gradual stabilization of various types of lending and income applications will allow more capital to be invested in DeFi for financial management.

Uncle Shi | CoinCoin CMO

Investment time: about 2 years

Investment projects: WGRT, JST, NEST, DF, FOR, SRM, YFI, YAM, etc.

Investment considerations: The first consideration when investing in a DeFi project is definitely safety, whether the audit has passed, followed by project popularity and community discussions, and finally the size of the benefits.

DeFi trends: Currently, the effects of DeFi user growth and transaction volume growth are very obvious, and there are many ways to play in the DeFi field that have not been realized, so there is a lot of room for imagination. For investors who didn't participate in DeFi in the early stages, study fast and move on. If you learn Uniswap, learn about liquidity mining, and understand the mechanisms behind the DeFi ecosystem and governance coins, you can largely avoid stepping into pits. Learn more and step less into the hole. The principal amount is limited, but there are plenty of opportunities to make money.

Zhu Wenwu | Founder of BLOCKNEW

Blockchain entrepreneur (screen name: Exploring Cats)

Investment time: 2 years

Major investment projects: ANT, LINK, LEND.

There are 3 factors to consider when investing in DeFi projects. One is a security audit project, which is necessary. Second, for the project to be successful, innovation is needed, not imitation and copycat. The most critical and core thing is that DeFi projects themselves have “needs” and have application value. Only the usage value brought about by actual demand is the supporting essence of the financial value of all projects.

The most critical and core thing is that DeFi projects themselves have “needs” and have application value. Only the usage value brought about by actual demand is the supporting essence of the financial value of all projects. Otherwise, if you hold it for a longer time, it will reveal its original shape.

DeFi trends: DeFi is challenging the original blockchain world, including the industry's creativity, innovation, and products. More and more external capital is being attracted, and traditional centralized exchanges will also play a role in expanding the next wave of markets.

Essentially, whether it's a previous project or today's project, whether 100% or not, it is the value of the organization supporting the project. Is it possible to determine whether the project is good or bad, or whether it is capital.

Today's mining is actually an innovative investment. This kind of investment is very smart, the risk is very low, and the profit is very high. This kind of high profit comes from the historical process of transferring users from the old coin industry to users in the new currency industry through liquidity mining. This is a siphon effect brought about by the big era, and it is a period of transfer dividends between old and new.

Gavin | Founder of ChinaDeFi

Investment time: 1 year and a half.

Investment projects: established DeFi series, YFI, YFV, SUSHI.

Investment DeFi considerations: on-chain data, team capabilities.

DeFi development trends: The underlying improvements of Ethereum 2.0 and EIP1559 will free up DeFi innovation, and the trend of CeFi's transformation to DeFi will become more obvious; Ethereum's advantage is unshakable due to developer ecology and market factors; the governance circuit has not come to an end, and there will also be new projects, showing cross-chain and cross-project trends; the underlying support ecosystem projects can be laid out ahead of schedule.

Uncle Rogue | Blockchain Site Founder, Senior Blockchain Practitioner

Investment time: 2 years

DeFi considerations: Market capitalization, transaction volume, and on-chain activity three indicators.

DeFi development trends: The main idea of DeFi at this stage is to consider how to use decentralized means to achieve the existing capabilities of centralized finance. This will be a relatively long-term process. Currently, many services are still very rough and lacking in refinement.

By the end of this stage, it will be the second half of DeFi. The topic that DeFi needs to consider at this stage is how to use decentralized capabilities to provide financial services that go beyond traditional finance. This is already showing signs of this. Aave's unsecured loans are an example, but there is no scenario yet. I believe that with the maturity of the blockchain industry as a whole, the scenario problem will eventually be solved, and that is the real highlight of DeFi.

Hope | TokenPacket CEO

Investment time: 2 years

Investment projects: Some mining projects on Organix, DefiBox, DFS, SNX, SUSHI, and JustSwap, such as Pearl, and DeFi projects on Ethereum.

Factors to consider when investing in DeFi projects include comprehensive factors such as the overall design of the project, team background, project valuation, and market popularity.

