Cinneamhain Ventures partner Adam Cochran’s “shopping list” for 2022.
1/204 As I promised, here is my 2022 cryptocurrency “shopping list” and 2022 start-up forecast article. Let’s analyze why certain assets were chosen, how to operate them, and the bullish scenario for each asset.
2/204 First off, here’s a “shopping list” that I think will do well in 2022. This means that instead of buying all of these assets at once, I will prioritize “buying the dip.”
3/204 I think it will also outperform indices, major assets (BTC) and their peers. This means that some good items do not appear in this list. For example, Solana made a breakthrough this year, but predicts that it will be difficult to break through next year.
4/204 Solana could also rise (or a little more than an index). Many projects in its ecosystem are also under the FDV (Fully Diluted Valuation) spell, so even if they are great products, they are unlikely to do well in the new year.
5/204 Conditions to appear on my 2022 cryptocurrency “shopping list”:
- the product is in operation;
- There is a catalyst to make it explosive in 2022;
- Compared with peers, there is room for growth;
- have external cash flow.
6/204 There are still a lot of great technologies and projects that didn’t make it to this list because 2022 simply isn’t the year of their explosion. People greatly underestimate the time it takes to build, roll out, and sustain market growth.
7/204 I think there are good reasons for these assets to outperform. However, it’s worth remembering that obviously not all of these assets will be hit. Nor can you put all your assets in one portfolio equally.
8/204 As a long-term value investor, I may reconfigure my portfolio, I am willing to have a 60%-70% error rate, hold the project for 5+ years, and lose up to 100% on any asset I start 3 years.
9/204 Normally, I wouldn’t have this loss-making situation happen, but investing in real assets that aren’t just hype is like investing in startups, you need to invest for the long term.
10/204 So why are these assets on the list? Next is the summary of my 2022 opening forecast article:
Cash flow is king, infrastructure is king.
11/204 We’ve gone through another bubble, hype bull cycle. It attracted a lot of people into the circle, made a lot of money, and practically everything was nothing.
12/204 As traditional markets go through this, we see a shift from what we call “growth stocks” to “value stocks” as people seek truly stable returns to protect speculative currency gains.
13/204 We don’t really have “value” stocks in most cryptocurrency cycles. Almost everything is priced based on the “future” (and let’s be honest, retail investors have no idea how much things are worth, especially in the future).
14/204 However, that started to change with the popularity of cryptography and we started to see that the protocol did generate revenue. The crypto asset analysis tool TokenTerminal gives us a good look at the many protocols that are starting to drive real revenue.
15/204 Even those protocols that don’t yield tokens are still in huge demand at the moment, such as lending protocols, with lending rates increasing by an average of 10x in 2021.
16/204 Dissecting the quality and source of earnings is important and complex. But one thing’s for sure, protocols with real gains tend to underperform in 2021.
17/204 Because 2021 is a growth cycle for cryptocurrencies, when we’re stuck at home with checks in hand and eyes sparkling, we look to the market together and think “yes, this Dogecoin could be future”.
18/204 So anything that is not loaded and loaded is punished and oversold. Because the reality is that most people don’t realize the time, complexity, cost, or upper bounds of the potential to grow a business.
19/204 At the end of the day, what matters is cash and value. If you provide a valuable service that is worth protecting or controlling, people will buy it. If you have a profitable product, people will buy it too.
20/204 Because the cash supports the construction team, building products that can cross the chasm and provide value. That’s why you’ll see a lot of my picks for 2022 from classic DeFi products made by teams that have spent 5+ years in the market building.
The 21/204 bubble will fade away and we will move to products that make money and have a broad, real, value-added user base.
22/204 The second category is infrastructure. This year, with the help of L1, we learned that there are still many gaps in the tooling.
23/204 I don’t think we’ve done a lot on this this year, it’s not enough. But what we do is validate the requirements.
24/204 We saw L1 and L2 debut, which gave us an idea of how unusable and insecure cross-chain bridges are. We also learned that in L2 with lag, people are willing to pay a premium for instant.
