Five bullet Friday - issue #101

 Crypto markets seemed to have recovered a lot after bitcoin gained 28% in one week. Bitcoin's hashrate also started moving up with bitcoin miners quickly setting up mining operations in other countries. I think it was a healthy pull back to clear out weak hands.

1. Securites and Exchange Commission (SEC) has rejected over 8 different bitcoin ETFs from major institutions. All of them had very thoughtful proposals. This week, Goldman Sachs filed for a decentralized finance (DeFi) ETF with the SEC. This ETF is filled with ONLY centralized entities which have no connection whatsoever with DeFi. See the composition of the ETF. The largest component is Nokia and then we have dinosaurs like Siemens, Fujitsu and IBM. It does not even have Ethereum. To me, it looks a like a pure scam. Unfortunately, SEC will approve this right away. This shows the level of corruption in our financial markets.

2. I followed Yield Guild Guide (YGG) for a long time due to the nature of its business model. This week they launched their IDO on Sushi Swap offering 2.5% of the tokens to public in a Dutch auction. I set the alarm for 6AM in the morning and woke up to place my bid at $0.35. YGG managed to raise $12.5 million dollars in just 10 seconds with just 32 wallets. People were so desperate to get an allocation that someone paid $10,000 worth of ETH transaction fees to get in front of the ethereum miners!

3. When we first started buying OlympusDAO (OHM) token, the entire marketcap was close to $30 million. Today due to supply increase (not price increase), its market cap stands at $400 million. It is responsible for big portion of our retained earnings. We currently hold around 11,000 tokens of OHM. Pretty soon, we will be able to take our portion of DAI from OHM treasury and stake it in Yearn protocol and generate more income. OHM treasury now controls 99% of the liquidity pools.

4.  We currently hold AXS directly in our portfolio as well as a component of the index NFTP. Currently our AXS position is showing up in DeBank Portfolio page. Axie Infinity is a paradigm shift in gaming. Earlier, companies like Take Two Interactive, Electronic Arts built centralized games where they are the beneficiaries of the growth. Now, AXS has turned the profit spigot towards players instead of game developers. Now, 500,0000 people are making a very handsome living just by playing Axie. Axie is not only a competitor to the huge labor pools of Uber and Lyft and also many low-level jobs. 

5. Since I was not able to get any allocation in IDO for YGG token, I had to buy it in the secondary market at $1.42. YGG is very similar to YFI. It is a yield aggregator for NFTs. Axie Infinity is not a free-to-play game. Gamers need to buy 3 Axies  in order to play, which costs close to $1500. This is too expensive for many people in Philippines, Venezuela and Vietnam. So those skilled players, will borrow their tokens from Yield Guild and make money. These gamers will collect 70% of their earnings, while 20% goes to a community manager and 10% is accrued to YGG token. Currently YGG has 30,000 gamers generating income. I can see the potential for this to grow to even a billion people. We currently hold 73,905 tokens of YGG in our portfolio. This not reflected on Debank Portfolio.

Since the market is gathering momentum after the China scare, this is a very good time for long-term investors to enter the market. 

Have a wonderful weekend!

Sam Ikkurty