Sometimes we also do things that progress humanity towards the better future and interest-bearing cash is one of those things.
1/ Welcome to #DeFi Wednesday.
Let's talk about how interest-bearing cash on a blockchain is going to revolutionise boring corporate treasury management that concerns every company is is a larger business than all crypto trading in the world.
Enter the thread
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Sometimes we also do things that progress humanity towards the better future and interest-bearing cash is one of those things.
My incomplete theory of interest-bearing cash is also available also as a blog post:
https://t.co/uiG0fZiVyu
It is 15 pages. Pick your slow poison or die fast by continue reading here.
Interest-bearing cash ticks up dollar (euro) balance real-time in your wallet.
Here is a demonstration using @aaveaave aDAI, based on @makerdao DAI, and @TrustWalletApp
Treasury managers no longer need to move money between the portfolio accounts and cash in hand.
More about asset and other inflations in this newsletter from @LynAldenContact "Defining inflation"
https://t.co/FaDhO9hTYZ
Why this innovation could not have happened before? How interest-bearing cash is related to cryptocurrencies, but not being a cryptocurrency itself? What is the history that brought us here.
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Money and securities (equities, bonds) and then non-liquid assets like real estate and your art collection.
Here is a full picture.
You cannot "send stocks and shares on PayPal"
Whereas stocks and bonds are "registered" held on a broker and you pay your broker (and 100s of other middlemen) for this fantastic service.
Most of money is on registered bank accounts. Bearer bonds are a thing, because registered bonds are too expensive and investors prefer the freedom they give.
https://t.co/wW6nqjTZN0
For both online bank accounts and online broker accounts computers the same thing: when you buy something in a transaction computer debits one account and credits another.
Computer does not care.
https://t.co/WSSLEV9o0Q
There are still ways to get profit margins out of them. You can e.g. trade the negative yield bond with "roll downs" for profit.
https://t.co/nJGVHG1rnc
- An account in a bank is not good store of value
- Having assets in a bank poses a counterparty risk
- Bonds are already used as MoE a SoV in large transactions
- Computers do not care what you use for a payment
Let's look at the example running on @aaveaave protocol
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Unfortunately, #Bitcoin and other cryptocurrencies proved too volatile to be used as a medium of exchange. The coffee shop small business owner is in troubles if his December revenue received -33% haircut.
Although Aave supports interest-bearing aTokens for every possible token, US dollar-based markets are the most popular ones.
Here is an example using tokenised GUSD dollar from @Gemini exchange, from @tyler and @cameron Winklewoss fame.
Here is @aaveaave aDAI balance ticking up real-time in @trustwallet
(Animation sped up for the effect)
https://t.co/SSPFd746Fy
"Ethereum of course!" would be a nice shilly answer, but there is more into it.
Here is a breakdown of the last 7 years of blockchain development.
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You need to have something pegged to USD or EUR to call it stable.
Smart contracts enable non-custodial, counterparty risk-free transactions, like ones with a lending pool.
No bank manager can mismanage your funds.
It is almost zero cost for third parties to integrate with.
Whereas Visa/Mastercard, etc. are behind proprietary protocols where you pay up just to read the documentation.
#DeFi protocols, in development since 2017, demand in stablecoin borrowing started 2020: reached a maturity level they really took off.
https://t.co/QJNzRKYzCN
5% - 15% interest is in a range of a Western credit card or developing nation business loan.
I am happy to see @NEARProtocol and @ElrondNetwork doing excellent work here.
Cryptocurrency, most prevalent collateral in lending pools, crashed down billions of dollars in value.
MakerDAO took $4M haircut, but it is peanuts compared to the total value of DeFi lending pools.
https://t.co/jHNUMhDt8f
- Positions are always collateralised
- Asset baskets are 100% transparent
- No insider fraud
- No credit card
What if smart contracts have bugs in them?
However this risk is a fixed cost and relative to the size of Assets Under Management (AUM)
Wall Street and London City traders complain they cannot do 100x kek kek.
CFOs to adjust the treasury risk/reward ratio based on their corporate needs. Underlying positions are automatically updated.
The whole banking machinery can be replaced by a smart contract having money inflows, outflows and risk parameters.
