Every BULLRUN needs a token narrative to help get the rocket boosters ignited.
New technology, new token models…the markets need something to get excited about or a BULLRUN
won’t happen.
So what is going to be the next BIG crypto narrative to help push the markets off of
these lows!?
Well find out in about 10 minutes, because it’s time for Chico Crypto!!
Sooo if we go back in the history of cryptocurrency…every BULLRUN had some technological achievement
or narrative that helped move the markets forward.
The creation of Bitcoin in 2009 was the first one.
BTCs new idea of decentralized money helped move the markets forward, creating BULLRUN’s
in 2011 and into early 2013.
But throughout 2013, the technology started advancing and advancing quickly…by Mid 2013
Altcoins were starting to be created…Using wayback machine to check out Coinmarketcap
from May of 2013, we can see there were 13 other crypto’s besides Bitcoin…and by
the end of 2013, we can see that list grew to a total of 41 coins.
The introduction of altcoins helped create the bullrun that happened at the end of 2013..
The 2017 BULLrun was kicked off by the introduction of the erc20 token built on Ethereum..before
this, it was much more complicated to create a token…you had to fork Bitcoin or create
your own consensus mechanism, and if you forked BTC, you needed to find hashpower.
Erc20 let anyone with minimal technical skills create a token, which led to an explosion
in tokens and thus crypto market cap..checking out coinmarketcap at the end of 2017, we can
see there were now over 1500 crypto tokens out there…
So what were the next hype cycles after this?
Well I actually called this before it happened..in December of 2019, I made this video…DeFi,
Decentralized Finance will lead the Bullrun charge & shortly after, January of 2020 I
made this video, Ethereum DeFi Tool to Spark the Next BullRun?
Uniswap…and as we know, we had the DeFi summer of 2020, pushing the markets back past
20k by the end of the year.
And then finally we had NFTs, Alternative Layer 1’s, and Metaverse which helped finish
off this last bullrun we experienced…but the hype of all of these has faded…and the
markets have crashed again…
Sooo what is going to be next?
What will be the crypto narrative which will get the markets out of these low lows!?
Well I have a feeling, it has to do with DeFi once again…but DeFi in a much more sustainable
and “REAL” way…I’m talking about real yield DeFi projects.
DeFi got crazy this last bullrun, with projects coming out left and right who promised outrageous
APYs…yield that was unsustainable, usually through token inflation which ended up obliterating
the tokens price…only serving to dilute its value..
But over the past 9 months, we have been seeing a new trend hit the DeFi scenes called real
yield.
You can think of 'Real Yield' as a revenue sharing token model.
Protocols with real yield share the protocol revenue with the token holders in the form
of their token, stablecoins, or the layer 1 protocol token they are using like paying
out in Ethereum.
And Real Yield projects are defying this “BEAR MARKET”...one of the first real yield projects
to hit the scene was GMX…GMX came out in October of last year, it hit a peak of 58
dollars by January of this year…and as we can see today, GMX is pushing back up towards
50…GMX is already almost back to it’s all time high, while a majority of altcoins
are down 70 percent or more!!
So how does GMX work?
What’s the reason for this?
Well GMX is a decentralized perpetual exchange, where you can go long or short on various
crypto assets with up to 30x leverage built on multiple chains, so far Ethereum Layer
2 Arbitrum and Avalanche..
Now the revenue and fees made from trading on GMX are stacking up and stacking up big
time.
GMX has moved into the number 4 position on crypto fees, averaging over 401 thousand dollars
per day for the last 7 days…pushing it above the DeFi gem Uniswap.
Checking out the GMX twitter’s last post, over 2.8 million dollars was collected in
revenue for the past week…and 100 percent of that revenue get’s distributed to token
holders.
Looking at this graphic on how GMX revenue and tokenomics work, we can see GMX token
stakers earn 30 percent of the revenue and protocol emissions, while GLP holders, the
protocols liquidity token, earn 70 percent of the revenue and protocol emissions.
GMX is a platform for the people…which is even seen in their token distribution, as
we can see only 250 thousand, out 13.25 million tokens of GMX are reserved for the team and
contributors..aka less than 2 percent of the token supply…
GMX started the Real Yield trend…and now there are other projects implementing this
revenue strategy…and this will be my first time covering these new “Real Yield” DeFi
projects.
The next real yield protocol we have to cover is GAINs network, as it’s one of the most
feared GMX competitors to hit the market.
Gains Network is developing gTrade, a decentralized perpetual exchange built on Polygon…
Gains Network has developed gTrade, a decentralized perpetual exchange built on Polygon.
Compared with its competitor GMX, this platform has one distinct advantage…the leverage
is synthetic, meaning the protocol can have any trading pair listed as long as there's
an oracle that tracks the price of the pair assets, which means many more assets can be
traded on Gains, even stonks and forex.
GMX is introducing synthetic leverage as well soon…but for now…Gains has this advantage
Gains is similar to GMX, but has a distinct difference…the trades and collateral of
the system are backed by a DAI vault which means the protocol revenue is paid out in
DAI.
Now checking out their July revenue distribution sheet, we can see Revenue is split between
many more entities than GMX…19 percent is distributed to NFT Bots, 15 percent is given
to the governance fund, 23 percent goes to the GNS/DAI LPs, 15 percent goes to the development
fund, and 23 percent goes to the DAI stakers.
…so 30 percent of the fees are going to governance and development treasury, while
70 percent of fees are going to stakers and LPs.
Now Gains compared with GMX has a lot of room to grow, GMX is rank #115 on Coingecko with
a market cap of over 369 million.
Gains is rank #409, with a market cap of under 50 million!!
And the final real yield project I would like to cover is Umami Finance as they have really
leaned into the RealYield narrative.
Initially, Umami was an OHM fork that offered huge unsustainable rewards for staking $UMAMI
but a few months ago, the community agreed through a governance vote a few months ago
to stop the $UMAMI emissions and pivot to a platform providing real yield…
As we can see from their app, they have 2 popular products..Marniate and compound, which
is paid out in wrapped Ethereum rewards.
And they even have a USDC vault coming soon, which will provide sustainable 20 percent
APY on your USDC…and the thing I love about this?
They utilize GMX.
From the description of this vault “The Umami USDC Vault generates yield by providing
liquidity to GMX's leveraged perpetual exchange and safeguards against market volatility using
non-liquidatable hedges from Tracer.”
So how much of the platform’s revenue is distributed to users?
Well checking out their docs we can see they say “Currently, Umami uses approximately
1/2 of the monthly yield from its PoL to pay out $ETH passive-income to its $UMAMI Marinators.
As protocol revenue from products such as Umami's USDC Vault continue to increase, Umami
will transition to paying it's Marinators from product fees.”
Soo out of these 3 real yield projects, GMX lead the pack paying out 100 percent to users,
next is Gains paying out 70 percent, and finally Umami pays out 50 percent.
There are other real yield projects out there, like the big dog Synethtix who pays out 100
percent of fees to SNX stakers, there’s Redacted Cartel, Looks Rare, Perpetual Protocol,
dYdX, Kujira on Cosmos, and I’m sure as time goes on and this narrative picks up steam…there
will be many others & you know your boi Chico will be the first to spot them…Cheers viewers
I’ll see you next time!