Gas Fees Are Not The Only Reason TRX Is Enjoying DeFi Adoption
Is This The Beginning of A Significant Shift?
With the launch of SUN token and other DeFi focused projects, TRX has gained a lot of favor in the DeFi space in a very short amount of time. Some very well timed moves by Sun and his team are proving to be very viable indeed. If you are not operating with thousands of dollars in the DeFi space, you are pretty much excluded by default, due to insanely high gas fees. Though gas fees have recently eased off, they remain pretty volatile and can spike at any moment.
This obviously played a massive role in TRX gaining more adoption as a DeFi alternative. Though gas fees were the original motivation for users to utilize Tron as an alternative, it is definitely not the only case for TRX to be taken more seriously in the world of DeFi.
Demand Requires Scalability
Though many would agree that ETH is definitely best suited to service the world of DeFi, many issues still plague the network and make it difficult to serve the industry at this stage. Gas fees are the main culprit when it comes to factors discouraging users from utilizing ETH for DeFi purposes but there are more.
At this stage ETH can only handle about 15 transactions per second, while TRX can perform in the region of approximately 2000 transactions per second. This is a massive variance and makes the case for TRX being a lot more scalable than ETH at this stage.
Scalability is a very important aspect to consider when it comes to utilizing DeFi protocols. Congested networks are not user friendly, or very efficient in an industry as fast and volatile as Crypto. Block times on TRX are approximately 3 seconds and make it a much more viable option as a DeFi vehicle. I have personally experienced major setbacks due to congestion on the Ethereum network and so avoid using it until these issues can be resolved.
I hold ETH in my hodl portfolio and believe that it will be a top performer in the next bull run. However, current issues regarding congestion and high gas fees are going to deter more users other than myself. Many will be looking for an alternative until certain changes take place and Tron is looking like the most likely candidate at this point.
Rumours of an early ETH 2.0 launch may be true but will ETH 2.0 offer an instant solution to the current issues plaguing the network? This all remains to be seen and until such time TRX is likely to grow in DeFi adoption.
Boom Time?
Many are expecting the NFT sector to really boom in the next couple of years and I would tend to agree. I still believe DeFi is going to have a fresh second season of growth, mostly linked to DeFi projects with multiple use cases. It is possible that this could perhaps coincide with a significant surge in the NFT space. The biggest challenge is going to be how to play the NFT market and I have an idea that may well pay off. Some may disagree due to the tokenomics of the project but I have a sneaky suspicion that in a frenzy, tokenomics will not play much of an influence but more on that later!
The NFT Rush
If Crypto Kitties is anything to go by, it is going to be extremely difficult finding collectables that are actually going to be viewed as rare and collectable. In other words, the tokens that will actually find value in the marketplace and as a result change hands with an ever increasing value. There is currently a lot of junk in the NFT marketplace and that will most likely increase in the wake of a boom!
What is being tokenized and how it holds value is a metric that still needs to be discovered and understood by many current participants in the NFT space. Tokenizing something does not guarantee value and many are still to grasp this concept.
This is why I believe one of the best strategies for NFT's is to repeat the approach of the 1925 gold rush and rather invest in the platforms that make it possible. People selling equipment and supplies in the gold rush became more wealthy than those actually mining gold.
My Strategy
I will not be buying NFT's but rather investing in projects like Rarible. I know that RARI is a governance token that currently has inflationary tokenomics but I believe that could change and even if it does not, a frenzy will not take any of that into consideration. Rarible is one of the most widely used platforms for users to create, showcase and sell their NFT's. One of the key components in the token's favor despite obvious reasons is that the market cap is pretty much nowhere, a measly $10 million.
Regardless of tokenomics, it is almost impossible for RARI to remain at these levels if NFT fever hits and Rarible is on the lips of many. Currently 75K RARI are issued every week to users of the platform. This is generally seen as negative for the price and it is, yet sometimes there are exceptions to the rule. A key example of where typical dynamics failed to play out was the recent UNI airdrop.
Every single person that had ever used Uniswap received hundreds of tokens and yet the price continued to rise in spite of obvious sell pressure. It makes sense that if you received $1000+ worth of a token for free that you would most likely sell it fast in order to realize your gains in ETH.
This is clearly not my average pick but I am looking towards alternative outcomes and a bit of a gut feeling. I guess we will see how this works out, if at all. As always, this is not investment advice, please do your own research and own your own moves.
Countries like South Africa often trend in Bitcoin metrics, Yet when it comes to the halving, it's Europe that is dominating! Switzerland takes the top spot, as it's no secret the Swiss love Crypto!
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Bitcoin recently crossed the 8K mark and simultaneously the 200 day moving average, placing BTC in bull territory once again. However a daily close above 8k is needed to solidify the case for further bullish momentum.
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Twitter analyst, Dave the Wave has called for one last retracement in the Bitcoin price. The trader believes that a final move down to the support at $6400 is still to play out. The trader and analyst also discouraged investors from waiting for the perfect buy at the bottom but rather to average in over time.
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More and more new wallets are moving into the top 10K ETH wallets. Whales are accumulating ETH at an accelerated pace, as DeFI and staking for ETH 2.0 are creating value in the asset. Over the last 6 months we have seen more inflows into ETH than we saw into BTC in 2019!
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According to the new ETH 2 rewards calculator you can earn 279% in 10 years! However, there are a number of prerequisites that have to met. The calculator reveals that the annual return is 14.26%, which is very high considering that ETH is in the top 3!
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Tone Vays recently tweeted that there is a lot of resistance in the 8K zone. He went on to say that if BTC could break past that resistance and into the 9K zone, further upside would be on the table. Tone went on to explain that such a move could validate the S2F model by Plan B!
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A very persuasive case is made by Barely Sociable in his recent video on Satoshi Nakamoto. It's very compelling and his case seems to be pretty rock solid. Has Satoshi finally been revealed?
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