DeFi 2.0 - Protocol Owned Liquidity (OlympusDAO, Wonderland and Euphoria)

Let me introduce you to the latest hype or the grandest "ponzi" scheme in crypto DeFi today. lol. All these were started a few months back by some of the brightest minds from OlympusDAO. The idea was to solve some of the existing problems of DeFi 1.0 - liquidity farming/mining. Currently, the protocol/application will have to provide incentives (farm tokens) for users to provide liquidity to the various LPs (liquidity pools e.g. providing BTC-USDT, CAKE-USDT to earn CAKE) but there are often no incentives for the users to keep/hold the farm tokens, hence there will be constant selling pressure.

The screenshot is taken from Olympus FAQ

OlympusDAO introduced the concept of having the protocol own their liquidity which will ideally remove the selling pressure based on game theory. Assuming if there are 2 people holding the OHM token, the most beneficial move for the both of them is to stake the token. Bonding/minting more tokens will be beneficial as well but not as much as staking while selling is the worst move. As long as both of them do not sell at the same time, all will be good but if that happens, the protocol/"ponzi" will break/fall apart and there will be a "bank run" where the token value might go to 0. In my opinion, this scenario is less likely to happen (I will elaborate further below) for the more established protocol where they have a loyal community/supporters such as OlympusDAO and Wonderland. The success of OlympusDAO has demonstrated that protocol owned liquidity works and is being termed as DeFi 2.0.  As a result, there are many forked versions of it appearing on different chains and I have decided to ape/participate in 2 of them (TIME and WAGMI). OlympusDAO is not an option for me because it is on the Ethereum network.

If you are a more visual person, I will recommend this youtube video by Whiteboard Crypto - What is DeFi 2.0? How Olympus and TIME actually work.

I shall not bore you further with how bonding/minting works and let's take a look at why the hype. If you head over to Wonderland on Avalanche, you will see these metrics and the one that stood out would be the yield of ~82,000% APY. 

Wonderland (TIME): https://app.wonderland.money/#/dashboard

The other interesting metrics would be "Backing" and "Runway". Backing simply means for every 1 TIME token, it is backed by $1,590 worth of other assets (AVAX and MIM - Magic Internet Money. Sounds like a total scam now. lol.). In stock/equity terms, that would be the NAV and buying 1 TIME now means buying it at a premium/PB of ~5.39. This is why I mentioned that the token is unlikely to go to 0 because the protocol does own other assets that provide a backing/floor value which should grow over time from liquidity/minting fees. Runway is the number of days the staked token emissions can be sustained at a given rate (Lower APY = longer runway). 

So why is the yield so high? Auto-compounding through rebasing. Once you stake the TIME token, you get MEMO which is just staked TIME and the MEMO will rebase/compound every 8 hours at 0.6152% (much more realistic? lol). To put things into perspective, the investment will be compounded 1,095 times a year as compared to what the banks/CPF is doing - just 12 times a year. Anyway, I have staked for slightly more than 2 weeks and my profit is about US$500 with a capital of US$2.2k.

There is even a calculator for one to simulate your potential return. Assuming everything stays constant (unrealistic), I will have 10 lambos worth US$2.2 million after a year with a capital of US$2.2k. lol. 

The screenshot is taken from OlympusDAO

If we were to reference and look at how the yield of OlympusDAO changes over time, it went from an all-time high of 180k% to ~7k% today. Hence, it is obvious that the yield of Wonderland will not remain at 82k%.

In a semi worst-case prediction, assuming the yield of Wonderland falls to 7k% and the price of TIME falls to the backing/floor value, I will no longer have any lambo but US$191k is still pretty decent. lol. The actual worst-case scenario will be the project fails and I lose all my capital of US$2.2k. In my opinion, that's definitely worth the risk - limited downside with unlimited upside. On a side note, the founder (Daniele Sestagalli) has plans to give the TIME token more utility through games so let's see how it goes :)

Euphoria (WAGMI): https://app.euphoria.money/#/dashboard

The next one which I aped is Euphoria in Harmony. Check out the crazy high APY ~760,000%. They are created/forked by the ViperSwap team and is relatively more reliable (IMO).