25/204 From Buterin’s earlier Ultimate War article, we learned that Ethereum’s path forward actually looks very much like a multi-chain world. When forks exist, moving between them is a bit like moving between L2s.
26/204 We are starting to see some of the plans Avalanche is doing with subnets, and projects like Cosmos and Atom are also being considered.
27/204 All this confirms a huge critical issue. In a multi-chain world, the availability of data and assets is a huge gap. We need reliable data, across networks/chains/forks, and move assets quickly that way.
28/204 Most solutions like multi-chain indexing, on-chain tokens, or full-fledged scaling solutions will not have a good case for them in 2022. I’m guessing in 2023-2024.
But some like real-world assets, on-chain futures and cross-chains may be ready for prime time.
29/204 Infrastructure investment is plentiful and most will be mediocre.
Like the AMM boom we saw after Sushi, 99% of companies fail. But the winner will be like a bandit grabbing market share for years.
30/204 During the year, other things may pop up, maybe we will stumble upon a new raw data, or a new scaling technique that will give us real benefits.
But all of this was a flash in the pan for me, and I wasn’t interested in investing in short-term projects.
31/204 Instead, 2022 is the year to focus on the real value drivers that I think can break through, outperform 2022 performance, and then keep and sustain value moving forward.
Let’s start analyzing this cryptocurrency “shopping list” together.
32/204 This list is organized by game level list.
33/204 I’ll explain each category and the assets within it.
Remember, these are my personal choices that make sense in my smooth long-term portfolio with diversified risk, high risk tolerance, etc.
This is not investment advice, be careful.
34/204 I’m not good at naming things, these are what I think are the best picks for 2022 that will perform well and stay strong.
They are basically assets that I bought, pledged or locked.
35/204 A big driver for these assets is not that I personally think they will only appreciate significantly in the future, but that they have lucrative external return drivers that give them potential.
36/204 This means that the returns from staking/locking these assets have APY (Annual Yield) payouts, cover the asset’s substantial cost risk, and are external non-dilutive income.
37/204 What’s more, most of these assets are also tokens large enough that you can borrow liquidity from multiple providers, allowing you to defer taxes while still doing other things.
38/204 So my top four picks include the following four assets:
- $ ETH
- $ YFI
39/204 $ ETH
This should be obvious, I’ve been saying that ETH 2.0 drives huge economic cycles.
The crypto war drums will be louder as the merger approaches, and I think we’ve had our first shot in ’22.
40/204 Before EIP-1559 was implemented, so was the prediction that ETH 2.0 would actually create a price up cycle, so that would be a 10x potential.
41/204 As scaling solutions grow, ETH in the EIP-1559 burn and the upcoming merge, ETH will be a tough opponent to beat and I think it will outperform any major asset .
42/204 $ YFI
For Yearn, I’ll follow last week’s top picks.
Their growth, external revenue ($100M+/yr excluding no incentives), token model change, upcoming buybacks ($45M) and use cases make me think they beat ATH this year.
I got into CVX very early and called it the “King Maker” of DeFi.
I think it’s likely to continue going strong into 2022, but it wasn’t on my outperformance list before.
44/204 Three things changed this:
- Votium bribe: They are growing much faster than I expected and validate the model;
- Curve V2: Will acquire most of the AMM (Automated Market Maker) volume for new projects;
- Convex extends outside of Curve (see cvxFXS).
45/204 I hope to keep my CVX locked in (roughly 50% annual earnings, around 2.4x P/E), and CVX could grow another 2x this year.
46/204 With these changes rapidly progressing towards the end of the year, I still probably won’t hold back if CVX trades at 8x to 10x its current value over the next few years, which would still make it one of the most profitable P/E assets.
47/204 I think CVX might be worth it if it can take down other DeFi protocols as well, not to mention if Curve V2 can take down the AMM (Automated Market Maker) market.
48/204 For CVX, I just plan to relock my $CVX every epoch, delegate to the Votium app, and continue to be rewarded when it takes over DeFi governance.
At current returns, CVX drops by 50% and you can still break even on staking.
I wrote a post on Keeper last week as my pick.