DeFi trends: Currently, DeFi is probably still in its early stages; basically, it is exploding on Ethereum. DeFi will also explode on other public chains in the future, such as Wave Field and EOS.

Moreover, DeFi also has a big impact on traditional exchanges, and traditional centralized exchanges will also join the DeFi battle. In addition to exchanges, some large institutions and large capitals will also join the DeFi bandwagon.

Miao Kai | Lightnet CTO, founder of Quantiex

Investment time: about 2 years

Investment projects: MakerDAO, UMA, Compound, etc.

Investment considerations: users and liquidity (or capital accumulation). If you choose a field you are relatively familiar with, you can use the above two indicators to evaluate the overall value of the project; finally, check and convert the previous valuation twice based on the token economic model to select projects with relatively more investment value.

DeFi trends: Decentralized exchanges, especially AMM, will continue to be a very good direction in the future. More projects may introduce zero-knowledge proofs to improve off-chain processing capabilities. Finally, fields that are relatively close to cash flow will have greater opportunities, including stablecoins, lending, and the AMM mentioned earlier.

Takahara | NGD Marketing Director

As blockchain infrastructure matures, DeFi's highlights have also emerged:

1. Control your assets: The DeFi system has a non-custodial nature, high transparency, and low counterparty risk.

2. Decentralized unified liquidity supply: change the current fragmented centralized exchange pattern.

3. Organic composability: Different DeFi projects and components can be combined with each other to achieve more complex functions, thus providing an organic development path for a more powerful and complex ecosystem.

(Source: Neo Smart Economy)

Xu Kun |OKExChief Strategy Officer

We are in a very dynamic industry. Innovations are constantly emerging, and we must embrace change. To truly embrace change, we must not stop at discussions; we must personally participate; we can only raise our awareness through practice.

Compared to DeFi mining and 17year 1Co, the underlying logic is actually very similar. Private placement and public placement in '17 are just like current pledge mining. In the end, only a few high-quality projects can be launched on leading trading platforms to get fair pricing from the market. More than 90% of the projects ended hastily.

To participate in DeFi mining, the floating numbers on the book are just a process. You must have a clear strategy and be able to lock in the final profit. For projects that have basic value support and expectations, such as SushiSwap, its token is linked to fee revenue, so you can keep watching. However, most counterfeit projects are extremely risky. For example, Hotdog has been reduced to zero in just 1 day. Don't be blindly involved by FOMO emotions. If you participate, let alone simply pursue selling at a high point. It is important to withdraw promptly to ensure the safety of the principal.

As far as the overall DeFi ecosystem is concerned, liquidity mining makes the nesting of applications more complicated. Fluctuations in underlying assets will affect the robustness of the entire system and enhance risk management awareness and ability, which is an important issue faced by the entire industry for a long time.

Yang Tao | Co-founder of FinNexus

Investment time: 2 years

Investment projects: Currently, the focus is on the derivatives circuit, and decentralized options products are being launched.

Investment in DeFi considerations: whether there is real innovation and whether there is a product that has been implemented.

DeFi trends: The development of DeFi is the development of blockchain. DeFi is the blockchain itself, and the height of DeFi determines the lower limit of blockchain. Don't forget that Bitcoin was the first DeFi application.

Shawn | Weminer Mining Partner

Investment time: 3 years.

Investment projects: DefiBox, DeFis Network.

Investment DeFi considerations: Two factors to consider when investing in DeFi projects are security and user experience. Security is reflected in decentralized operation based on smart contracts, which are open and transparent, and can be checked in real time. The user experience is reflected in flexible debt position management, and users can better control risk.

DeFi trends: With the mission of improving the efficiency of global value circulation, DeFi will use the power of decentralization to combine the more transparent, fairer, and more convenient features of DeFi with the advantages of the blockchain system to provide a safe, professional, convenient and easy to use DeFi protocol for all users around the world. DeFi will promote large-scale adoption of blockchain technology.

Mountain River | Editor-in-Chief of DeFi Chinese Website

Investment time: 2 months.

Investment project: YFV.

Investment in DeFi considerations: Investing in DeFi projects is based on the strength of the team community, the sustainability and stability of the concept.