Let me just elaborate slightly on the minting/bonding process. One can provide those assets on the left (WAGMI-DAI LP, BUSD, etc.) in exchange for minting new WAGMI tokens at a discount. This is how the protocol owns the liquidity (WAGMI-DAI) as compared to you owning the LP. For simplicity, it makes sense to mint when the discount is higher than the 5 day ROI from staking. That is because when one mints the token, it has a vesting period of 5 days. Anyway, I started Euphoria about 2 weeks back with a capital of ~US$400 and it is worth ~US$1.1k now.

OlympusDAO (OHM): https://app.olympusdao.finance/#/dashboard

Anyway, OlympusDAO has much better metrics and dashboards compared to Wonderland and Euphoria. Almost 90% of OHM is being staked and there is even a breakdown of the treasury assets.

As you can see, I allocated very small capital for such risky play. Given that the APY is so high, there isn't a need to risk too much money as a small capital should do wonders too (if it works). Technically, one can leverage further using MEMO and MIM but I am not planning to do it for the same reason - not going to take on more risk.

Hopefully, this will be an eye-opener for those not into DeFi and that it has piqued your interest. There are so many articles and youtube videos for one to learn about DeFi. Before you dismiss crypto as a scam/ponzi, take some time and spend some effort to understand it and you will be rewarded. Stay safe and huat ah!

Anyway, I have blogged about different ways to leverage crypto to build wealth for people with different risk appetites:

The safer approach using stablecoins

- Earning High Interest Using BlockFi and Celsius Network

- Earning High Interest Using BlockFi and Celsius Network Part 2

- Earning High Interest Using BlockFi and Celsius Network Finale

Risky approach but more hassle-free

- CakeDeFi - The Easy Way to DeFi

- CakeDeFi Freezer + Tracking in StocksCafe

- CakeDeFi - New Plan/Strategy

Highest risk and you are on your own

- DeFi apps on Binance Smart Chain (BSC) such as PancakeSwap and PancakeBunny

- DeFIRE with DeFi

- DeFi - Aave, QuickSwap and Adamant on Polygon (Matic Network)

- DeFi - Farming MATIC using Aave + Curve

- DeFi - Risks and Dangers (I Lost 97% Overnight)

- DeFi - Harmony ONE and Fantom

- DeFi - Terra (LUNA) & Anchor Protocol (20% Interest)

- DeFi - Terra Mirror Protocol Delta Neutral Strategies

- DeFi - Terra Pylon Protocol Lossless Investments

- DeFi 2.0 - Protocol Owned Liquidity (OlympusDAO, Wonderland and Euphoria)

If you are interested in the platform I am using, do sign up using our referral links for some bonus :)
BlockFi: Deposits US$100 or more into your BlockFi Interest Account (BIA), you will earn US$10 in BTC and we will earn US$10 in BTC too.

Celsius Network: Earn US$40 in BTC with your first transfer of US$400 or more and we will earn US$40 in BTC too.

CakeDeFi - Deposits US$50 or more into your CakeDeFi account, you will earn US$30 in DFI and we will earn US$10 in DFI too.

Gemini: We will both receive US$10 of bitcoin after you buy or sell US$100.

On a side note, Futu's moomoo app sign-up promotion is slightly different every month (AAPL shares, cash coupon, etc. Do read the T&C here for more information). If you have yet to open an account, you can do so using our referral link :)

Do like any of the following for the latest update/post!
1. FB Page - KPO and CZM
2. Twitter - KPO and CZM
3. Click here to subscribe using email :)
4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)

SP Group Wholesale Electricity No Longer The Cheapest Plan

I have blogged about how cheap/low the SP Group Wholesale Electricity rate was previously but unfortunately, those days are gone:

- Cheapest Electricity Plan - SP Group Wholesale Electricity

- Cheapest Electricity Plan - SP Group Wholesale Electricity Part 2

- Cheapest Electricity Plan - SP Group Wholesale Electricity (2021)

I was shocked to see my latest electricity bill. 370.09 kWh - $200.35 which translate to 54.14 cents/kWh!

That is more than doubled the regulated electricity tariff rate of 25.80 cents/kWh.