The general view is:
You buy two agreements for one dollar.
The FixedForex project is actually what the founder of Yearn Finance built Curve for international currency.
50/204 TradFi Forex trades off-chain at $6.6 trillion per day. Eventually, some will move on-chain.
Keeper is growing fast in this market and it has helped change the game for international users as payment channels bite us.
51/204 My other guess is that at some point $CVX started to eat #KP3R just like they will eat FXS. This will add compounding value to both.
52/204 Strong advantage:
In my opinion, this class of assets has a key catalyst in 2022 to strongly outperform their peers.
Many of these assets are oversold, but some have growth potential.
53/204 So which assets fall into this category?
- $FLX (Reflexer Protocol)
- $ RBN
54/204 $FLX (Reflexer Protocol)
The creators of the $RAI stablecoin, I wrote a dedicated post for them. Presumably the content is that $RAI is the purest stablecoin, yet overlooked and contains many key catalysts.
55/204 I think in the long run Web3 will adopt its own stablecoin and you will see a weakening of dollar denomination. $RAI is the perfect candidate and that is its long-term driver.
2022 will be its first breakout.
I don’t have an overview specifically for Curve, but the bullish side here is simple.
Although I think the output value of its stable pool (StablePool) is too frothy, Curve2.0 changes all that.
57/204 Currently, new projects are usually invested through the Sushiswap Onsen mining pool, while major projects are usually traded through Uniswap.
The complexity of 58/204 UniV3 caused many traders to lose funds intermittently. This is great for professional market makers, but mainstream users don’t like the complexity.
59/204 Sushi is also going through its own chaotic period, and while I think it can come out of the woods, it will take a while to gain a foothold, leaving a huge gap in the AMM market.
60/204 I think most of it is filled by $CRV, $BAL and $ZRX.
But the Curve incentive mechanism will easily be a new way for projects to incentivize their mining pools at launch.
61/204 This will bring new users to Curve, help them capture routing volume, and get more projects interested in Convex and Curve.
The only way this doesn’t happen is if Curve is too slow to roll out more V2 pools, or if governance gets in the way of too much judgment.
62/204 Overall, this is a huge opportunity. I think they will easily capture these advantages and will result in a significant advantage performance (measured in price appreciation + staking returns).
This is another project that I haven’t specifically discussed yet, but $ALCX is one of the few projects that I think has “growth” potential in 2022.
It is one of the riskiest of these senior assets, but also has high potential.
64/204 AlchemixFi’s self-pay loan is one of the best new DeFi designs we’ve seen over the past few years, but it’s not without hurdles like token economics and efficiency.
65/204 They are back on the development map and have been working on AlchemicxV2, addressing many key issues and making some ambitious additions.
66/204 When we think about growth rather than value, the most important question is “Can this be a fundamental primitive element used by other protocols?”
The answer is yes.
67/204 This self-paying loan model creates enormous opportunities for investors to take on risk and leverage in an evolving system, but with a cap on returns.
68/204 The addition of a new strategy model makes it essentially a mini-Yearn where you can borrow money and repay it yourself.
69/204 This is a project that I’m prepared to pay for years at a loss because I think it changes the game mechanics. However, I think the release of V2 could be a game changer for $ALCX and it will do better this year.
Balancer is a classic DeFi protocol that has been oversold and overlooked.
71/204 But to sum it up, Balancer has huge potential to become one of the most important AMMs in the space, whether or not anyone visits the Balancer site.
Balancer excels at creating incredible foundations and flexible techniques.
72/204 While the technology is still working to improve gas fee efficiency, it has become an incredible cornerstone that underpins some great use cases and high performance capital efficiency.
73/204 Their partnership with Gnosis on Cowswap will make them a key component of future asset management.
74/204 While I think classic DeFi will have a strong year, I think $BAL has huge potential to outperform, especially as they move to the veToken model (which makes them another great Convex candidate).
75/204 While they may have a great year this year, I think their real advantage will be on a multi-year time frame, and I’m counter-guessing that they will become a stalwart by supporting U.S. Treasury volumes, indexation, and LBP token offerings. Top AMMs.