DeFi trends: As the industry heats up, the outlook is bright in the near future. But the currentEthereumNetwork pressure is high, and the number of active addresses and transactions is higher than the level of activity during the peak of 1CO, and the network hash rate is currently sluggish, far below the highest level in 2018. If DeFi is to reach its full potential, it must get rid of its dependency on Ethereum and expand its network a bit. What is certain now is that DeFi will truly meet the needs of the market, so it will conquer an important position in the cryptocurrency era.

Uncle Bird | Founder of DappBirds

Investment time: 3 years

Investment projects: Basically, all of the projects on the market are involved. The main ones are products on the Ethereum chain, especially products that have mining revenue tracking services.

Factors to consider when investing in DeFi projects: popularity, token design, governance mechanisms, circulation, and community consensus.

77 | DeFi Farmers Cooperative Official Account Author

Investment time: 3 months.

Investment projects: Foundation projects: ETH, TRX, Tarde. Mining projects: SUSHI, YAM, CRT, PEARL, etc.

Investment in DeFi considerations: token allocation (chips), whether the contract is audited (secure), the person (or community) who sells them, the team (but most are anonymous, and there are channels to get some information).

DeFi trends: Long-term optimism. There will be a wave of bubble washing in the short term, and people who buy coins at the second level will begin to pour into Tier 1 mining in large numbers.

Lu Bingquan | Co-founder of Tiger Charm (Note: Does not represent the exchange's position)

Investment time: 8 months

Investment projects: RING, SUSHI, YFI and YFII.

Investment in DeFi considerations: If you need to deposit coins for mining, it is recommended to choose code-safe ones. If it is a market purchase, it is recommended to choose a product that actually has immediate financial needs.

Zhao Yi | Chairman of the Whale Exchange

Investment time: about 2 years

Investment project: Cross-chain DeFi, eFu IFSWAP is a set of cross-chain DeFi protocols based on the Threshold Signature Scheme (TSS, Threshold Signature Scheme). It aims to solve the bottlenecks in Ethereum's development of DeFi and bring 1 million new users to global DeFi.

Investment DeFi considerations: We're always thinking about competition, collaboration, and value capture for DeFi protocols. Beyond the technology itself, we believe that the success of a DEFI agreement requires a strong sense of altruism.

DeFi Trends: Cross-Chain

Walking translation C | Financial blogger

Investment time: 2 months

Investment projects: DoDO, SUSHI

DeFi trends: DeFi is inevitable for blockchain to reach this stage. Next, various “liquidity mining” simulations, such as fraud, were reduced to zero. Funding is starting to pool on a few truly innovative, valuable DeFi projects. DeFi will still grow tenfold or hundredfold.

Ade | President of the Hunters Club

Investment time: 2 months.

Investment projects: Currently investing in sushi, corn, and ANK.

Investment in DeFi considerations: Look at the popularity of the market and the founding team.

DeFi trends: In the future, DeFi will definitely have many centralized exchanges entering the market; otherwise, users will boost the coin. Furthermore, the market will gradually be regulated, and the bubble will burst. Most mining platforms such as SWAP platforms (like pickles, diamonds) will go out of business.

Nan Bai Jun | Blockchain Self-Media Blogger

Investment time: 2 months

Investment projects: Mainly on Uniswap.

Investment in DeFi considerations: Currently, speculation is the main focus.

DeFi trends: I think it will cool down in the future, then some better projects will come out, and it may need a phenomenal product like Fomo3D to once again push the market to a new high point.

Coin Shengxin | Coin Fund Board of Directors

Investment time: more than 1 year. Investment projects: BRZX, AMPL, PLT, DIA, OM, BSB liquidity mining DEX, etc. Investment in DeFi considerations: Profit-seeking.

DeFi trends: Future trends in DeFi will have to wait until 2.0 is launched before they can continue to develop more healthily.

Sun Runchen | Owner of Chained Night Talk

Investment time: 1 year.

Investment projects: MKR, LEND, PIZZA, CRV, CVP, LRC, etc.

Investment in DeFi Considerations: Profit-seeking

Source: Bibi News