The image is taken from Seedly

This should have been obvious given that 5 electricity retailers closed down last month - Seedly:
Why Are Electricity Retailers in Singapore Closing Down? What Does it Mean for Singaporeans? This is probably because if they had continued to operate, they will only be incurring more losses.

If you head over to the OEM site to compare prices/plans, the cheapest plan one can get now is a x% discount off the regulated tariff rate. If you scroll further down, some of the fixed-rate plans are even higher than the regulated tariff rate for this quarter. In my opinion, this is an indication that the regulated tariff rate will probably increase after this quarter and they are pricing it in now given that the plan/contract is going to be for the next 6-24 months.

Regardless, I have decided to cut our losses as well by switching the wholesale plan back to the regulated tariff rate. This can be done directly from the SP website.

It may/may not give you a date that is much further away but for my case, the default date was next year Jan. Obviously I am not going to wait that long -.-"

I selected the nearest/closest date where the transfer/switch can be done.

For the earlier date, one just got to submit your own self-read meter which isn't difficult.

A couple of reasons why I decided to just go back to the regulated tariff rate:

1. Less trouble/hassle - Everything can be done online and there's no need to worry about it "closing shop"
2. No contract - Assuming if the electricity rate ever falls again, I can easily switch back to the wholesale rate.
3. At the moment, I do not see significant savings for the hassle/trouble to switch to other retailers and getting myself  "locked" in a contract for a miserable 3-6% discount. Simply not worth my time and effort.

Hope this helps!

On a side note, Futu's moomoo app sign-up promotion is slightly different every month (AAPL shares, cash coupon, etc. Do read the T&C here for more information). If you have yet to open an account, you can do so using our referral link :)

Do like any of the following for the latest update/post!
1. FB Page - KPO and CZM
2. Twitter - KPO and CZM
3. Click here to subscribe using email :)
4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)

Endowus - October 2021

I'm on my block leave and we just went on another staycation at Shangri-La. You can read about our previous staycation here - Shangri-La Garden Wing Staycation With Baby Ong. This time round Baby Ong enjoyed it so much more!

Risk Profile
Goal type: General wealth accumulation
Risk tolerance: Maximise returns (loss tolerance -60%)
Monthly investment using SRS: $638

I have modified my monthly investment in order to max out my SRS contribution for the year.

Account Summary

Capital: $27,530.00 (SRS $17,530 and CPF $10,000.00)

Current: $32,854.68 (22.99%)

There are quite a few differences as compared to StashAway. Firstly, all the cash has been invested while StashAway keeps 1% of the portfolio in cash. Secondly, the fees are not deducted on a monthly basis. The Access Fee charged by Endowus will be deducted at the end of each quarter as stated in their FAQ.

As of 20 November 2021, the portfolio value is $33,648.05. The return shown in percentage is just a simple return (P&L divided by capital) including the $10k investment from CPF OA.

It will be clearer/more accurate if we look at the respective portfolio.

I blogged about using Fund Smart to invest my CPF here. On a side note, Endowus is performing much better as compared with StashAway given that both portfolios had the same capital/deposit and started around the same time (StashAway had a few months of headstart).

Asset Allocation

This shows that the number of shares for each fund that I owned:

CPF

- LionGlobal Infinity US 500 Stock Index Fund (4,017.6700)

SRS
- Dimensional Global Core Equity Fund (252.3680)
- LionGlobal Infinity US 500 Stock Index Fund (2,914.7900)
- Dimensional Emerging Markets Large Cap Core Equity Fund (111.4660)
- Dimensional Pacific Basin Small Companies Fund (101.9610)

Transactions

That's all! Overall, I think the statement is pretty straightforward and easy to read. On a side note, StocksCafe does not have the ability to track funds, hence unable to do any form of comparison/benchmark.

If you are interested in Endowus, do use our referral link for our readers! You will get S$10,000 managed free for 6 months ($20 equivalent) and we will get $20 too! 

