Continue Capital Insights: 15 Perspectives on the Crypto Market and Project Logic

Pima, a well-known blockchain project investor, KOL, and co-founder of Continue Capital. According to public information, Pima entered the digital currency investment field in May 2013, joined the Ethereum community in 2015, and became a staunch evangelist. He has led investments in over 40 projects, including Cosmos, Qtum, Tezos, Polkadot, Iost, Zilliqa, and Quarkchain, and is the largest individual investor in OmiseGo, Zilliqa, and Polkadot in China. Chain Catcher has compiled some of Pima's views and statements from public channels such as Weibo and Twitter since the second half of 2020, hoping to help readers further understand the DeFi market in the context of the overall bull market.

Talking about Market Logic

February 5

In the past month, DeFi has been like a value discovery phenomenon, maintaining high popularity. Many people have started to pour in, and we see more distrust and bubble skepticism. It’s okay; the difference in expectations is the source of profit, and divergence is the guarantee of returns. Just like two armies facing off, we need a constant influx of new and old players switching sides.

From a personal perspective, DeFi may be the third evolution of the grand narrative logic in the Crypto field. The first was BTC bringing value storage, the second was ETH bringing Dapps, and the third is DeFi bringing valuation reconstruction. Of course, there have been other projects making great progress this year, but the main line of DeFi is like a sharp blade repeatedly impacting the industry landscape.

In every round of bull markets in the A-share market, there is always a sector that runs through the entire bull market, rising spirally from start to finish. Periodic declines are certainly normal; market capitalization can drop, but rankings cannot. Don’t say that even Top 10 projects will have fierce competition; even Top 100 projects will. Market capitalization, or price, is very instructive in various economic production fields. Price is a signal, and its greatest function is to convey information that you do not know or have misjudged. From the perspective of a rational economic person, you need to adjust your production, operation, or investment decisions based on price. Bull stocks require you to spend more time researching. What we may be participating in is not just DeFi; we are participating in an era.
December 14, 2020

Lending, trading, and stablecoins are the three fundamental businesses of DeFi. The boundaries of DeFi need to be further broken through in these three areas. Previously, I was so obsessed with Ampl that my idea was quite simple: to conduct experiments in the cryptocurrency field that would almost never be possible in real life. Many other business ideas can be mapped from traditional finance to the crypto space, but stablecoins are something we should not hope for; the cryptocurrency field is inherently the soil for such experiments.

December 2, 2020

What we care about most is sustained creativity. We try to find more opportunities from 0 to 1. From 1 to 100 is the basic return obtained by following the market, while from 0 to 1 is the source of excess returns.

November 26, 2020

Many people often act as passersby, with severe path dependence, preferring familiar projects. When new species emerge, participation is severely lacking, and only when prices rise do they experience various FOMO. DeFi is a field that emphasizes hands-on ability. Reading articles for a few days without actually operating is not enough. So a little secret to breaking path dependence is: buy a small amount. A position of one-thousandth or even one-ten-thousandth is enough to familiarize you with the entire process. Don't trust, verify.

November 26, 2020

The stock market adage says that big drops are good for stock selection. It does not mean that leading stocks should not drop; following the market and emotional releases is acceptable. It means that once the market stabilizes, there will be a strong rebound, quickly approaching new highs or even setting new highs.

Floating profits are easy to realize, but leading stocks have strong resilience, able to face the first blow of a stock market drop calmly. Every major drop is a good opportunity to clean up junk stocks and adjust to leading stocks.

November 17, 2020

What seems to be an unstable YFI team can still attract so much funding and attention. Why does the anonymous Farm's TVL catch up with or even exceed YFI, yet its valuation is still far below YFI?

The answer is: creativity and transparency. The market gives a valuation premium to creative teams, high valuations to transparent projects, and rewards originality, all of which are important components of a project's overall valuation. With a creative team, you have infinite possibilities.

November 16, 2020

I heard that experts bet on national fortunes; every time there is a setback in the process, they remind themselves, always remember that this may be a once-in-a-century opportunity caused by the pandemic. I looked at the statistics; this interest rate is not only the lowest in the U.S. in 300 years but also the lowest in human history over 5,000 years. One can only say that we are in a great era of seizing new economic assets. Even European negative interest rate government bonds can be sold, and this bizarre phenomenon will spread to varying degrees across different countries. Looking back five or ten years from now, will those participating now be the engine industry that drives the sixty-year economic cycle?

October 20, 2020

I think the term "machine gun pool" is better translated as "wealth management for clients" or "fund management," as ordinary users can understand it better, possibly due to sensitivity to wording. For asset management companies, the core is how much money users have given you and how much capital has been invested in your products. This is also why I believe that for machine gun pool projects, the AUM (Assets Under Management) metric is far better than TVL, as much of the TVL is used for token distribution.

October 4, 2020

In our industry, the cyclicality is very obvious, and the iteration speed is exceptionally rapid. Often, by the time it is perceived by outsiders, it may already be close to a peak for some time. This can make those who have not invested time and energy feel exceptionally painful: they often feel like they are drifting with the tide yet always get lost in the hotspots. In my view, hotspots are not the tracks that have risen; places with rigid demand will eventually become hotspots.

