Text | Edited by Nancy | Produced by Tong | PANews
Text | Edited by Nancy | Produced by Tong | PANews
DeFi is full of drama.
In the wave of DeFi in the past few months, hundreds of times and thousands of times of farming income can be seen everywhere. "Farmers" have started the mode of "grabbing seeds and harvesting" day and night, and stories of getting rich by relying on DeFi continue to spread in the market. However, incidents such as the prevalence of counterfeiting and thunderstorms caused the total lock-up volume, total market value, and annualized income of the DeFi protocol to decline. DeFi is in a stage of failure.
Can Uniswap's currency issuance plan regain the lost ground and regain the DEX throne? At this stage, the liquidity mining model has reached the end of its strength, can Uniswap open up the imagination again?
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Liquidity sucked? Uniswap "issuing coins" full of blood resurrection
At the beginning of DeFi's popularity, Uniswap, Balancer, and Curve are the three carriages of DEX (decentralized exchange). However, with the gradual expansion and development of DeFi, there are more and more DEXs optimized for the leader Uniswap, and SushiSwap and other imitators are one of them.
It’s just that no one could have imagined that this DEX, which continues the core design of Uniswap and only adds token economic incentives, will become a blockbuster when it was just fledgling. Just a few days after its launch, SushiSwap has achieved a 5-fold increase in liquidity, taking away 80% of Uniswap's traffic, and launched three major exchanges within a day, becoming the protagonist of the DEX story in one fell swoop.
For a while, calls for "Uniswap to issue currency" were heard endlessly. For Uniswap, its position is precarious, because SushiSwap and other imitators are scrambling to grab its market share. Interestingly, Uniswap seems to be aware of this too. A picture shared by its founder Hayden Adams very vividly hints at the situation of being hunted as a unicorn.
After long-awaited calls, Uniswap, which has been talked about for a long time, finally issued coins yesterday. According to the official website, the initial supply of UNI is 1 billion tokens. Among them, 60% will be allocated to Uniswap community members, 21.51% will be allocated to team members, 17.80% will be allocated to investors, and 0.69% will be allocated to advisors.
As soon as the news came out, UNI was quickly "arranged" to be listed by Coinbase, as well as centralized exchanges such as Binance, Huobi, and OKEx within a few hours. At the same time, DEX competitors such as Sushiswap and 1inch are also online. And this situation was unique before. In order to attract users to trade on their own platforms, major exchanges have also adopted different levels of preferential activities. For example, Huobi has adopted the activity of free USDT equivalent point card for recharging over 400 UNI, and OKEx has implemented a 0 fee discount.
Under the market frenzy, Uniswap's lock-up value continued to rise, and its liquidity pool climbed to US$1.56 billion, an increase of 62% over the previous 24 hours. At the same time, the price of UNI also began to rise sharply. The current quotation is $5.08, a 24-hour increase of 70%.
And Uniswap's Jedi counterattack made it regain a lot of "lost ground". And imitators such as Sushiswap have also suffered from various scandals. Take SushiSwap as an example, today's SushiSwap is facing the test of life and death. Prior to this, its founder, Chef Nomi, cashed out 18,000 ETH, and there were multiple security vulnerabilities in the smart contract, which caused the price of SUSHI to plummet continuously, and the lock-up volume also continued to decline. According to data from CoinGecko, the current price of SUSHI is $1.73, a drop of 65.2% in the past half month. Once abandoned by the community, will SushiSwap have other outlets?
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"Money is not earned, it is brought by the wind."
The Uniswap coin issuance plan came earlier than expected.