On a side note, Futu's moomoo app sign-up promotion is slightly different every month (AAPL shares, cash coupon, etc. Do read the T&C here for more information). If you have yet to open an account, you can do so using our referral link :)

You might be interested in the previous monthly update too:

- Endowus CPF/SRS Review

- Endowus - December 2020 - $12,466.20

- Endowus - January 2021 - $13,080.35

- Endowus - February 2021 - $13,549.30

- Endowus - March 2021 - $15,484.29

- Endowus - April 2021 - $16,570.37

- Endowus - May 2021 - $17,325.44

- Endowus - June 2021 - $28,840.67

- Endowus - July 2021 - $30,013.78

- Endowus - August 2021 - $31,198.92 

- Endowus - September 2021 - $30,827.27

- Endowus - October 2021 - $32,854.68

Do like any of the following for the latest update/post!
1. FB Page - KPO and CZM
2. Twitter - KPO and CZM
3. Click here to subscribe using email :)
4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)

Portfolio - October 2021

Last month has been more challenging because Baby Ong is sleeping lesser and later now which I blogged about here - StashAway - September 2021. She is more clingy, wants our attention, becoming smarter and most importantly growing up healthily. Previously, we could leave her in the playpen/jumper while we proceed with our own activities (having lunch/dinner, using laptop, etc.). Nowadays, she is willing to enter the playpen only if one of us is inside as well and refuses to go into the jumper. Besides that, she is now aware of the danger of heights and will always turn and lower her legs first when coming down from the bed/sofa as well as slide. lol.

Anyway, our portfolio reaches another new high! It increased by 16.22% to $1,452,947 - $9,515.58 of capital injection and $193,217.72 of capital gain. This includes $200,693 of leverage/debt (gearing/debt ~16.03%).

If you prefer to look at numbers, this is the raw data used to generate the above bar graph. These numbers are as of the last day of the month.

"Cash Flow" is the amount of money being injected/withdrawn from the portfolio (buying stocks = +ve cash flow while selling stocks and collecting dividends = -ve cash flow)

SOLD
- Chip Eng Seng (8,000 units) @ $0.435

- Far East Hospitality Trust (10,300 units) @ $0.635

Similar reasons as my previous sell transactions, these stocks can't be pledged as collateral so I decided to sell them because I wanted more capital to buy more crypto/LUNA. 

In my opinion, Chip Eng Seng should not have diversified to the education business. It doesn't make sense because there is no synergy between them. After holding for about 5 years, the simple percentage return is -1.99% and the annualized return is -0.41%.

Far East Hospitality is one of the REITs that were trading below NAV and had a higher dividend yield. Definitely would have kept it if I did not venture into crypto. Regardless, after holding for about 5 years, the simple percentage return is 34.51% and the annualized return is 5.73%.

BOUGHT

- None

Did not buy stocks or deploy any leverage but bought more LUNA because the next catalyst is the burning of LUNA from the community pool to bootstrap Ozone (insurance) - Burn Pre-Col5 Community Pool. After that burn, LUNA total supply will decrease by ~10% and the UST market cap will increase by about 3-4 billion. In addition, the burn will increase staking returns by x5 bringing the staking yield to double-digit for the next 2 years. I will let you research and determine what it all means for the price of LUNA :) 

Anyway, the idea of using leverage is simple, borrow the money, buy a good/excellent REIT/stock, use the dividends to pay the interests, and keep the difference while ensuring that we will never get a margin call/trigger. Once again, leverage has its risk and is definitely not for everyone. We see it as our way of buying a second property without incurring any of those taxes (ABSD, rental income tax, etc.). You can take a look at this - Leverage Performance 2020.

Given that it is a brand new year, I have adjusted my SRS contribution to $1,276 per month with the intention of maxing it by year-end. We have also decided to open another StashAway portfolio for Baby Ong. You can read about Our Insurance and Investment Plan for Baby Ong.

Our Monthly DCA for October - $1,376

$100 Cash for Baby Ong - StashAway Risk Index 36%

$638  KPO's SRS - StashAway Risk Index 36%

$638 KPO's SRS - Endowus Loss Tolerance -60%

Dividends
The total dividends collected this month is $208.97. The breakdown is as follows:

Company                     PayDate         Shares Total

Ping An Insurance    25-Oct-21         500         HKD 475.56 (~S$82.51)

Keppel DC REIT     20-Oct-21         8,900 $126.46

Total dividends collected for 2021: $24,803.71
Average dividends per month for 2021: $2,480.37

StashAway

KPO

CZM

Capital: $24,434.39

Current: $‭‭‭‭27,072.58

If you are interested in StashAway, do use our referral link. You get $10,000 free management fees for 6 months and we will get $16!

