Introduction
In the world of finance, a revolution is taking place through decentralized finance (DeFi). While many associate cryptocurrencies with meme coins and NFTs, the real action lies in the protocols and tokens that are advancing the financial landscape. One of the most vocal supporters of DeFi is CryptoPM, and in this blog post, we'll dive into their insights on the DeFi pump and the next big thing in the industry.
Uniswap and the Rise of DeFi 1.0
CryptoPM has been ahead of the curve when it comes to DeFi. Back in January 2020, they recognized the potential of Uniswap, a tokenless DeFi protocol that operates solely on smart contracts. They understood that the only way to invest in Uniswap was by using it, and their prediction proved right when Uniswap rewarded its users with a massive airdrop later that year. Since then, Uniswap has become a critical building block of DeFi, along with other protocols like Synthetics, Compound, and Aave.
The Bullish Rise of DeFi 1.0
Recently, DeFi 1.0 protocols have been experiencing significant price movements. Uniswap, Synthetics, Compound, and Aave have all seen substantial pumps, with price increases ranging from 28% to 112% in less than a month. These bullish movements indicate something special is happening within the DeFi sector, as real protocols that are revolutionizing finance gain traction.
Understanding the DeFi Money Flow
To grasp the potential of the upcoming DeFi pump, it's essential to understand the money flow within the cryptocurrency market. Traditionally, money flows from fiat or stablecoins into Bitcoin, then into large-cap cryptocurrencies like Ethereum, and finally into mid and low-cap tokens before returning to Bitcoin or fiat. In the DeFi world, money skips Bitcoin and flows directly into Ethereum. From there, it moves into DeFi 1.0 protocols like Uniswap, Synthetics, Compound, and Aave.
The Next Wave: DeFi 2.0
After the success of DeFi 1.0, the focus now shifts to DeFi 2.0 protocols. CryptoPM believes that the next big pump will come from these next-generation DeFi projects. One protocol they highlight is GMX, a decentralized perpetual exchange built on Ethereum's Layer 2 solution Arbitrum and the Avalanche chain. GMX allows users to go long or short with up to 50x leverage without relying on a centralized source. Additionally, GMX has a unique feature where trading fees go directly to token holders, providing an attractive incentive for investors.
GMX V2 and Archie Finance
GMX is set to release its version 2, which will include synthetics, enabling trading of any asset on the platform. This expansion has led to the emergence of Archie Finance, a leveraged yield farming protocol integrated with GMX. Archie Finance allows users to boost their APYs through leverage, providing both passive income and higher rewards for those willing to take on active risk management. With the synergy between GMX and Archie Finance, the potential for growth and profitability is significant.
Conclusion
The world of DeFi is on the verge of another pump, and this time it's the DeFi 2.0 protocols that are set to thrive. CryptoPM's insights and predictions have been accurate in the past, and their enthusiasm for GMX and Archie Finance indicates the potential for substantial gains. As we witness the evolution of decentralized finance, it's crucial to stay informed about the latest developments and identify promising opportunities.
