The Fed increased the interest rates yesterday by .25%. This is the first one in more than 3 years, and there are six more planned. The Fed's attempting a delicate balance: how do they curb inflation without scaring off the markets and causing a recession?
The markets seem to be reacting to the news well. Going through with this gives investors more certainty. And .25% and additional hikes aren't enough to curb inflation. The fed might be thinking that some of the inflation is caused by supply chain issues which should sort themselves out in theory.
Today I'll be talking about:
- Ethereum's Merge. Ethereum's transition to Proof of Stake is happening!
- Anchor is on AVAX. Bringing those sweet 19.5% APY everywhere.
- Sifu's Vision. The controversial co-founder of Wonderland is back?
- Selling your Bluechips? What's a bluechip in Crypto and when should you sell?
Let's dive in!
What's Happening in DeFi
Ethereum's Merge is Working!
We've been hearing about Ethereum's merge to Proof of Stake for ages. What's taking so long? It's freaking hard.
There are billions of dollars on the line with a working product. They've described it as trying to upgrade a plane's parts while it's flying in the air.
Some good news - they've hit a huge milestone this week.
Basically, it works. It's on the Kiln testnet - this is the final public testnet before it goes live to everyone later this year.
This is great news even if you're not into Ethereum. Why? Because if ETH messed up the merge, it would be catastrophic for the rest of the industry.
Read More: Announcing the Kiln Merge Testnet
Anchor Protocol on AVAX
Anchor Protocol is the backbone of Terra Luna. You can earn 19.5% APY on UST and get paid in UST.
Anchor protocol has arrived to Avalanche.
It's already live. Go to Anchor Protocol. At the top right you can switch chains to AVAX, and connect with Metamask.
Now that it's live on AVAX, we could see it expanding soon to other chains such as FTM, Polygon, and more.
I'm anticipating that they'll be adding the sAVAX as a collateral option to borrow $UST in the upcoming months.
Risks: This is powered by the wormhole bridge. If you don't remember, hackers exploited the Wormhole bridge a few weeks ago for $326m. They did patch it, and the $326m was compensated by Jump Crypto.
Sifu Launches a New Coin
Sifu, the controversial co-founder of Wonderland, has returned with a new protocol.
It's called Sifu Vision and it looks to be a "Farming as a Service" play. Sifu yield farms the treasury, and people will be able to claim profits on a quarterly basis via ETH.
He did an interview /w The Defiant
Sifu did grow the treasury while he was in charge at Wonderland. But he also has a history of scamming and fraud.
If you want someone to manage your funds, I suggest looking at farming as a service. There are several options that are far more transparent.
Most people suck at yield farming. What if you could outsource your yield farming to a team of professionals? That's what "Farming as a Service" aims to do. Here's a breakdown of what FAAS is and how it works:
March 1st 2022
Ask Edge: On Selling Bluechips
"You refer to ETH and BTC as blue-chip stocks. That means they will basically always perform well. Most of my portfolio is in those. Should I never sell these? Not even to buy some other crypto that can perform better?"
First, let's define what a blue chip is in the stock market. They are huge companies with great reputations. They've been around for a long time and are considered household names.
Examples include IBM, Coca-cola, Microsoft, and Google.
What are blue-chips in Crypto? First, there are no official criteria right now for blue chips. It's based on opinion.
My definition: A crypto protocol that is within the top 15 by market cap. It has survived several bear cycles and is on the upswing. A year from now will it still be in the top 15?
So for me, these include Bitcoin, Ethereum, BNB, Terra, Avalanche.
You could include XRP, Solana, Polkadot, and Cardano if you want. I don't because I see their market-cap getting lower and lower.
Others would say only BTC and Ethereum are blue chips. Some would add CURVE as a bluechip. Once again, bluechip is a subjective term. Figure out what your criteria are.
Background: I sold a lot of my bluechips in 2017 to chase after alt coins. And most of those altcoins didn't survive Crypto winter. When I came back to Crypto in late 2020, I found a large bag of BTC / ETH that I never sold. Based on my experience, I'm hesitant to ever sell my blue chips.
I don't see USD at the profit.
I see bluechips at the profit.
They're my end game.
(Keep in mind everyone's in a different financial situation. I've done well financially and I live a frugal life. So I don't need to cash out my crypto)
My personal strategy is to divide my portfolio between investments and trades.
Investments = I hold onto these for several years. Blue chips fall into this category.
Trades = I hold onto these for the short term. I rotate them based on narratives and trends. I take my trading profit and trade them into blue chips.
The most important thing is to figure out your ideal portfolio allocation, and then work from there.
Le's say your goal is 50% bluechips and 50% short term trades. Well if you're 100% bluechips then it's fine to sell.
Also, you can always keep your bluechips, and add in more FIAT to trade with.
If you're asking this question, you probably should keep your blue chips. This is NOT the environment to trade-in. Now is the time to survive...not try to profit.
Tweets of the Week
Crypto Scammers stole $14 billion from people last year. Follow this checklist to protect you and your funds:
March 16th 2022
I wrote a thread on Crypto security. It covers my favorite hardware wallets, how to protect your seed phrases, secure your computer, and a list of common scams.
It's a must-read if you're new to the space.
It’s not often I come across content that leaves a lasting impact on me & drastically changes my perception of the crypto space, but when I do, I make sure to take note Here’s a list of articles, videos, & podcasts that have had a profound impact on me during my time in crypto
March 12th 2022
A list of high-impact crypto content. I recommend that you read and watch everything listed.