76/204 These are all things that the multi-asset capital efficiency that Balancer has cannot do.
So if they execute correctly, this is a market that fits them perfectly.
0xProject is another overlooked DeFi infrastructure component that I think will make 2022 a breakout year, mostly driven by end-user wallet adoption.
78/204 This is actually two components of my 2022 opening article as it has both strong external benefits/adoption and is a key pillar of the multi-chain future as 0x is the strongest competition for building cross-chain DEX tools opponent.
79/204 If we tie $ZRX to the CEHV blockchain OSI model, I think 0x will be at a lower layer of infrastructure and be the tool most public chains and wallets use for order filling.
80/204 Currently, when users trade in MetaMask and other major wallets, they use 0x without knowing it. This trend will continue as we see retail expansion in L2 through accessibility.
81/204 I think with the L1 and L2 expansion in 2022, the MetaMask token will likely be launched, Requests for Quotes (RFQs) and some key tool upgrades for cross-chain transactions will make it a driving year for 0x, but here’s one too long-term consideration.
82/204 Token economics are unsatisfactory for some, this will definitely make the price oversold, but I think in the future 0x will be as ubiquitous as leading banking software, which will strongly drive node operator returns , and in turn pledge.
I added Frax to this crypto “shopping list” a few weeks ago and it has already exceeded my expectations.
To sum up, Frax is probably the best integrator in the stablecoin space.
84/204 I underestimated them for a long time, but they have proven time and time again to be strong performers when it comes to trying new financial models and definitely a strong performer when it comes to building diverse value-added cross-chain bridges with other protocols the best.
A recent example of 85/204 is their collaboration with Convex on Frax FPI and cvxFXS integration, which will be airdropped in the coming weeks.
86/204 If there are two things in this space that are not worth underestimating, it is the ruthless builders and the ruthless cross-chain bridge builders.
Frax contains both.
87/204 $ RBN
Ribbon is one of the few assets I like that is in a tough spot for FDV (Fully Diluted Valuation).
But I think the token economy, distribution model, upcoming lock-up model and external benefits more than make up for it.
88/204 My theory is that no matter how hard we try, we can’t teach 99% of people to make the right choices.
A joke from CMS illustrates this well:
I trade options professionally, but I still don’t think I should be allowed to trade options.
89/204 But that doesn’t mean that, when used properly, options can’t be lucrative.
90/204 users participate in and benefit from a pool of funds using predefined pre-built options strategies.
As we saw at Yearn, the best strategies for treasury are those that are so complex that you can’t really replicate it even if you know what they’re doing.
91/204 I bet 90% of the treasury holders on Ribbon can’t replicate their treasury strategy, but they might be happy to get 30% back on projects like ETH and USDC.
92/204 This means that Ribbon will drive value through the distribution of external rewards rather than just $RBN.
And, since it doesn’t engage in mining like the Yearn treasury, its model can pay off handsomely in bull or bear markets. This is very unique to this field.
93/204 Token economics and treasury caps hold them back because the reality is that you can’t get unlimited scale returns from options.
But that’s why I find Ribbon interesting.
I think this may be the only way to achieve a fork.
94/204 Just like a large number of retail investors cannot build an advanced mining strategy and need the assistance of Yearn, most people cannot build a selection strategy and need the help of Ribbon.
Ribbon needs more option players to help it grow.
95/204 Most option agreements require order-of-magnitude provider growth and cannot easily attract users at scale.
So Ribbon and the upcoming on-chain options protocol actually make each other viable.
96/204 Not to mention that Ribbon is redesigning its token economy and switching to the veToken model, another prime candidate for future Convex integration.
97/204 These are my “safe” operations in 2022. I don’t think most of them will be 10x growth, but I think they will provide strong growth, less downside risk and clear value.
98/204 The list also includes some games that I think will fall into this category in the future, but they are still in the early stages of gestation.
The list of top-performing assets in 99/204 is as follows:
- $ FTM
- $ ZEC
- Euler Finance (note, there is a similar naming protocol, tokens also exist)
100/204 $ FTM
In the L1 collection, Fantom is favored by its peers.