If you want to extract those transactions information from StashAway, do take a look at this article - StashAway Transactions Parser.

Endowus

Capital: $27,528.00
Current: $32,975.54

I decided to invest my CPF OA a few months back and blog about it here - Investing CPF OA Through Endowus.

If you are interested in Endowus, do use our referral link for our readers! You will get S$10,000 managed free for 6 months ($20 equivalent) and we will get $20 too! This access fee has no expiry date.

Crypto

Tracking crypto investment becomes very painful when the number of coins increases or when I move across to different networks. Hence, to simplify the tracking, I will just be tracking the capital I put in vs the current value at the end of the month.

Capital: SG$181,623.50 + US$3,130.32 (leverage) ~ SG$185,848.18
Current: SG$‭‭‭491,181.14 + US$3,130.32 (leverage) ~ SG$495,405.82

If you prefer a pie chart. 

Crypto - FTX

I am holding some RUNE on FTX. Initially wanted to try out providing liquidity on Thorchain because of the unique ILP (Impermanent Loss Protection) but got lazy to deep dive further because the set-up was troublesome (new wallet, upgrade BEP2 RUNE to native RUNE, etc.).

Crypto - CakeDeFi

Sitting on a decent profit with the majority of my DFI in the freezer until Dec. The initial plan was to try this for a year but have decided to move the fund here to Terra/LUNA once the DFI are out of the freezer because I have more faith in that performing well but have decided to make my first withdrawal into Kucoin to buy Kadena (KDA) which I will elaborate further later. In my opinion, CakeDeFi is still a good starting place for someone that is planning to try out DeFi/getting high yields in crypto without worrying about any rug and exploit.

CakeDeFi - Deposits US$50 or more into your CakeDeFi account, you will earn US$30 in DFI and we will earn US$10 in DFI too.

Crypto - Kucoin

Kucoin was supposed to be the replacement to buy LUNA after the Binance ban but they do not accept fiat deposit via wire. The conversion for USD to USDT in FTX has a spread/fee that makes it not ideal to wire into FTX and withdraw USDT to Kucoin. A reader suggested buying LUNA (ER20 token) on Gemini and withdraw (free) it out to Kucoin before withdrawing to Terra network. This seems to be the most cost effective way but I have yet to try it.

I decided to make my first withdrawal of DFI to Kucoin because I could not get USDT on it. Initially sold the DFI and bought LUNA but eventually decided to sell LUNA to buy Kadena (KDA) instead after a few Twitter Terra influencers (who bought LUNA when it was below a dollar) started shilling it. Kadena is unique/different in the sense that it is a scalable PoW network which is highly efficient, capable of processing even more transactions than Solana. It is ironic because the latest/newest networks and even Etheruem are on/moving to a PoS network because it is supposedly better. In addition, PoW token has selling pressure from the miners and do not has yield unlike PoS token. At the moment, it isn't really proven tech and I will keep the allocation to KDA small because of the lack of convinction.

Crypto - Celsius Network

I still have a bit of BTC and Celsius token which I accumulated previously while earning high interest using GUSD. No plans on moving them at the moment.

Celsius Network: Earn US$50 in BTC with your first transfer of US$400 or more and we will earn US$50 in BTC too.

Crypto DeFi - Harmony ONE

ViperSwap

LootSwap

I exited and moved almost all of my investment from the other chains/networks into Terra except these that are being locked/vested till around Christmas this year. Similarly, the plan is to move them to Terra once they are unlocked.

