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4) A lot for this will come down to what you think DeFi should be worth. For now, I'm going to make the following arbitrary assumption: that ftx.com/trade/DEFI-PERP is "fair". DEFI-PERP is currently basically made up of the largest DeFi projects pre-yield-farming.

Cryptocurrency Derivatives Exchange

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5) So, the projects in DEFI-PERP are worth about $200m-$2b right now. I think that optimistically, vegetables all together are worth about as much as the rest of DeFi -- so maybe like $6b or so.

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6) That means that giving away all the yield farming coins can generate at most that amount of valuation, and that amount of transaction costs. So how much is it in fact generating?

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7) Well a few of the valuations make no sense, and I don't really know who's buying them. If you remove those, things actually aren't that crazy. YFI is at $1b, some of COMP/BAL/SNX/LEND comes from this, and then a collection of tokens around a few hundred million.

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8) OK, and how about the transaction costs? Well people are spending about $100m per month on gas. In addition people are locking up about $10b of capital; if you use 20%/year as the baseline Crypto cost, that's another $1b or so of expenses.

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9) So put it all together and you get.... ....well, you know, $6b or so. I'm gonna be honest, I wasn't expecting that, at all.

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10) Now I ignored some coins from the calculation, intentionally; and I ignored the opportunity cost of peoples' time. But, like, ok, so I'm still surprised. I thought food tokens were obviously a bubble. Now I'm not so sure.

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11) This is also obviously ignoring the difference between different coins. Some have obvious utility!

@compoundfinance

,

,

, etc. are important products people use even ignoring farming;

@CreamdotFinance

,

, etc. are forks on useful products.

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12)

is a weird case -- right now it's mostly just about farming, but it's also the king of farming, the meta-farming coin, and so it kinda makes sense that it should get a decent piece of that pie.

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13) So, TL;DR: obviously food tokens are a ridiculous bubble, it was clear to me from the beginning. But also maybe it's not and maybe I was wrong about that?

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14) Obviously some will still crash, and some will founder, and some will fuck up magnificently, but if even a few get to where they're trying to go, that could make up for the rest.

1:30 PM · Sep 13, 2020Twitter Web App

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KIRBY IRBY RBY BY ..... Y T Y CT Y ECT Y JECT Y OJECT Y ROJECT Y PROJECT Y

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broken arrows Jimmy

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and

Any unregulated markets will attract bad actors that try to game the system though perceived legitimacy. Only time will tell which separates the projects that provide real value or the fake ones that only exist to scam money from the public.

ディジェン

Degenerate Finance

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based and redpilled, Sushi Sam🍣

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When sir going to concentrate on FTT and SRM?

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Christopher C-Dub Wheeler

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unroll

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Hello, the unroll you asked for:

: threadreaderapp.com/thread/1305136 Have a good day. 🤖

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Thread by @SBF_FTX on Thread Reader App

@SBF_Alameda: 1) Is yield farming sustainable? Is it stupid? Is it revolutionary? 2) This is *not* trying to answer the question of whether food tokens will go up or down short-term. It's trying...

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sir when FOOD index perps sir?

@mushab43022160

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You made money off the apes the past few years and overperformed the market. Now it's time for the apes to outperform.

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please unroll

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Thread Reader Unroll Helper

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Hi! the unroll you asked for:

: threadreaderapp.com/thread/1305136 Enjoy :) 🤖

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Thread by @SBF_FTX on Thread Reader App

@SBF_Alameda: 1) Is yield farming sustainable? Is it stupid? Is it revolutionary? 2) This is *not* trying to answer the question of whether food tokens will go up or down short-term. It's trying...

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