Unlike other VC-heavy L1, and VC-owned projects, Fantom feels more like early Ethereum.
The 101/204 aBFT model offers strong scalability, staking offers solid lock-ups (and decent APR rewards for holding), it has many early stage projects, and good builder incentives.
102/204 I think Fantom has attracted a lot of new users and builders and has paid off handsomely this year as users look for more L1s after the L1 craze is over.
Avax’s breakout came earlier than I expected, so I’m more of a wait-and-see approach, thinking it might struggle to continue its stellar performance.
But to be honest, if you look at it in a single basket, I think it will still perform better.
104/204 Compared to Polkadot, Cardano and Polygon etc. Avax has the clearest scaling path of any major EVM (Ethereum Virtual Machine) based asset at the moment, I do think the subnet model is a game changer.
The 105/204 subnet model is basically like a miniature version of the fork, allowing anyone to build a purpose-driven Lisk, so I think a lot of the early experimentation with the Ethereum fork that we need will happen in the Avax subnet.
106/204 Catching this innovation will benefit, so I think Avax still has a good year ahead.
107/204 $ZEC (Zcash)
I respect but disagree with some of Barry Silbert’s expositions (though they are at least well-founded), but the Zcash token is the one I totally agree with.
108/204 The privacy advantages of ZCash are one thing, but the massive amount of research that ZEC does that is critical to the ecosystem is where the real magic lies.
109/204 ZCash has been working on zero-knowledge proofs long before most people in the industry have heard the term zero-knowledge proofs.
110/204 Back in 2018, Buterin and ZEC founder Zooko proposed a vague concept of how to merge Zcash and Ethereum:
That said, the merger of the 3 tokens is interesting. The idea is “Zcash Frontier Edition”, which is to combine ETH and ZEC currency balances, combine ETH PoS (Proof of Stake) + fork, and integrate with ZEC’s first-level snark architecture, then “pure Zcash” may be more conservative.
111/204 This doesn’t sound like the Zcash integration we’re doing today, but it’s the core philosophy that drives my personal investment in ZEC.
112/204 As we become clearer about what a merged, forked, sidechained, multi-L2 future world will look like, it is clear that there is a huge opportunity for a second layer ZK transport protocol on Ethereum.
The specifics of 113/204 are not yet known, it can run in L2 style like the Starkware app, or on an L2 cross-chain bridge like rollup (Arbitrum/Optimisim).
114/204 In the end, my point is that Zcash finally built the privacy transfer/zk-snark layer that Ethereum has always needed, while the rest of the world ignored it as a separate thing.
115/204 Maybe it just continues as an independent chain and we get better at interoperability across chains. However, I think ZEC will blend into the Ethereum world at some point, and either way it will be a key part of Web3’s value transfer.
116/204 Gearbox Protocol
The governance token for gearbox.fi exists, but is not tradable yet. It looks like airdrops/mining from the protocol may continue.
117/204 The protocol is basically to help bring leverage/margin to DeFi.
As we know, leveraged trading volume on CEX exceeds spot trading volume by at least 5:1 on average.
118/204 But this advantage is lacking in DeFi, which also means that in the early stages of investment and construction, when the token is not listed on the centralized exchange, it is already missing.
119/204 Suppose you find a new token you want.
You have $100 in collateral.
On CEX, you can long $2,000 of tokens, but in DeFi, you can only mine with that $100.
120/204 With the Gearbox protocol, you have the opportunity to open credit accounts, allowing you to take leveraged positions and use them in various DeFi applications, allowing you to stay in a decentralized environment for a long time.
121/204 This is a game changer, not only for Gearbox, but I actually think Gearbox will drive the classic DeFi 1.0 blue chip growth this cycle.
Just as perps/futures did to CEX volume, it will also do to DeFi volume.
122/204 While the coin is not yet tradable, I think it will be strong in 2022.
Euler is likely to be the first major overhaul of the lending model since Aave.
It’s a whole new vision of lending protocols.
124/204 A clever contract/account model and the ability to create independent pairs from a diverse set of oracles including AMM pools creates huge opportunities for different asset growth.