Crypto DeFi - Terra

I blogged about it previously - DeFi - Terra (LUNA & UST) & Anchor Protocol (20% Interest) and DeFi - Terra Mirror Protocol Delta-Neutral Strategies. I have moved most of my crypto money into Terra including CZM's initial investment because this is my high conviction crypto pick. lol. In my opinion, LUNA can easily go to 3 digits because it is based on the demand for UST which will only increase as time goes by where more projects are being launched (it is happening right now!), UST going cross chains, and getting listed on more exchanges. We have about 5.2k LUNA now with 48% of them staked, 21% as bLUNA, 30% in LUNA-bLUNA LP and the remaining in the wallet/exchange. We will become a crypto millionaire once LUNA reaches ~$192 :)

On a side note, Ape Board is not capturing the Psi tokens I got from Pylon Swap which is worth around US$47k as well as the bETH deposited into Nexus Vault (at the time of writing). The actual total portfolio in Terra is ~US$342k.

Regardless, you can refer to our Terra portfolio on Ape Board below for a more detailed breakdown:

Our Terra Address: terra19erxpg9zvsmptqalsmvwrsmuquk55luzynsl7r

Just for fun for those that are on Terra already, you can check out your degen score here. I would say mine is pretty high except that I do not hodl MIR airdrop tokens hence the missing 3 points.

Anyway, I have blogged about different ways to leverage crypto to build wealth for people with different risk appetites:

The safer approach using stablecoins

- Earning High Interest Using BlockFi and Celsius Network

- Earning High Interest Using BlockFi and Celsius Network Part 2

- Earning High Interest Using BlockFi and Celsius Network Finale

Risky approach but more hassle-free

- CakeDeFi - The Easy Way to DeFi

- CakeDeFi Freezer + Tracking in StocksCafe

- CakeDeFi - New Plan/Strategy

Highest risk and you are on your own

- DeFi apps on Binance Smart Chain (BSC) such as PancakeSwap and PancakeBunny

- DeFIRE with DeFi

- DeFi - Aave, QuickSwap and Adamant on Polygon (Matic Network)

- DeFi - Farming MATIC using Aave + Curve

- DeFi - Risks and Dangers (I Lost 97% Overnight)

- DeFi - Harmony ONE and Fantom

- DeFi - Terra (LUNA) & Anchor Protocol (20% Interest)

- DeFi - Terra Mirror Protocol Delta-Neutral Strategies

- DeFi - Terra Pylon Protocol Lossless Investments

If you are interested in the platform I am using, do sign up using our referral links for some bonus :)
BlockFi: Deposits US$100 or more into your BlockFi Interest Account (BIA), you will earn US$10 in BTC and we will earn US$10 in BTC too.

Celsius Network: Earn US$50 in BTC with your first transfer of US$400 or more and we will earn US$50 in BTC too.

CakeDeFi - Deposits US$50 or more into your CakeDeFi account, you will earn US$30 in DFI and we will earn US$10 in DFI too.

Gemini: We will both receive US$10 of bitcoin after you buy or sell US$100.

Crypto.com: Sign up using our link, stake SG$500 worth of CRO and we both get US$25 in CRO

FTX: We will receive 25.00% of your trading fees and you will receive a 5.00% fee discount on all of your trades.

If you are interested in the smart portfolio tracker (StocksCafe) which I am using as shown above, sign up using my link for a longer trial period :) Refer to our Referrals page for more information.

On a side note, Futu's moomoo app sign-up promotion is slightly different for this month (from SGD 200 stock cash bundle to iPhone and AAPL shares. Do read the T&C here for more information). If you have yet to open an account, you can do so using our referral link :)

You might be interested in these blog posts too:
- 2020 Net Worth

- Leverage Performance 2020

- 1% Net Worth to Crypto (I went down the rabbit hole and it is ~20% now. lol)

- Portfolio - December 2020 - $669,630

- Portfolio - January 2021 - $712,898

- Portfolio - February 2021 - $742,364

- Portfolio - March 2021 - $866,309 

- Portfolio - April 2021 - $946,521 $935,646

- Portfolio - May 2021 - $952,839

- Portfolio - June 2021 - $988,215

- Portfolio - July 2021 ($1 Million Achieved!) - $1,030,905

- Portfolio - August 2021 - $1,179,579

- Portfolio - September 2021 - $1,250,214

- Portfolio - October 2021 - $1,452,947 

Do like any of the following for the latest update/post!
1. FB Page - KPO and CZM
2. Twitter - KPO and CZM
3. Click here to subscribe using email :)
4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)