The likes of GMX are seeing huge gains even in these bear market times, with GMX very close to its all-time high achieved in January 2022.
The question now becomes, is this narrative sticky and sustainable, or is it another Olympus DAO style Ponzi which will sweep and up rek retail traders?
The answer is simple. It’s very early, but it’s definitely sticky.
We are seeing elements of Ponzinomics in the protocols at the moment, alongside a host of drawbacks (due to its early stage) but as a narrative, ‘real yields’ is simply repackaged derivatives!
We covered derivatives in a report series early this year, and have completed a whole host of deep dives on the leading protocols in the space (including GMX).
‘Real yields’ refers to the revenues that these DeFi derivatives protocols earn, which are distributed to token holders and liquidity providers. This is a sustainable form of yield, unlike the previous money printing we have seen from protocols trying to bootstrap their ecosystems, relying on methods that destine their token to failure.
It’s worth noting that at this stage, there are many potential issues to overcome, not least in the macro picture! We don’t consider now to be the optimal time to get involved in the protocols.
However, we identified this opportunity early on and will keep our finger on its pulse, identifying opportunities as and when they arise.
For our derivatives series, see a handy breakdown in DeFi Derivatives So Far, and access all the articles.If our approach doesn’t outperform the overall crypto market during your subscription, we’ll give you a full refund of your membership. No questions asked. For quarterly and monthly subscribers this is applicable once your subscription runs for 6 consecutive months.
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