More from Crypto
1/ A thread on Nexgen’s Arrow & the #uranium cycle ($NXE)
2/ Given the scale and cost structure of Arrow, it makes sense that investors are intensely focused on its delivery timeline. This thread will discuss possible timelines, current market expectations (i.e., what’s “priced in”) & how different Arrow scenarios will impact the mkt.
3/ As you can see from the litany of responses to Michael’s tweet, there is great skepticism in the market regarding Arrow’s timeline. This is largely due to a bearish narrative conveyed by competing CEO’s whose assets only hold value if Arrow is substantially delayed.
4/ Those who played “King of the Hill” as a child would remember that it is the person at the top who is constantly attacked, not the kid sitting at the bottom of the hill in the mud. No one cares enough about that kid to attack them. This is a good parable for $NXE & Uranium.
5/ First a quick note on “this cycle” – Segra generally defines this cycle as the deficits forecasted from the mid-2020s to late-2030s. When people imply an asset producing in the mid-to-late 2020s will “miss the cycle”, they clearly have not done any real S/D modelling.
Can anyone tell me an estimated time frame that Nexgen could be permitted, start building their mine and be producing #uranium ??? @quakes99 @JekyllCapital @travmcph @NexGenEnergy $nxe
— Michael Pierce (@Big_U_Dawg) January 22, 2021
2/ Given the scale and cost structure of Arrow, it makes sense that investors are intensely focused on its delivery timeline. This thread will discuss possible timelines, current market expectations (i.e., what’s “priced in”) & how different Arrow scenarios will impact the mkt.
3/ As you can see from the litany of responses to Michael’s tweet, there is great skepticism in the market regarding Arrow’s timeline. This is largely due to a bearish narrative conveyed by competing CEO’s whose assets only hold value if Arrow is substantially delayed.
4/ Those who played “King of the Hill” as a child would remember that it is the person at the top who is constantly attacked, not the kid sitting at the bottom of the hill in the mud. No one cares enough about that kid to attack them. This is a good parable for $NXE & Uranium.
5/ First a quick note on “this cycle” – Segra generally defines this cycle as the deficits forecasted from the mid-2020s to late-2030s. When people imply an asset producing in the mid-to-late 2020s will “miss the cycle”, they clearly have not done any real S/D modelling.
You may be wondering why @bristoliver rather cryptically RT’d a chart that I posted last night. The answer is not just that he loves quadratic fits on log axes, but that this chart may –and I stress may– hint at a vaccine effect amongst the over 80s THREAD
WARNING: this is a long thread, and it’s a bit of a roller-coaster. We find some apparently strong patterns in the data, and then start to unpick them a bit. So if you start getting excited half way through you might find you’re less excited at the end. But we’ll see…
First we first have to go back a bit. @bristoliver posted a thread a few days ago explaining why, with a constant vaccination rate, a log plot of cases should show a quadratic form. In other words, it should fit an equation like: a + b.x + c.x^2
I meant to link in the model thread there - here it is
the quadratic coefficient – the ‘c’ in that equation – gives an estimate of the % of the population who are being newly protected by the vaccine each day. Please note ‘protected by the vaccine’, not ‘vaccinated’ – as we don't expect 100% protection after the first dose
ok, I lied. but strictly it's not a new graph, just a new trendline (now a quadratic on the log plot). looks um... quite a good fit. so I'd say that was interesting. pic.twitter.com/qkgyMf1ya8
— James Ward (@JamesWard73) January 27, 2021
WARNING: this is a long thread, and it’s a bit of a roller-coaster. We find some apparently strong patterns in the data, and then start to unpick them a bit. So if you start getting excited half way through you might find you’re less excited at the end. But we’ll see…
First we first have to go back a bit. @bristoliver posted a thread a few days ago explaining why, with a constant vaccination rate, a log plot of cases should show a quadratic form. In other words, it should fit an equation like: a + b.x + c.x^2
I meant to link in the model thread there - here it is
Been thinking about where we are, where we might be going, what effect vaccines might have and how to tell. This thread may not happen all at once, and will get a bit mathematical in a couple of places (sorry!), but I will put in pictures. It's yet another argument for log scales
— Oliver Johnson (@BristOliver) January 24, 2021
the quadratic coefficient – the ‘c’ in that equation – gives an estimate of the % of the population who are being newly protected by the vaccine each day. Please note ‘protected by the vaccine’, not ‘vaccinated’ – as we don't expect 100% protection after the first dose
