Bear markets are always overwhelming But people make their money in bear markets and only figure out how much in bull markets. Although this bear market has been long, the bull will return. But have you positioned yourself to get the most out of the next big run when it comes?
Today, I will go over 3 coins covering 4 of the biggest narratives in crypto. Infact one of these is already up 255% in last 1 year! A returning bull market will only reinforce and multiply those gains. So what coins do we like most for the next bull run? Stick around and find out.
Coin 1: GMX
GMX is a cross-section of 2 huge narratives going on in crypto right now: Perp DEXes and Arbitrum. But, what’s a Perp DEX? A DEX where you can trade perpetual futures contracts. These contracts are a big hedge for whales and institutional investors. So they are important if crypto is going to grow in comparison to legacy finance.
By TVL, @Arbitrum is currently the 4th LARGEST Chain overall,
with more than 28.5% ($450M) of its volume coming from @GMX_IO!
— andrewwww (💙,🧡) (@andrewtalksdefi) March 17, 2023
Before the 3AC, Voyager, and FTX issues, most did their futures trading on centralized exchanges. A lot of them still do. But many have gotten smarter about self-custody but still want to trade or hedge in futures or perpetual contracts. So there’s Perp DEXes for that.
And one of the biggest and fastest growing is GMX. Of the biggest DEXes, GMX is #2 in the last 6 months in Revenues from fees. Only dydx has more. But that’s only 1 reason we like GMX. We think it will do well in the next bull run for another important reason.
On the other hand, we have Arbitrum. Arbitrum is THE leader in the Ethereum L2 story after Polygon. Aside from Polygon’s many L2 solutions, because they have their own chain, they are almost like a hybrid of Layer 1 and Layer 2.
Of the strictly Layer 2 protocols that only provide that support for ETH, Arbitrum is the clear leader. Arbitrum is 9th in total daily active users. In the Ethereum ecosystem, they are behind only ETH and Polygon, who are at #4 and #5. Arbitrum leads Optimism and all other L2 solutions in the most important figure that counts. Adoption. Who is using it.
— Arbitrum (💙,🧡) (@arbitrum) March 16, 2023
So what does GMX have to do with Arbitrum? Yes, you probably know that GMX started on Arbitrum and now is available on Avalanche too. Its $131 million in fees since its launch in September 2021 is by far the most fees generated on any protocol in Arbitrum.
It’s #1 in TVL too. GMX is 3x larger in TVL than Uniswap’s Arbitrum TVL. And that means that many are using GMX or GMX in combination with its liquidity pool token GLP as a proxy for Arbitrum. So, if Arbitrum does not have its own token yet, how can people take part in Arbitrum’s growth? For now, the most popular answer to betting on Arbitrum’s future is to buy GMX.
That leads to the question of will interest in GMX fade when Arbitrum does launch its token. I don’t think so. Because when we shift into a bull market, which is the theme of this video, interest in trading on GMX will grow exponentially. Open Interest will rise as more people are trading to hedge gains or to use leverage to try to hit that one homerun that will set them up for life.
If you’ve been here for past bull markets, then you know it will happen. It gets manic and full of hype, FOMO, and everything else that gets more and more people jumping into the market. And GMX will benefit hugely from this. Have you tried GMX or any Arbitrum protocols? How do you like them? Let us know in the comments below.
Coin 2: FRAX
Frax is another coin we like when the bull returns. And because they have a stablecoin, I mean the Frax Shares coin $FXS. Not the $FRAX stablecoin. Frax interested us initially due to their ‘hybrid’ stablecoin project. We still like what they are doing there but they decided to go fully crypto collateral on it. They are no longer trying to make it an algorithmic stablecoin. Frax thinks it’s too risky and they are going to go the DAI-style crypto collateralized route.
And it’s probably a good move for them because they recently made a huge move that few people noticed. In fact, the last time we featured them here about 6 or 8 months ago, this program didn’t exist. What am I talking about? Frax Liquid Staking Ethereum. When the bear looked to be continuing on strongly in November, Frax launched liquid staking. It was a bold move.
Feeling degen? You can actually up this to 50%+ APR by looping your sfrxETH at @MetronomeDAO. 🌚
(Deposit sfrxETH -> mint msETH -> sell msETH on Curve for more ETH and repeat) pic.twitter.com/hI5wgiZM1m
— Grills (¤,¤) 🦇🔊 (@CryptoGrills) March 18, 2023
And boy did it pay off. In 4 months, they now have over 113,000 ETH locked in their staking program. That puts them in a solid 4th place with Lido as the undisputed leader. I know you’ve heard me say this before but narratives matter in crypto.
You can have the hottest thing going but if it’s in a sector no one cares about, then people won’t notice and you won’t make money. Sometimes they notice later and you DO make money. And sometimes they never notice and your investment just sits there.
Liquid staking is a huge narrative in crypto right now. The Shanghai upgrade is coming to Ethereum. This means that liquid staking protocols are in a position to benefit whether the bull market has started again or not. In fact, the only thing the bull market will do is give more lending, staking, and investing options to the staked tokens like frxETH.
Coin 3: Mina Protocol
Another big narrative we like is zero-knowledge proofs. The recent love for them for privacy and scaling through rollups centers on Layer 2 solutions for Ethereum. And yet, there is a light, fast, secure, zk-based Layer 1 chain that most people are ignoring. Mina Protocol.
As privacy becomes more important like it is starting to now again, Mina’s importance grows. Other than Polygon, who is into lots of things not only zk, Mina is by far the largest zk-only based project.
zkIgnite, Cohort 1 has welcomed 500+ builders working on zkApps and devtools to the Mina ecosystem ⚡️
Check out the blog to learn more: https://t.co/8cXuTbwh84
Here’s a recap of each weekly gathering 🧵
— Mina Protocol 🪶 (@MinaProtocol) March 15, 2023
At $540 million in market value, MINA is the #67 project in crypto right now. And everyone is ignoring it for the hot new Ethereum L2 solution using the same technology and competing with 10 other L2 solutions. It doesn’t make any sense. If zk gets huge, like we think it will, then you will want the leading Layer 1 project in your portfolio.
One important note is that they use a similar Proof of Stake consensus that Cardano uses. This system, called Ouroboros, uses staking as its way to circulate new tokens into the market. Like Cardano. So if you do buy Mina, you defintiely want to stake it to earn those rewards and keep your ownership % the same when new tokens hit the market.
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