【Supplement | Why I think Yield Vault might have a negligible impact on $BR ?】
Based on TVL data from Bedrock & Cap, @Bedrock has invested over 50% of platform assets ($BTC ), which poses a high concentration risk within a single protocol, leading to the following impacts:
➤ Existing User Risk Appetite
In the current market environment, with frequent DeFi security incidents, Crypto users are showing a trend towards risk mitigation in their investment preferences, especially cautious of complex risk sources.
From Bedrock's perspective, they naturally believe they have fulfilled their duty to audit counterparty risks of institutional capital; however, from the perspective of uniBTC users, Bedrock, Cap, and institutional capital, which involve third-party credit, are all sources of risk.
Thus, the first point of concern would probably be: when existing users realize their invested BTC is heavily concentrated in Cap credit loans, will there be a wave of user fund withdrawals?
➤ Allocation of Existing Funds
According to Bedrock 2.0, it will introduce at least four vault strategies, but just the Yield Vault alone has already consumed over 50% of existing funds, crowding out the deployment capabilities of other vault strategies.
From this perspective, if existing funds are largely deployed in a single strategy, can other strategies still achieve a good leverage effect to create returns that outperform the market with a smaller amount of capital?
➤ Uncertainty of Incremental Funds
Considering the above two points, once existing funds are nearly fully allocated, the breakthrough move would be to attract new capital.
However, given the current market atmosphere, it's impossible to predict how long the bear market will last; the cash is king mindset is becoming a consensus in the market. Do market users have idle Bitcoin on hand? And are they willing to expose it to DeFi risks?
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● The above content does not constitute investment advice (NFA). Users should operate according to their own risk tolerance, DYOR and participate in the investment market cautiously.
● Attached image is sourced from Cap
#Bedrock #CAP #BR
Based on TVL data from Bedrock & Cap, @Bedrock has invested over 50% of platform assets ($BTC ), which poses a high concentration risk within a single protocol, leading to the following impacts:
➤ Existing User Risk Appetite
In the current market environment, with frequent DeFi security incidents, Crypto users are showing a trend towards risk mitigation in their investment preferences, especially cautious of complex risk sources.
From Bedrock's perspective, they naturally believe they have fulfilled their duty to audit counterparty risks of institutional capital; however, from the perspective of uniBTC users, Bedrock, Cap, and institutional capital, which involve third-party credit, are all sources of risk.
Thus, the first point of concern would probably be: when existing users realize their invested BTC is heavily concentrated in Cap credit loans, will there be a wave of user fund withdrawals?
➤ Allocation of Existing Funds
According to Bedrock 2.0, it will introduce at least four vault strategies, but just the Yield Vault alone has already consumed over 50% of existing funds, crowding out the deployment capabilities of other vault strategies.
From this perspective, if existing funds are largely deployed in a single strategy, can other strategies still achieve a good leverage effect to create returns that outperform the market with a smaller amount of capital?
➤ Uncertainty of Incremental Funds
Considering the above two points, once existing funds are nearly fully allocated, the breakthrough move would be to attract new capital.
However, given the current market atmosphere, it's impossible to predict how long the bear market will last; the cash is king mindset is becoming a consensus in the market. Do market users have idle Bitcoin on hand? And are they willing to expose it to DeFi risks?
-
● The above content does not constitute investment advice (NFA). Users should operate according to their own risk tolerance, DYOR and participate in the investment market cautiously.
● Attached image is sourced from Cap
#Bedrock #CAP #BR