125/204 A problem with most loan agreements is that they are only as strong as their weakest asset.
That’s why we’re seeing so much disruptive behavior at Cream.
126/204 Euler carefully balances four types of markets:
Collateralized, Crossed, Isolated and Protected.
127/204 This would allow them to remain independent of the risk market, but not require a license, while still allowing them to leverage collateral to borrow major and diversified assets.
128/204 Not only do I think this will make Euler itself competitive, but like Gearbox, I think it will create benefits for blue chip DeFi tokens.
129/204 Borrowing is difficult on many new protocols where user funds are locked up.
Euler will release a lot of idle capital for more diverse markets, which will breathe a lot of life into the blockchain space.
130/204 Value-Driven/Multi-Year Outperformance:
I don’t know if 2022 will be their breakout year for these types of staking, but I can strongly demonstrate that it is possible. I believe that even if they don’t break out this year, they will outperform most assets within a few years.
131/204 These assets include:
- $ MKR
- $ HNT
- $ SNX
- $ SYN
- $ GNO
132/204 If you’re a value investor who has believed in this space for years, take the time to dig into it.
133/204 $ MKR
With huge cash flow, $DAI isn’t going away, it’s one of the few organizations that has survived multiple iterations of community and leadership and made it a real-world asset.
134/204 I’d rather they stick to pure money, but I can’t carve a lucrative path in front of them that pays off steadily every year.
135/204 As we move to a market dominated by institutions and bankers who target lower returns than cryptocurrency traders, they will continue to eat these assets steadily.
$ 136/204 HNT
Is this a bubble? Yes.
Is 2022 the year of their rise? Leave it to fate.
137/204 They still have a long way to go, but the global coverage of Helium nodes is impressive, and the way we see telcos groping for 5G and pursuing Helium in the physical connectivity layer of 5G and IoT is impressive deep impression.
138/204 I’m willing to accept the fact that 2022 can’t be a great year for them, but it’s still on my “shopping list” as I’ll be buying it with the rest of the year’s profits as it has obvious long-term competitive advantage.
Having an LDO is basically having an index of all possible L1 and L2 solutions.
It can quickly consume these resources and is a profitable path.
People worry about FDV (Fully Diluted Valuation). This is a rare situation that I haven’t encountered.
140/204 The chance to gain from 10% of all L1/L2 captures is worth it.
Much of the early pre-sale stuff has changed hands off-market for higher prices and years of lock-in.
141/204 Also, there is a future path to swallow staking/node operations for non-L1 protocols.
For me, $LDO is one thing I buy so that I don’t have to focus on what the next profitable L1 is, I can just own a portion of it.
Lending giant, a team that excels at problem-solving.
First explore multi-chain by choosing Lisk.
They have a hard time dealing with substrate.
143/204 But the team continues to execute and I have no doubt they have been working on the Lisk model.
144/204 Here’s what’s left.
145/204 Multichain Dapps are not bad either.
But Lisk Dapps are where interoperability needs to arrive for future capital-efficient use.
In this regard, I am afraid there is no more confident team than Compound Labs.
146/204 One of the only Dapps we’ve seen that builds itself in this way is Luna.
147/204 There are huge benefits and flexibility to run your own Lisk, and $COMP will be the foundation of their Lisk validator, which is why they will have a lot of OTC market transactions.
148/204 I’m kind of looking forward to the infrastructure they’ve built on the Avax subnet, but no matter how it goes, I think the COMP chain will melt because it’s oversold.
There are two major auction houses in the classic art world (Sotheby’s and Christie’s).
They are all aware of the growing market for NFTs and digital products.
150/204 Sotheby’s has been actively exploring the world in a way that shows they really know it.
But in both competitions, I think one of two things will happen.
151/204 Whichever auction house leads in NFT trading market share will buy a market to cement that lead.
Alternatively, the lagging party will catch up by buying the market.
152/204 This acquisition will focus on the native NFT gaming market most similar to what traditional auction houses have in terms of branding, professionalism and user settings, so I think this will be the future of the $RARE token.
