Volatility, Profits, Near, Polka Dot and DAOs!

The Big Recap by Lark

The crypto markets are tanking again. Am I surprised? No. As I mentioned in my video this week I was looking for more downside. There is still a lot of fear in the market. The news today that the FED will be hiking rates in March seems to have given the market a reason to be spooked again.  While it is probably not what you want to hear right now, the reality is that adverse market conditions like these (and worse) are how the big gains are made in this market. Buying tops is not how gains are made. 

Now I know what you may be thinking, who still has money to buy the dips? Well, investors who took profits and used those profits to create passive income. 

So, today I wanted to talk to you once again about the most important topic in crypto. Taking profits. The reason most investors don’t do well is because they never click sell on those speculative positions. You need to remove your emotion when it comes to your investments. Anytime I post that I have sold some or all of a crypto online I am attacked by bag holders… I mean the community. Ask yourself one simple question, do you want to be part of a “community”, or do you want to make intergenerational wealth for you and your family? Because you often can’t do both. Am I saying that you need to exit 100% of a position? No. By all means keep a moon bag. Am I saying not to buy Bitcoin? No. By all means, buy BTC using altcoin profits. Am I saying to put all of the money back into your bank account. No. You can get stablecoins and farm and or lend for great rates to earn a passive income. Am I saying that now is the perfect time to take profits? No, far from it. Not on most coins, but I find that this topic is a key one to long term success and thus we should remind ourselves of it frequently. Now I know what you might be thinking, but but but Lark, surely all of my coins will do a million X more in gains!!!! Maybe… maybe not. But a lot of you will be sitting on massive gains already, and if you are not yet then one day you will. So many people get obsessed with perfectly timing the top or waiting for another few percent in gains that they force themselves into a situation of inaction and never click sell. It is not about perfectly catching the top, it is about catching the meat of the move. Just some food for thought for you. I am a long term investor in this market, and some positions I am ready to hold for a long time, but I am never afraid to take profits and cash out some or even all of a position. It is important not to lose touch with reality when it comes to crypto. If most of your wealth is sitting in jpegs, dog coins, or some kind of speculative altcoins then you may really want to ask yourself that ever important question “should I take profits?”. Don’t let your ego get in the way of getting rich and securing financial freedom. Remember this conversation the next time the market is pumping.

Bored Apes going crazy! More big celebs bought apes this week including Dave Chappelle, Eminem, and Britney Spears. Also the Bored Ape Mutant series is seeing a massive price revival with Mega Mutant Serums selling for millions of dollars. Is this the start of a new NFT wave? Maybe. I think that NFTs will have a great year in 2022, and yes some collections will massively outperform others. There will also be loads of scamming and fraud. I really like NFTs, but I don’t personally really go in for NFT flipping. I buy NFTs I like, because I like them, for the most part anyway. That being said, if you are an NFT lover then there will for sure be a lot of money to be made in NFTs in 2022. Which is exactly why we do a weekly segment on NFTs. While major Ethereum collections continue to be hitting crazy valuations, NFTs on other chains will probably offer the biggest opportunities although right now Ethereum is capturing around 90% of all NFT volume. 

The NEAR blockchain has been getting a lot of attention recently. If you remember I talked about near back in October around $8 per coin saying that their ecosystem fund of 800 million dollars could serve as a big catalyst for the blockchain. One thing’s for certain though, the market is seeking out alternatives to Ethereum. Yes, we already have Solana, Avalanche, and BSC, but you also must understand just how early it is for some of these coins. The winners are far from being set in stone at this point. And NEAR with its hot tech features like Ethereum compatibility, bridge, sharding, and IBC compatibility it is well positioned to pick up users. Personally I will be watching for hot farming opportunities on NEAR not buying the token which is already in the top 30. Meanwhile in Ethereum land I just paid $180 to use Uniswap, lol. 

Parachain auction round two for Polka Dot has already kicked off with Efinity securing the 6th slot. But who are the other competitors? 

Composable Finance is the leader for the 7th place. It is a crosschain bridge with big ambitions and backed by big names like Polygon and CMS.

Centrifuge is currently in 8th place. It is a gateway for real world assets to come on chain. Backed by Galaxy Digital.

Interlay is currently in 9th place. It is network focused on bringing cross chain assets like Bitcoin into the Polka Dot ecosystem. Not as many household name backers, but good partners like Moonbeam and Acala. 

Equilibrium is coming in at number 10. It is something of a one stop defi shop for the Polka Dot ecosystem. 

You can see contestants out of the top 10 HERE. Also do note that while these are the current top 10 we could always see someone like Litentry or Darwinia jump in the rankings in the weeks ahead.

As previously mentioned you can either contribute to the auctions directly HERE or via Parallel Finance to get extra rewards HERE or via exchanges like Kraken. 

Personally I backed Efinity in this round, and I am now out of DOT and have no plans to invest more in DOT parachains. 

