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Hot Wheels Community (ID: FHBT18)Hot Wheels Community (ID: FHBT18)
, Author: Pepe, reproduced by Odaily with authorization.
Hello everyone, I’m Pepe. How popular is defi now? If you picked up a defi concept coin 7 days ago, it doesn’t matter what you get today, there is a 95% probability that you will be profitable, and there is a half probability that you will get more than 50% of the proceeds.Even those in the currency circle atmosphere group like me have recently doubled a certain small coin that they have taken before, including recently everyone is calling for a breakthrough in ether, and today I really saw a new high. A bull market always makes people feel smart, doesn’t it? Less, I can see everything more clearly, what leading times can be analyzed clearly, but I have been wondering whether some of this is just a trend, what do you think?
Today I’m going to talk about a slightly lower-key Dex project—Balancer. In fact, it used to be the leader of Dex. Three leaders for the decentralized exchange:But looking at the current data on defipulse, this position has been replaced by sushi. It seems that it is difficult to see bal in the leading paragraphs of cx in various communities:(Insert, before, people always ask where to find projects. In fact, this defipulse.com can be browsed frequently. It is ranked according to the lock position, and you can see the real status of these projects more clearly.)The reason why Balancer became popular between July and August last year was mainly because it just adapted to the trend and started liquidity mining at that time. After checking the previous records of Blue Fox, the number of its users has soared to 20,000 in August 2020. :At that time, Uniswap was just a gathering place for looking for small coins (called gems overseas) that are ten times the treasure of Internet celebrities, and there were voices in the market that Balancer was regarded as one of Uniswap's biggest competitors.
Regarding the Balancer platform, I don’t know how many people still know about it. In fact, it is very simple. It is the same as uniswap in mobile market making + swap trading. The biggest feature of his family is:
The currency and ratio of the liquidity pool can be customized
For each trading pair on uni, we can only say that there are two currency exchanges, such as eth/usdt, and must provide market making at a ratio of 1:1. To make a market for the trading pair eth/usdt, it can only be equivalent to pair deposit.When assets 1 and 2 are allocated at a ratio of 1:1, when the price of asset 1 fluctuates by 20%, the loss of impermanence is 0.4141%, but if we reduce the proportion of assets whose price fluctuates to 20%, the loss of impermanence can be reduced to 0.2753%:
The other is to set up a pool of multiple trading pairs. His family can set up to eight trading pairs together. There is an example on his official website:
Traders in such a pool can exchange at will. For market makers, the potential benefit is that multiple trading pairs can disperse the loss caused by price fluctuations of a single currency, and it is also placed in it like an index for market making.Under the premise of bearing the risk of price fluctuations, market makers can not only get a share of handling fees, but also get a part of BAL token rewards every week. A query website with clearer data is:
(If the picture is not clear, copy the link above to view)The red box above is the annualized return of market making, which has also been improved due to the recent rise in currency prices. The lock-up data is also increasing, but this rate of return can only be said to be good for the time being.At present, the main trading volume and liquidity of the platform are also concentrated in the top three wbtc/weth, bal/weth, and dai/weth. The other daily trading volumes are relatively small, and there are 2000-3000 addresses by market makers.Because you can set up market-making pools of various proportions without permission, there are quite a lot of miscellaneous trading pairs on the platform.It's just that there are not many transactions, and it may not be an exaggeration to say that it is a second-tier dex.Balancer should be regarded as a pretty good protocol, with its own characteristics, differentiated, and solved some problems, but maybe the problems it solves are not the most urgently needed, or can produce alternatives, such as impermanent loss and do-it-yourself As long as there is a large enough profit margin, no one will pay special attention to this, so it is difficult to form their own advantages and network effects.So I guess in dex, his family may be in a second-tier position for a long time, and it is difficult to surpass.However, if you look at this project alone, it is not bad. The new version will be updated in March, and some model optimization will be done to save gas costs. For details, please see:
In terms of price, affected by the recent defi boom, its performance has doubled in the past month. It is currently in an upward trend, and it may still go up for a while. After all, it has not reached the height of August last year, and uni/sushi are all new highs. Afterwards, it doubled again. In addition, it seems that the market also has a tendency to expand from this kind of leader who has risen a lot to the next level.
epilogue
However, we still need to pay attention to the risks. The current overall market value of defi coins has gone up in a straight line, and most coins are doubling in various ways in the short term:I don’t know if there will be a collapse like in early September last year. If some of your positions are more looking forward to a short-term surge and you are not sure, then you may also pay attention to setting a stop loss or something.