153/204 I think they were either bought by a classic auction house, or at least a big stake in a classic auction house.
I guess it will happen in 2022. But only possible.
154/204 $ SNX
In Frax before, I said that you should not underestimate the ruthless builders or cross-chain bridge builders.
SNX, too, is vastly oversold.
155/204 This year alone, they have significantly increased demand and the ecosystem is piloting 5 new products, all in sUSD.
It also integrates well with FixedForex, so I think the benefits of KP3R also help drive them.
156/204 If one of their ecosystem projects or partners has a breakthrough year, so does SNX.
They have a lot of shots, so this bet is all about the numbers and confidence in the builders.
157/204 $ SYN
Cross-chain bridge infrastructure is critical, and so are the benefits.
Users are willing to pay for Synapse because it is the best cross-chain bridge between L1 and L2.
158/204 They need to expand their pairings, but I decided to try every single cross-chain bridge this year.
This is the cross-chain bridge we are going to use.
159/204 $ GNO
From the current products, Gnosis will be the only one that can achieve MEV scale.
Leading products with their own extended network will be pushed into each Gnosis Multisig after the xDAI merger.
160/204 Can you come up with a project worth paying attention to without using Gnosis Multisig?
All of the biggest pools, the best builders, and the biggest funders will be at the forefront of GNO expansion and MEV prevention.
161/204 Risky but potential:
I don’t know if this type of asset will be successful.
We’re in a high-risk world right now, and if they don’t capture the market, there’s a risk of loss, but these products have strong potential.
162/204 For example, we know that the amount of perpetual contracts is moved on-chain. CMS holdings have been shouting on the roof for years, but we don’t know who will win most of the market.
163/204 It may be that some players got some crumbs, but 1-2 players took the chance.
As an industry, on-chain perpetual contracts will definitely perform better.
164/204 If you can spread your bets across every potential player, the big gains (especially multi-year gains) of the winners will make up for the underperformers.
165/204 So who falls into this category?
- $ CAP
- $ HND
Perp has a strong lead in this area, and DyDx has certainly derailed their momentum, but as I said earlier, I think they have a clear path to winning.
167/204 Perp really needs to execute the long tail of on-chain futures fast, but if they can do it with Curie (their V2), then 2022 is a breakthrough year for them.
Futureswap (futures trading) is another important futures operation.
One thing I like is that it integrates directly with Uniswap V3 positions for capital efficient positions on AMM.
The simplicity of its mining pool could be a key driver.
169/204 $ CAP
It’s a 100% loser in this game and I love it.
I was skeptical of them at launch, but the execution by an anonymous community-driven team is pretty solid.
I don’t think it has the top spot in perpetual contracts, but there is a lot of upside potential.
MCDEX is too hard for me, I’m only half sure.
I think this is the least likely to get the first place. But given the upside potential of all perpetual contracts, and high-quality UX investment, it’s still worth staking if it does win.
If someone could provide mainstream users with options in an accessible, scalable way, Dopex would be the way to go.
It is the best on-chain setup and user experience.
The 172/204 Dopex game goes well with Ribbon.
Ribbon needs Dopex extensions, and Dopex needs Ribbon extensions, so there’s huge potential here.
173/204 $ HND
Hundred Finance is probably the earliest/riskiest of this class of assets.
It only recently came up on my shopping list and I haven’t started shopping yet.
174/204 But this is vfat0’s cross-chain lending and it’s still in the early stages.
If anyone knows the inner workings of the mining token economy, it’s vfat, so it’s a concern.
175/204 As the market recovers into the new year, I plan to put a lot of money into this area and expand my position size as liquidity grows.
Another asset that I think can hold a thigh.
As we move into a multi-chain and forked future, we do need more oracle diversity and new types of data availability.
177/204 I think API3 is easy to overlook, but I think they have built a solid foundation for a complex problem.
So 2022 is a make-or-break year for them, and I think the odds are better given the long-term infrastructure needs.
Like I said on FixedForex, if you are American, you probably don’t know the pain points of international users when facing currencies in this market.