Defi updates 

  • Avalanche’s Trader Joe has some nice rates on more exotic pairs like EGG/AVAX HERE
  • Yearn Finance has some great rates on forex with Korean Won and Euros both over 60%. HERE
  • Not really defi news, but something to watch is Trust Swap which just acquired the Crypto App, which has 3.4 million downloads. The SWAP token will become the money of the Crypto App. IF this is done successfully then we could see a major price move this year for SWAP. 
  • It seems that Redacted Cartel will begin buying up Tokemak which could have a positive impact on the price of TOKE. Source
  • Polygon based Tetu Finance has some sweet rates for stablecoins and wrapped coins like Wrapped Bitcoin. Be aware there is no insurance option for this protocol making it higher risk. 
  • Wonderland is going to start running an Avalanche Validator and give 90% of the rewards to TIME holders. This could be a potential price catalyst for TIME. Source
  • You can now lend your Ethereum on Abracadabra for 0% interest and borrow MIM. Source

DAOs by Matt

DAOs. What’s all the fuss about?

DAOs are Decentralised Autonomous Organisations. They are entities that operate through smart contracts. Their financial transactions and rules are encoded on a blockchain, effectively controlled by the organisation’s members rather than a central governing authority. 

Membership of a DAO is typically determined by ownership of some of the DAO’s native token, which is issued on a blockchain and acts much like a digital membership card, enabling access to gated content, voting rights and other benefits.

Why are DAOs Important? 

Starting an organisation requires considerable trust in the people that you are working with and it’s very hard to trust others that you’ve only ever interacted with on the internet. With DAOs you don’t need to trust anyone else in the group, just the DAO’s code, which is 100% transparent and verifiable by anyone. This opens up many new opportunities for global collaboration and coordination and gives power to communities in a number of different ways.

The DAO

In May 2016, history was made when a group of Ethereum developers deployed ‘The DAO’, aka The Genesis Dao. This was the first known DAO and the platform was designed to enable anyone with a project to pitch their idea to the community and potentially receive funding. There was a contribution period for the DAO and investors could exchange ETH for DAO tokens which would in turn enable them to vote on plans and receive rewards if the projects were successful. 

The raise was enormously successful with over 12.7 million ETH being pledged. Unfortunately, in June 2017 a hacker compromised the system and was able to drain a whopping 3.6 million ETH. However, the hack was reversed and the funds restored via a controversial hard fork of the Ethereum chain. The vast majority of miners switched to the new fork while the original chain became known as Ethereum Classic. The DAO project has since folded but remains an important reference for new DAOs that now populate the space.

Different Types of DAOs

DAOs have become a very popular vehicle for venture capital and other fundraising activities. Many DeFi and NFT projects are also governed by DAOs. 

Protocol DAOs are the most common type of DAO, and they are found behind many decentralised finance (DeFi) protocols. These DAOs are used as an ownership and governance mechanism for lending platforms, yield optimisers and more. They maintain and evolve the underlying platform in a fair and decentralised manner. Some of the leading Protocol DAOs include those behind DeFi platforms such as Uniswap, Maker and Aave

Investment DAOs are similar to traditional investment funds that operate with pooled capital. However, rather than a centralised party making the calls, Investment DAO token holders can vote on what the pool of funds is invested in. Examples include The LAO which is a global group of Ethereum enthusiasts who support new projects on the network. There is also Aladdin DAO which has an elected group of experienced DeFi yield farmers that are incentivised to earn yield for their members. 

Grant DAOs are designed to fund and foster new ventures or projects, most often within the DeFi space. These grant-focused DAOs usually arise as a philanthropic arm of larger projects within the space, but may also exist on their own. A couple of well-known examples include Gitcoin which is an individual platform that funds developers working on open-source projects and Uniswap Grants which supports the creation and growth of new projects surrounding Uniswap and the DeFi ecosystem.

Social DAOs can take the form of any social circle that shares a common interest. Members gain entry by paying a membership fee in the form of purchasing some of the DAO’s tokens or perhaps buying a certain kind of NFT. An example is the Bored Ape Yacht Club which requires ownership of a BAYC NFT. The actual DAO and governance portion of the project is in the pipeline according to their Roadmap 2.0, so what the DAO will be governing is still up in the air. We’ll just have to wait and see how things unfold with this one.

Workforce DAOs are beginning to shape the way in which we work. An example of this is the Yap DAO. This DAO offers a comprehensive range of public relations support to blockchain related entities. Members of the DAO are voted in on the basis of their skill set and the experience that they can bring to the organisation. Members of the DAO form their own working groups, prepare pitches to clients, and agree on payment terms and deliverables. 

DAOs have a genuine shot at becoming a leading coordinator of capital and culture. They could well be the future of fundraising, lay new foundations for the way that we work, and determine the way that human beings choose to organise themselves in many other areas. But despite their growing popularity, DAOs have a long way to go before reaching mainstream adoption and recognition/understanding from traditional media outlets. They may also need to overcome potential regulatory and legal challenges which could impact the way in which they are established and operate.

 

Final Notes

Thank you so much for your support, and I truly hope that today’s issue will give you insights needed to help you master your wealth.

If you are reading this it means you are on the free version of the Wealth Mastery Investor Report, which is great for news and tips on the crypto markets.

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See you next time!

Lark and the Wealth Mastery Team

 

Legal Disclaimer

TCL Publishing ltd (director Lark Davis, owner of Wealth Mastery) is not providing you individually tailored investment advice. Nor is TCL Publishing registered to provide investment advice, is not a financial adviser, and is not a broker-dealer. The material provided is for educational purposes only. TCL Publishing is not responsible for any gains or losses that result from your cryptocurrency investments. Investing in cryptocurrency involves a high degree of risk and should be considered only by persons who can afford to sustain a loss of their entire investment. Investors should consult their financial adviser before investing in cryptocurrency.

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