Return of ETH Defi - Alpha, Sushi, Aave - Testing Matic and Solana
Not financial advice
Uniwhales
Matic/UNI/SRM/Sushi being traded heavily. Reflects trending assets on Coingecko with the exception of Sushi. Sushi is now down 64% vs ETH since it topped out in March ( chart below). It is the 4th most valuable network in terms of fees generated. Maybe time for a bounce? https://cryptofees.info/
Could the release of Deriswap be a catalyst?
Unique Sushi addresses
Overall valuation metrics look favorable. Although these come second to narratives in a bull market.
Playing with Matic
I transferred some MATIC and ETH to the POLYGON network to try some of the farms based on @Cryptoyieldinfo and @Bambouclub. Had trouble with VFAT.tools because I was being rate limited and its tricky enough to get Matic from the Ethereum to Polygon network using Zapper. ( I used Matic Web Wallet v2 https://wallet.matic.network/ in the end)
Most people seem to be farming either Aave or Curve on Polygon, but I decided to just go degen with a small amount and farm some KRILL with ETH on polywhale.finance. It’s just learning/degen money, but sidechains like BSC and Poly should be treated with caution. They are very dependent on a few individuals as opposed to zkstarks or optimism which are much more censorship resistant. I expect to either farm high yields and escape or get rugged.
Playing with Solana
I transferred some SOL from FTX to Solana via the SOLLET browser extension. I used Raydium to stake some Ray/SOL. There are good yields but I’m increasingly seeing all other chains as Ethereum overflow channels. Now that ETH fees are down I expect a return to strength for ETH and Eth Defi as smaller players try out the new, cheaper networks.
AAVE
With the Matic news brought growth in TVL ( defillama) and strong growth in active addresses. This ties in with my general thesis that ETH Defi may be about to return.
ETH calls
I bought lots of ETH calls on deribit for end of May with a strike price of $3000. Partly because I have sold much of my ETH for Defi but I still want some upside exposure. If the yearly uptrend for ETH below is maintained I should make some profit. Let’s see.
Alpha
Its not really my game but it looks like AlphaUSD is undergoing a classic range reclaim as described by Donalt and Cred. If it is, next stop might be 2 dollars. I hold some spot Alpha mostly because the team is very smart although they have been a bit slow to bring in new, high yield ideas.
Conclusion
Over the last week I struggled not to get too depressed about the larger swings that have come with increased volatility. I’ve tried to remind myself of a few things to deal with this.
All bull markets tend to increase volatility. In relative periods of calm like the 10th of April, its a good idea to buy volatility through a straddle or strangle.
Focus more on buying deeper dips, and accepting some misses. Try put small buys at 20% , 30% or 40% down from ATH.
Look at the ETH/USD/BTC pair on each bet. Do they tell different stories? If so, just wait.
Sell high funding when margin trading and wait. This is probably the hardest thing to do as it usually reflects a period of excitement in the market. But high funding almost always results in a meaningful correction.