How a Fun NFT Utility Platform will Solve DeFi Sustainability Issues

MINImarketmakersNFT.com

Problem with DeFi’s “PaSsiVe InCoMe For LiFe” Trend

Decentralized finance (DeFi) provides fantastic options for marginalized individuals and those who are tired of the slow, expensive, and unrewarding traditional financial system. Despite the many positives, there are a multitude of problems. Perhaps the most significant being the fact that scams/“rugpulls”, incompetent teams, and unethical practices have become quite commonplace. The responsibility ultimately falls on users to gain the knowledge and skills needed to safely navigate the defi landscape. Unfortunately, that often means investors learn some hard lessons -especially those that were investing with money that they couldn’t afford to lose in the first place. Many people turn to influencers who tell them to do their own research, but then the “not financial advice” often ends up steering investors in the wrong direction. Certainly not all influencers have bad intentions, and not all defi investors are degenerate gamblers. However, even smart successful investors are forced to navigate a system that is often rigged against them, and profits greatly from ignorance, inexperience, and mistakes.

False Promises

In our view, the most harmful variables that plague the defi space are the false promises that most projects seem to make. Bad actors use promises of passive income for life and insanely high returns to lure investors into scams, and even defi projects acting earnestly fail to deliver because of unsustainable tokenomics and promises of rewards that are simply impossible for the protocol to produce.

Most defi platforms follow the exact same pattern. The project launches and the native token price pumps. Early investors then sell off their positions, and the price plummets. Sometimes this is a gradual process, sometimes it happens rapidly, but investor confidence disappears and sell pressure takes over.

Take a look at a few charts and note the pattern.

Popular Passive Income Protocols

These charts represent the native token value of several very popular defi passive income protocols that would be referred to as some of the more “successful” examples. What do they have in common? They pump initially, some sustain value for a bit longer than others, but they all inevitably get to a point where they begin a steady and consistent loss of value.

The problem here is twofold. First and foremost, these protocols offer unsustainable rewards. They promise passive income for life and annualized rates of return that are not only unrealistic, but they are often embarrassingly inflated. In what world does 7500% APY seem logical, much less 84,000%? Even some of the more modest protocols offering much lower rates have proven unsustainable and followed the same path of decline.

Tricky Tokenomics

The only reason projects can offer such high APYs is because they are paying out rewards in their own native token. There is no promise that the token will hold value. Some protocols with a token supply cap have proven that they are not even sustainable when it comes to paying out rewards in their native token. I think we can speak for most investors when we say that the type of sustainability we are looking for is actual sustained value. Once a project starts to dump, many teams just give up or take what they can and run. The legitimate teams pivot and try to curb sell pressure with taxes or try to add utility to their native token through other ventures. This is honorable, and I hope they find success. However, they are fighting an uphill battle as they now have a very large, often never-ending debt to investors. Fulfilling this debt is a tall order for even the most skilled, effective teams.

Hot Take: Most DeFi Products do NOT need a native token.

We Need Real Solutions!

Sustainability at the protocol level is NOT enough. We need rewards with sustainable VALUE. We need rewards that do NOT depend on new investors in order to pay current holders. We need protocols to STOP worrying about buy and sell pressure or trying fruitlessly to manipulate it with taxes and fees. The pressure should NOT be on the buyers and sellers to sustain the value of the protocol. The pressure should absolutely be on the project, the protocol, and the team behind it. Period. They need to consistently CREATE value for their investors. If the project is worthy of our investment, it should provide a valuable service. It should use our capital to generate valuable rewards regardless of investor sentiment. Hype and investor confidence should NOT impact whether the protocol is profitable to investors. Investor confidence should be a direct product of the protocol’s success and profitability. It is up to investors to set a standard that these projects must meet. We need to stop giving our capital to projects that just want to profit at our expense. The protocol and the team behind it should ONLY profit if you, the investors, profit as well.

The MINI Market Makers Vision for DeFi

Our team shares several core values that drive every aspect of the development of MINI Market Makers products. Our ethics and morals are at the top of that hierarchy. The goal is to ensure profitability for every single investor. We are creating a platform that performs effectively regardless of the number of investors, size of the treasury, or level of hype. We aim to earn investor confidence and claim market share based on the actual performance of our protocol and the consistent value that we provide to MINI holders. This begins with sustainability. True sustainability that extends far beyond buzzwords and empty promises.

“Use an established, free-market token that already has growing extrinsic value and a multitude of use cases.”

Perhaps the most relevant way that we are solving the current problems outlined above is our lack of a native token. There are no inflationary tokenomics. No rebases or reflections. No ponzi-like dependence on new investors. Many defi protocols talk about their need to create new utility for their tokens outside of the current protocol. To us, this is a non-starter, and it is unrealistic to believe that any attainable new utility can keep up with the high rewards output that many projects are committed to. There is a simple solution right in front of everyone… Use an established, free-market token that already has growing extrinsic value and a multitude of use cases.

