There was a massive leap in the TVL in DeFi over the past 20 months. However, this is a drop in the bucket compared to waht is brewing.
In this video I discuss Kevon O'Leary's statement that a trillion dollars flowing into the sector. We are going to see a lot of the fixed income money moving out of the traditioal realm.
▶️ 3Speak
The crazy thing is that if you pump $1T actual dollars into DEFI the market cap goes up $10T more or less.
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Yep.
That is not a statement that the market cap will go up by a trillion dollars. It is $1T flowing in which will send the MC flying.
As much as I dont like the Wall Street institutions, they do the resources to make things go completely insane.
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HBD, so thanks to our recent exchange of comments and information from BlockTrades we know massive accumulation of HBD is not a threat to security. However, if exceeding haircut due to dropping $HIVE price will trigger breaking the peg downwards, it creates some sort of the risk for HBD investment, doesn't it? Is my understanding of this situation correct?
We were corrected by Blocktrades and it is good to get that clarification. From a security standpoint, a massive accumulation of HBD will not pose a security threat since it is capped at the haircut level (10% presently).
A broken peg is always a threat to a stablecoin both on the high and low side. In your example, it is a threat if the price pushes down to .50 lets say. However, that is where arbitrage opportunities entire.
We have two things always in play. The algorithm that is running HBD which gets it out of human hands as well as the market dynamic which focuses upon profitable opportunities.
In this instance, we would likely see a reverse of what took place a few weeks ago where people decreased the amount of HBD, pushing the price closer to the peg.
Ultimately, it is where distribution enters the picture. If more people are holding HBD and staking it in savings, then those are likely going to provide stability since they will not engage in the market unless there are wild swings. To make things more stable, we more HBD printed overall so the volatility is reduced.
Holding peg is vital. That is why HBD stabilizer gets so much funding from the DAO. It is working hard to keep things as tight as possible.
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Nice information
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