In a latest weblog put up, cryptocurrency legend and former BitMEX CEO Arthur Hayes stated he has a sizeable bag of GMX and LOOKS tokens. Based on Hayes, the principle causes for investing in each tokens had been the platform’s earnings and the potential for each property to outperform customary Treasury payments.
Let’s take a fast take a look at the on-chain information and examine GMX and LOOKS to their rivals to find out if Arthur’s assumptions maintain up.
GMX Utilization Drops After Robust November
The week earlier than Nov. 16 introduced important price inflows to decentralized finance (DeFi) after the outflow of centralized exchanges (CEX) brought on by the chapter of FTX. GMX beats Uniswap in protocol charges as a consequence of a brief inflow into DeFi.
On November twenty eighth, GMX earned round $1.15 million in every day buying and selling charges, beating Uniswap’s $1.06 million in buying and selling charges on the identical day.
GMX utilization could also be declining, however the token is outperforming the business. GMX token is just 8% away from all-time highs after gaining 59% over the previous 30 days.
Uniswap is GMX’s closest competitor, so evaluating the 2 protocols will inform you which customers want to make use of for buying and selling. Other than a price reversal on November 28, Uniswap continues to outperform GMX when it comes to price income and his every day energetic his customers. In contrast to Uniswap, GMX distributes commissions to stakers of varied GMX and GLP tokens.
Uniswap’s 90-day peak in charges is $5.9 million, whereas GMX’s every day charges are solely $1.4 million. A big distinction in peak prices might point out that his GMX has reached capability when it comes to platform utilization.
Charges generated by GMX might be break up 30% for GMX token holders and 70% for GLP holders. GMX’s present homepage states that the estimated APY of GMX tokens is round 10% and the estimated APY of GLP tokens is 20%. GLP meets Hayes’ 20% annual yield goal, however liquidity supplier is susceptible to impairment losses and value declines, making it troublesome to make sure success towards conservative Treasury methods is.
Use of OpenSea Continues to Dominate LookRare
LooksRare, which can be dwelling to LOOKS tokens, was additionally talked about by Hayes due to the charges the NFT protocol earns. I used to be.
OpenSea appears to have a pure stream of every day energetic customers between 35,000 and 50,000, whereas LooksRare has a smaller vary of 350 to 500 customers. Utilizing this metric, OpenSea is 100 occasions bigger than LooksRare, and the pattern doesn’t seem to alter over the 90-day timeframe.
An extra distinction between the 2 protocols is that OpenSea doesn’t have tokens that situation rewards by staking and inflation mints. Reward emissions might hit his 20% goal for Hayes, however it also needs to be famous that LooksRare is infamous for wash buying and selling. The primary purpose of those wash merchants is to amass extra of his LOOKS tokens, however this may dilute the value.
The not too long ago introduced UniSwap NFT aggregator permits customers to buy LookRare NFTs with out visiting the positioning, probably serving to LookRare win extra “real” offers.
The present distribution of charges is closely centered on OpenSea. Within the final 90 days, OpenSea noticed him peak at $2.5 million in his every day charges, whereas throughout the identical interval, LooksRare noticed him surpass $200,000 in his every day charges. He solely did it as soon as.
Investigating the protocol fundamentals Hayes talked about is a crucial first step when contemplating investing in DeFi and altcoins. Wanting on the aggressive panorama of each LooksRare and GMX, each protocols want extra adoption to overhaul the present leaders. Moreover, his 20% goal set by Hayes may very well be a stretch when analyzing inflated emissions and token costs.
The views, ideas and opinions expressed herein are these of the creator solely and don’t essentially mirror or signify the views or opinions of Cointelegraph.