This is why we provide all rewards to MINI Market Makers NFT holders in $AVAX. There is no need to focus on buy and sell pressure. The success and profitability of the entire project rests on the protocol itself. It is our job to consistently generate rewards and ensure that the protocol is successful. As it should be. MINI Market Makers does not “blow smoke” or use gimmicks. Investors will profit as a direct result of the profitability of the protocol… and as a result, investor sentiment and hype have no impact on performance.

Sustainability and Aggressive Transparency

The reason that our structure sustains over time is because it involves actual profit sharing, and an investment strategy that preserves the initial capital. We keep investments liquid in order to enter and exit positions as needed to ensure a profitable strategy.

Further, we do not make empty promises of predictable lifetime rewards. Instead, we offer something we are calling “aggressive transparency”. Everything that we do to earn rewards for holders is openly visible to the public. This goes a lot further than just sharing some wallet addresses. Transparency is built into the protocol, and all data is visible within the dApp.

Sustainable Yield Farming through Calculated Exposure to Risk

There is a large technical barrier to entry into the DeFi space, particularly in yield farming. We aim to remove that barrier and provide an easy way for anyone to earn farming rewards by simply purchasing a fun NFT… but why yield farming?

Simply put, yield farming refers to the general use of crypto assets to earn interest. This includes staking, lending, and providing liquidity to decentralized exchange platforms in exchange for a share of transaction fees and other rewards. This makes up the core of the MINI Market Makers investment strategy. When compared to many other methods of defi investing, yield farming is a well-established and generally predictable way to earn consistent returns. There are many options within this category that allow investors a significant amount of control over capital and freedom to adjust strategies as markets evolve.

There are several inherent risks associated with yield farming strategies. These include smart contract bugs, hacks & exploits, risk of scams, whale manipulation, and impermanent loss. Many of these risks are inherent to defi investing in general, and others can be mitigated with careful diversification and calculated exposure to assets that line up with investment goals and risk tolerance.

Our team has extensive experience actively managing investment portfolios with the primary goal being preservation of initial investment capital. We aim to maximize yield by carefully diversifying across a variety of sectors and risk-levels. We prioritize investments that keep our capital liquid. We actively study the markets and monitor investment performance to ensure that we move in and out of liquidity farms as needed to reach our investment goals. Investment plans are devised based on the underlying narratives that we determine are likely to take place in the market, and we manage our exposure to specific assets based on these narratives. Diversification is a key part of our strategy to ensure that we consistently grow our treasury’s value and minimize inherent risk, without overexposing our capital to any specific investment type.

Security

It has never been more important to thoroughly vet defi protocols. Scams are getting more sophisticated than ever, and unethical teams are pulling the rug on their investors frequently. At MINI Market Makers, we are disgusted by this. We take security very seriously, and we aim to ensure that our community feels 100% safe when buying an NFT or investing in our defi products. A small part of that process is the completion of KYC and contract audits.

The MINI Market Makers team will be completing KYC prior to the launch of any of our defi products or decentralized applications (dApps). This will likely be with Obsidian (theobsidiancouncil.com) as they have proven recently to handle security and claims of malicious behavior very effectively and professionally.

We will also be completing third-party audits with Certik prior to the deployment of any smart contract we create. Additionally, our skilled development team is responsible for writing all smart contract code. While there may be instances where openly-sourced code will be used within our contracts, we are not forking existing protocols or outsourcing the development of MINI Market Makers products. ANY code that is not written by our team directly is developed by a trusted network of experienced developers that we have worked with in the past. Needless to say, we do NOT hire freelance devs from low-cost sites such as Fiverr or Upwork. (*I’m sure there are excellent devs available on these platforms, but we are not willing to take the risk of a rogue dev embedding malicious code within our contracts!)

All of these safety measures will be completed prior to the launch of our defi platform or staking dApp. We want to establish safety and trust in our platform from the moment it goes live.

What’s Next?

Over the next several weeks, we will be releasing a series of Medium articles that will provide far more detail regarding our NFT giveaways (phase one), upcoming defi products (phases 2 & 3), investment strategies, and info about our team. We’ll continue to update our community via Twitter and Discord, and our full whitepaper will also be release in the near future to provide all the information necessary to make informed decisions about further investments in our defi protocols.

Some of the topics of our upcoming articles include:

✔ NFT Giveaways & The MINI Representatives - Investment Strategies

✔ Giveaway Automation dApp & Integration of Community Partnerships

✔ NFT Staking Platform Allows MINI Holders to earn Yield Farming Rewards

✔ MINI Marketplace: Fresh Take on NFT Utility & Alternative to DaaS Nodes

✔ Gamified Yield Farming: Play2Earn that Prioritizes the ‘Play

✔ Yield Farming Strategy: Diversification & Active Management - Narratives & High Conviction Plays

✔ Meet the MINI Market Makers Team

Official Links:

Twitter
https://twitter.com/MINIMrktMkrsNFT
Discord
https://discord.com/invite/ddsDEGHFBh

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MINI Market Makers

MINI Market Makers

Providing sustainable weekly rewards to holders through NFT staking and fun, gamified yield farming!