But I was looking at GMX and like you say always do your own analysis.
GMX has grown 12% since Sep last year, this equates to about 117,272 tokens per month (an increase from 6.41m to 7.7m in an 11 month period) which when multiplied by its price comes to ~$4m dilution PCM.
When we look at the revenue generate in a month it is $1,895,718
(this is calculated by looking at total revenue generated $6.3m over a month and then taking 30% that is allocated to GMX users) this is a net loss of ~$2m PCM.
Surely this means it is not generating real yield, or am I missing something?
So I wrote about real yield being - people are using the platform with little to no incentives. $54mm of total fees and ~$16mm of total revenue since September of last year vs. 11% token inflation is fantastic. GMX does not have good data on their supply schedule, so I'm not entirely sure where this inflation is coming from. Said another way, the yield is not coming from these emissions (meaning the yield is real).
Ok I think I get what you are saying, The people who are trading on GMX are not being paid, or bribed, to trade on here by GMX giving them native tokens. People are using the platform because of the low cost to transact. GMX pays out is yield in ETH not in GMX.
'1~$16mm of total revenue since September of last year vs. 11% token inflation is fantastic.' (I think its actually 19% from your article, my bad). At what point would you think ok this inflation is too high?
Also if the price of the GMX was like 450 (like DYDX) would this worry you as well as this would mean a higher market cap dilution?
Yep - for example, if GMX emissions were completely shut off tomorrow, I don't think usage of the platform changes at all. I think the token inflation thus far has come from esGMX. But now they have really gotten sustained, organic usage, I don't think token emissions are needed at all.
hi Onchain Wizard, DO you think the risk reward of gaining eth yield on any of these platforms? Lido and Coinbase give you 4% off eth.. On one hand I need some passive income yet wary of another opaque platform like celsius
Its up to you, but I would assume there are smart contract risks with Lido, while having coins on coinbase has risks as well. For 4% yield, not sure its worth it imo. ETH basically moves 4% per day, so the yield isn't really that helpful.
Honestly, this is the best publication I've seen since the real yield narrative began. Thank you very much sir.
This is what I need more clarity; On the Dydx example, how you get in quote "90 days ago the total circulating supply of the sum of these tokens was ~115mm. Today it is 149mm"? I can't find circulating supply information on the supply schedule except indication of the token allocation.
Anyone who knows how he arrive at that should please help me. I've tried checking other options on the site yet can't figure out. Thank you 😊
Would love to see what you think of https://www.sphere.finance/ . I feel that they are in the category of real yield. Their goal is to build products that they hold a good portion of governance tokens on, and use the revenue to buy and burn the main token. They are a low cap token with a 11m treasury yielding 123k+ a month from farming. They've built so far a Dystopia and Penrose, basically curve and convex with better tokenomics with 18m and 15m in TVL, and they are taking those products cross-chain. First stop will be Binance releasing end of this month than Avalanche, and in talks with other major chains. Also will be releasing Preon a borrowing and lending platform where you'll be able to loop on stable LPs, and little-star which will boost the yields(not much info out yet on both). Also building Dyson farm a cross-chain yield auto compounder. Theres more to cover but i'll let you DYOR if this sounds interesting. Each product will have a bot that will use the products revenue to burn and buy the main token, sphere. This is all in a span of 4-5 months, so the team is incredibly fast at building.
It's a swiss engineered project based on BSC and provides stablecoin liquidity mining etc.
Would be interesting to know from you what you think of that, as it's built very well in my opinion. They just launched yesterday after 1.5 years of building.
Besides normal staking and mixed liq. mining, Grizzly offers stablecoin pair liquidity mining. With their "One Click Invest" Feature you only need 1 currency to do Liquidity Mining and Grizzly.fi takes care of all the necessary steps and optimization. This makes liq. mining a lot easier, which could attract a wider range of people. With "normal" liq. mining the impermanent loss eats up most of the profits. Also their UI is quite nice.
If the platform is safe, making excess yields in stables via token emissions is fine. But stable farm tokens tend to just bleed out Bc there isn’t really demand for them and the token gets dumped relentlessly
Nice one, thanks sir! Could you please dive into new BTRFLY?
great post, this the helpful stuff for me
Hi Mr Wizard,
As usual really enjoy your work.
But I was looking at GMX and like you say always do your own analysis.
