2020 DeFi Trend
As we all know, 2020 is the year for “DeFi” (Decentralized Finance). As of August 1st, the total market value of DeFi tokens hit a record-high of $7.3 billion. Within just a few months since March, top DeFi tokens have gained multiple returns. Example, Ampleforth token went from $0.50 to $3.7, 0x Protocol market cap went from $100M to $300M, and Aave marketcap went from $20M to astonishing highs of $400M.
And so the question is, “Are we in a DeFi bubble?”. Personally, I don’t think so. The $7.3B market cap of DeFi is just a drop in a bucket compared to what the FED are printing each week. The DeFi gains that we are seeing now could just be the start of a huge crypto bull run that is about to happen. Can you remember how the ICO’s started the whole bubble back in 2017? Before that bubble pop, ETH went from the lows of $10 to $1000. And so I personally believe DeFi tokens in Ethereum blockchain is still now in its early trend. Certainly, there is a huge opportunity of having multiple returns if you HODL the right DeFi token this year.
A Potential DeFi Token You Haven’t Heard Before
Statera Project is a smart contract that coordinates with a trustless and community driven portfolio of top cryptocurrencies. Every trade for Statera creates an arbitrage opportunity. Trading attracts liquidity, which in-turn attracts trading. In each transaction, Statera project’s algorithm will destroy 1% of the amount transacted. Thereby making Statera a deflationary token. As Statera token decreases over time, this gives incentive to long term HODLERS for potential price appreciation.
Real-World Use Case
Ever heard of an Index Fund? Well that is one of the real world application that Statera Project is trying to innovate. The Index fund market are worth TRILLIONS of dollars. If they are able to win the race, this could be a HUGE win for the Statera team and its early believers.
In their website, we can see that they have 2 options for an Index fund. #1 is Statera Phoenix Fund which holds 5 cryptocurrencies, Delta (Statera/Etherum), Ethereum, Bitcoin, Chainlink, and Synthetix in the ratio of 40/30/10/10/10. And #2 is Delta Token Fund which holds only 2 cryptocurrencies, Statera and Ethereum. It is made up of 50/50 ETH and Statera token. This could open up the door for both “BABY BOOMERS” and “Gen X” to easily invest in cryptocurrencies which some would otherwise hesitate due to technical difficulties.
But most of the cryptocurrencies had depreciated in value the past few years. So how can we be sure that the Statera Index Fund will go up in value? The answer is in their Delta token fund. With Statera’s Delta Token Fund, you’re like having a real estate property that continually pays you a monthly rent which translates into daily crypto dividends into your account. And this fees compound daily which would result into astronomical annual returns! Based on Statera’s data for the month of June, if Delta token returns for the past few months stayed in value for just a year, it could potentially bring over 900% to 400,000% annual percentage yield. This would translate into your $1000 invested could potentially bring $9000 to $400,000 in profits!
This returns is possible due to the fees that the Delta Token Index Fund holders get from Uniswap Liquidity Pool. As a Delta Token Index Fund holder, your invested funds will be used to provide liquidity for trades on the exchange side of Uniswap. Each time a liquidity is provided in a trade, you get paid a fee or just like a dividend. As the value of ETH and Statera tokens go up, the fees you receive also goes up. And this fees could be reinvested back into the funds thereby daily compounding your profits till it reach the potential astronomical returns mentioned in the data.
THE MILLION-DOLLAR QUESTION: Is Statera Project The Next Huge DeFi?
What the Statera Team is doing is very unique and we are still in the very early stages of the DeFi technology. Very few projects are still trying to accomplish the task and 5 years from now, we never know yet who comes up on top. However, Statera Project is one that is worth keeping an eye on. They are the ONLY ones that are starting a revolution on creating a new asset class in the crypto industry: “Deflationary Index Funds”. And we never know if this thing could take off, this rocket ship could potentially bring you to the moon.
Other DeFi projects like Statera is already priced in over $50M - $300M+ market cap. However, Statera token only has a limited supply of 101M coins which 13M+ coins of it has already been burned. And this supply will continue to deflate over time. At today’s price it only has a market cap of less than $6 million which is ultra micro if we compare it with other DeFi projects that are trying to solve the same problems the Statera team is solving.
Statera is the first “Deflationary Liquidity Pool Provider” in the crypto and DeFi ecosystem. As what the saying says “The Fortune Favors The Bold”. Although this technology have not been tried yet before, if this thing gains momentum then Statera Project will surely take the lead in this space. And with the low market cap Statera has now, this token will certainly reward the early believers because 10X of dollar amount invested is very possible from here. But of course, with every investment, the utmost important is to look at it from risk-first perspective. Personally, I would think that if ever I will invest personal money in this project, I would want to participate in the Delta Token Index Fund so that I could collect the dividend fees. As the project is still fairly new, the failure probability is high. Because 90% of new businesses fail. However, I’m overall BULLISH in the crypto industry. And so if I get the invested amount in dividend fees, I would take the initial capital out for capital preservation. Then HODL the FREE Statera tokens for potential 10X – 100X returns.
What are your thoughts? Is Statera tokens worth investing?
Disclaimer: This is my personal reflection and I am not a financial advisor. I am not responsible for any action taken as a result of this post. My post can only be a reference for your further research and growth. This blog post is in participation of #MyStateraProject Writing Contest and Giveaway.