179/204 Angle aims to be like MakerDAO, but starting with the decentralized euro.
My hunch is that they have solidified their position by expanding into other currencies and having key partnerships with Convex and KP3R.
180/204 The only reason they rank so low is that they already have strong outperformance.
I think they will outperform multi-year performance by a wide margin, but will need key drivers to materialize in 2022.
181/204 High Risk: This is my 50x or 0x game.
If they show up, they will do well. I don’t think most people will show it. This is the absolute risk assigned to you.
182/204 Who is at risk of a boom or bust?
- $ GEL
- $ REWARD
- $ PENDLE
183/204 $ GEL
Automated smart contracts. I think other technologies like KP3R and OpenZepplin Defender can make their money, but if they can build proper libraries and integrations for any major update, it’s a win for them.
184/204 If I were them, I’d focus on finding every big user of KP3R or OZ Defender and go to those protocol competitors and get them to use Gelato.
An enemy of an enemy can be a friend.
The adoption of mainstream NFTs will likely continue to grow.
Mainstream players aren’t going to push cap prices up because they aren’t going to buy a $100,000 PFPS.
Segmentation is the reason for the transfer of tokens.
186/204 When 100,000 people can buy an extra small unit, retail prices fluctuate.
NFTX offers this possibility, it can be combined between different projects and gamified.
If we do see a boom in NFT trading caused by the CEX market, NFT trading will also benefit.
I like the cash-driven spending channel.
This is the only viable token.
The option space for $SNX to play. Perfect robust product. Not as attractive as Dopex, but also cheap.
189/204 If Ribbon really broke out, then it would indirectly develop all option providers. Because it needs to push capital into new markets.
Given the way $THALES is priced, it’s a must for me to get some exposure here.
Another place I couldn’t get started was due to low liquidity. Auto-staking for liquidity pools, oversold and part of the Yearn ecosystem, has been less popular lately.
191/204 This is still a good product and I think as we see more coffers growing, it has a chance of being popular because of the low market cap and the ability to generate external gains.
I think some aspects of issuance and token economics are prosaic, but can solve problems. The product user experience is confusing, but the technology is solid.
193/204 As we move into an increasingly retail-oriented world, I think wallets/interfaces like Zapper and Argent will be looking for more treasury strategy style integrations for their users.
194/204 $ AWARD
It’s the least interesting option, but still a high-quality product.
Given my strong thesis on Ribbon, it will probably perform better in the context of Ribbon’s growth.
195/204 $ PENDLE
I love Pendle, I think it’s amazing.
I don’t think most users even understand what it’s trying to do, let alone how to use it.
If Pendle focused on education and integrated it into the treasury strategy product, that would be a huge boon.
196/204 I made the mistake of overestimating the financial sensitivity of my users, so they performed below my expectations.
I think there is a clear path for them to get the growth the product deserves in 2222.
197/204 Mining Possibilities:
Since potential tokens are coming, I think this type of protocol might be worth interacting with, but nothing has been announced yet.
198/204 These categories are not broadly categorized, but they are shared with you:
- Element Finance
- Cozy Finance
199/204 Here are my picks and cryptocurrency “shopping list” for 2022.
Again, this is not financial advice.
You shouldn’t blindly imitate and expect to win.
200/204 I tend to track assets and maintain my shopping list, which I update about every three months. I scale my positions proportionally, balancing different levels of risk.
201/204 Overall, I think 2022 will be an exciting year for cryptocurrencies. The rebirth of classic DeFi blue-chip stocks, exciting new DeFi models, and some technologies are starting to cross the chasm.
202/204 has many more assets that are not on this list but are doing well, especially if the overall market is doing well. These are just my personal bets on assets that have a “chance” to outperform.
203/204 As a standard disclaimer, I obviously have a financial interest in many/most of these tokens (or all of them as you read it) and have my own bias.
204/204 We hope this article has been helpful in guiding your own research starting points and ideas for building assessment projects. Let’s toast to an exciting 2022, whatever this crazy world has to offer.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/adam-cochran-4d-analysis-of-where-the-wealth-code-will-be-in-2022/
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