GMX has grown 12% since Sep last year, this equates to about 117,272 tokens per month (an increase from 6.41m to 7.7m in an 11 month period) which when multiplied by its price comes to ~$4m dilution PCM.
When we look at the revenue generate in a month it is $1,895,718
(this is calculated by looking at total revenue generated $6.3m over a month and then taking 30% that is allocated to GMX users) this is a net loss of ~$2m PCM.
Surely this means it is not generating real yield, or am I missing something?
Thanks.
So I wrote about real yield being - people are using the platform with little to no incentives. $54mm of total fees and ~$16mm of total revenue since September of last year vs. 11% token inflation is fantastic. GMX does not have good data on their supply schedule, so I'm not entirely sure where this inflation is coming from. Said another way, the yield is not coming from these emissions (meaning the yield is real).
Ok I think I get what you are saying, The people who are trading on GMX are not being paid, or bribed, to trade on here by GMX giving them native tokens. People are using the platform because of the low cost to transact. GMX pays out is yield in ETH not in GMX.
'1~$16mm of total revenue since September of last year vs. 11% token inflation is fantastic.' (I think its actually 19% from your article, my bad). At what point would you think ok this inflation is too high?
Also if the price of the GMX was like 450 (like DYDX) would this worry you as well as this would mean a higher market cap dilution?
Thanks as always
Yep - for example, if GMX emissions were completely shut off tomorrow, I don't think usage of the platform changes at all. I think the token inflation thus far has come from esGMX. But now they have really gotten sustained, organic usage, I don't think token emissions are needed at all.
hi Onchain Wizard, DO you think the risk reward of gaining eth yield on any of these platforms? Lido and Coinbase give you 4% off eth.. On one hand I need some passive income yet wary of another opaque platform like celsius
Its up to you, but I would assume there are smart contract risks with Lido, while having coins on coinbase has risks as well. For 4% yield, not sure its worth it imo. ETH basically moves 4% per day, so the yield isn't really that helpful.
Honestly, this is the best publication I've seen since the real yield narrative began. Thank you very much sir.
This is what I need more clarity; On the Dydx example, how you get in quote "90 days ago the total circulating supply of the sum of these tokens was ~115mm. Today it is 149mm"? I can't find circulating supply information on the supply schedule except indication of the token allocation.
Anyone who knows how he arrive at that should please help me. I've tried checking other options on the site yet can't figure out. Thank you 😊
Use Messari - you will find it there.
Would love to see what you think of https://www.sphere.finance/ . I feel that they are in the category of real yield. Their goal is to build products that they hold a good portion of governance tokens on, and use the revenue to buy and burn the main token. They are a low cap token with a 11m treasury yielding 123k+ a month from farming. They've built so far a Dystopia and Penrose, basically curve and convex with better tokenomics with 18m and 15m in TVL, and they are taking those products cross-chain. First stop will be Binance releasing end of this month than Avalanche, and in talks with other major chains. Also will be releasing Preon a borrowing and lending platform where you'll be able to loop on stable LPs, and little-star which will boost the yields(not much info out yet on both). Also building Dyson farm a cross-chain yield auto compounder. Theres more to cover but i'll let you DYOR if this sounds interesting. Each product will have a bot that will use the products revenue to burn and buy the main token, sphere. This is all in a span of 4-5 months, so the team is incredibly fast at building.
Thanks a lot for your content.
Just got into a project called grizzly.fi
It's a swiss engineered project based on BSC and provides stablecoin liquidity mining etc.
Would be interesting to know from you what you think of that, as it's built very well in my opinion. They just launched yesterday after 1.5 years of building.
There are plenty of stablecoin farming projects, so what makes this one special?
Besides normal staking and mixed liq. mining, Grizzly offers stablecoin pair liquidity mining. With their "One Click Invest" Feature you only need 1 currency to do Liquidity Mining and Grizzly.fi takes care of all the necessary steps and optimization. This makes liq. mining a lot easier, which could attract a wider range of people. With "normal" liq. mining the impermanent loss eats up most of the profits. Also their UI is quite nice.
Yea I’m just saying stablecoin farming tokens do not tend to do very well
Yes got you :) but maybe during bear markets it's an option. Thanks for your reply 👍
If the platform is safe, making excess yields in stables via token emissions is fine. But stable farm tokens tend to just bleed out Bc there isn’t really demand for them and the token gets dumped relentlessly