In previous conjectures, the outside world agreed that VC will be the biggest winner of the meat-eating, but Uniswap can always bring "surprises", and it dedicated UNI, the fruit of the harvest, to community members with both hands. If this news is enough to make many community members ecstatic, then the airdrop of tokens worth nearly 5 billion RMB (note: calculated based on the current price of 5.08 RMB) has shocked people inside and outside the circle even more. In Uniswap’s airdrop plan, 4.92% of the 150 million tokens will be allocated to 49,192 early LPs (liquidity providers), 10.06% will be allocated to 250,000 early participating users, and the remaining 0.02% will be allocated to 220 SOCKS (Uniswap official surrounding digital socks) holders. The official pointed out that every address that has called Uniswap V1 or V2 contracts can apply for 400 UNI, including 12,000 addresses that have failed to call. That is to say, no matter whether the transaction is successful or not, participants can get nearly 14,000 RMB in benefits, and SOCKS holders can receive up to 5,000 US dollars in rewards.
According to Ethercan.io, the address that received the most airdrops this time received 1.15 million UNIs, and the second place received about 910,000 UNIs. At the same time, data from Dune Analytics shows that as of now, nearly 143,000 addresses have claimed 89.679 million UNI airdrops, but more than 60 million UNIs have not yet been claimed.
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Source: Uniswap
Source: Uniswap
However, the behind-the-scenes winners of this wave of welfare are still deeply involved scientists and big households. In addition to taking away the high income from farming, they also took away the most "wool". For example, players who issue counterfeit coins on Uniswap may earn a lot of money in counterfeit coins, but after creating hundreds of wallets, they actually rely on UNI airdrops to squeeze their wool; The big players got more than 18,000 UNI, worth 90,000 US dollars.
It can be said that this is the most powerful day since the birth of Uniswap.
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Liquidity mining "heart failure"? Is Uniswap sustainable?
The popular liquidity mining model once brought the DeFi gluttonous feast. The liquidity mining model has even become the "standard configuration" of the DeFi protocol. But William believes that liquidity mining is like a shot in the arm, helping DeFi achieve unexpected success this summer. The key is that the tokens mined in the primary market can be sold and realized in the secondary market. The secondary market has now become a silly game of "playing the drum and passing the flower". The reason why everyone is willing to pay a high price regardless of the real value of the DeFi currency is because they expect a bigger fool to pay a higher price. Buy it from them. However, too much cardiotonic injection will eventually lead to "heart failure".
Nevertheless, Uniswap still started liquidity mining. This morning, Uniswap has started a two-month initial liquidity mining plan, which will last until 12:00 am UTC on November 17, 2020. The four liquidity mining pools opened by Uniswap are: ETH/USDT, ETH/USDC, ETH/DAI, and ETH/WBTC. Each liquidity mining pool can receive 83,300 UNI rewards per day, and each block Each pool can get 54 UNI rewards, and the total reward pool is 500,000 UNIs, and these UNIs do not need to be locked.
"In the short term, it will definitely boost Uniswap's trading volume and liquidity; but in the long run, if you rely too much on UNI's liquidity mining, it will bring huge side effects: if the price of tokens in the secondary market collapses in the future , then the 'dig-raise-sell' system of farmers participating in 'liquid mining' will collapse, followed by the departure of a large number of 'farmers', which will cause a major blow to the project." William told PANews .
At the same time, William believes that the game of "liquidity mining" is approaching the point. Instead of relying on UNI to maintain the prosperity of Uniswap, it is better to pay more attention to the application value of Uniswap itself. Uniswap is a typical representative of the automatic market maker system (AMM), and AMM represents a direction for the future reform of the financial trading system; if Uniswap can further promote the innovation and improvement of AMM in the future (such as reducing impermanent losses, etc.), then Uniswap Will usher in greater glory.
In addition, it is worth mentioning that although the concept of community-driven governance is not new, it is being emphasized more and more. Uniswap officials pointed out that the team will continue to not participate in v2 protocol development, audits and other matters. Likewise, team members will not directly participate in governance for the foreseeable future, although they can delegate voting rights to protocol representatives without attempting to influence their voting decisions.
Before this, the concept of governance has not been well practiced. For example, Bitcoin has a power struggle due to different ideas. In the DeFi protocol, DeFi projects have done a lot of in-depth discussions and practices on the decentralization of governance. Perhaps, driven by high-quality projects such as Uniswap, more innovative governance methods will continue to emerge.