We see the highlights of aave/uni but do not notice the painful transformations and dormant periods of these projects that have gone through ups and downs. New projects and new teams will face different influencing factors, which is the touchstone for a project's resilience. It is incredibly difficult to traverse various cycles, and this is also a sign of the gradually diminishing growth dividends in the industry: becoming increasingly specialized and structured. We can feel the ferocity of the new generation while also sensing the steadiness of the previous generation. Those on the mountain should not look down on those at the foot of the mountain because one day, they will come up the mountain to replace you.

Those climbing the mountain should not look down on those descending because when they were shining, you were still wandering at the foot of the mountain. When ETH was climbing, no one could have imagined that one day it would account for half of Bitcoin's market value. If Bitcoin had not been born in 2009 but instead appeared in 2049 or 2109, would it still present itself in the same form? Or would it emerge in a completely new consensus and manner? Someone must continuously attempt and explore, as the wind rises from the end of the green plums. We must keep searching for opportunities that may bring slight changes to the industry. In a situation where sand and mud mix, do not give up tracking. The saying that big drops are good for stock selection means that while everything can drop together, when it rises, it can often be the first to emerge from the mire, and you might just dig up the next pearl. Let’s encourage each other.

September 9, 2020

Liquidity mining is just one important way of token distribution. Farmers are merely temporary holders of tokens. Ultimately, it will be returned to those who wish to understand the long-term development of the project.

Talking about Project Logic

January 16

Lend and Snx are the two most execution-oriented representative teams among the rising stars of DeFi. Unlike Comp, which was born under the halo of star teams or top investors, they have indeed done the best in community integration and product execution, bearing the responsibility of expanding the boundaries of DeFi. External water flows inward, creating a positive-sum game rather than a zero-sum game. It is not about tearing each other apart but learning from the consumption, medicine, and liquor sectors in the stock market, lifting each other up, and collectively enlarging the cake.

To briefly discuss Aave, it rose in January 2020 and upgraded the brand of Lend. By January 31, $5 million was locked in the Aave protocol, with a market cap of $30 million. From the moment it entered the DeFi field, it shocked the mainstream DeFi world with the later famous flash loans. It was not the first project to offer Flashloan (that was dYdX), but it was the first to promote flash loans on a large scale. With active new integrations, it successfully launched credit delegation, promoting the in-depth development of unsecured loans, and various internal and external tasks have since been carried out in an orderly manner.

Snx itself is a component of stablecoins, but they quickly realized that the synthetic asset model could be expanded far beyond the scope of stablecoin products. In March last year, Kain initially discussed with the community and took community opinions, rewarding those who first provided liquidity for sETH in Uniswap. Since then, Snx has become the pioneer of liquidity mining, leading DeFi development with a high-inflation stake + liquidity mining combination. Once a first-mover advantage is established, subsequent advancements in synthetic assets/trading/binary options, etc., will be smooth sailing.

When Comp's liquidity mining ignited the industry, it quickly partnered with Curve/Bal/Ren and directly launched joint mining, elevating the entire DeFi Lego gameplay to a new dimension. Even compared to Comp, it instantly regained a position, which is why I think they are truly impressive in execution and innovation. Now Snx is under various pressures, being the first to dare to launch Optimistic, exploring L2 solutions with a "who else but me" courage, focusing not only on project development but also on the industry ecosystem's advancement. Capital, in essence, is about optimizing the allocation of market resources to further improve production efficiency. When a project is small, who do you support if you do not support such enterprises?

November 29, 2020

In the financial sector, the most difficult is the insurance industry. Insurance business rarely makes profits; the real money comes from reinvestment. This is also a very important factor in why COVER needs to integrate with YFI.

October 20, 2020

BarnBridge seems to have become popular again with the growth of TVL (close to $200 million). At that time, someone asked me to explain the principle of this thing. To be honest, it’s not that I don’t want to explain; it’s that I don’t understand it. I only know the problems it aims to solve: one is to stabilize yield fluctuations, which can be 200%, then 50%, then 20%, and the second is to stabilize returns against price fluctuations. Specifically, it may draw on traditional financial market collateralized debt obligations, redistributing returns and risks. I can only say that DeFi needs various bold attempts, and I wish it success. So why do I mine? Relatively safe, not anonymous, still stablecoins, with relatively low risks. Currently, the TVL cannot be compared with the AUM metrics of machine gun pool-type projects, meaning that TVL for this project is merely a channel for token distribution, nothing more. The product will take a long time to launch, which means we are still mining air.

September 18, 2020

In my view, if I had to choose essential infrastructure projects in the DeFi world, based on the current development trends of projects, I might only choose two: one is Aave, and the other is Uniswap.
September 8, 2020

If DeFi were to choose a typical representative, the barometer of DeFi, it would undoubtedly be YFI. From market positioning, team technical strength, community consensus, and team character and pattern, it is all top-notch. If you look at the various excellent proposals from the YFI community, each could even be developed into a separate project, which is terrifying. There will be a continuous emergence of outstanding talents and projects. Of course, as the largest holder of YFI in China, my views may be somewhat extreme, and I welcome everyone to correct and discuss. However, I believe that if YFI continues to develop in its current state, it will truly be the leader of DeFi.

Note: This article does not constitute any investment advice. Cryptocurrency investment carries risks; please do not blindly enter the market and be cautious of asset losses.