The 3.5% Rule (Market Monday)
How 11m passionate crypto users can change the world
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Level up your open finance game three times a week. I’m releasing this Free for Everyone until November 1. Get the Bankless program by subscribing below.
Dear Crypto Natives,
It’s Market Monday! Every week I scan the open finance market to surface the best opportunities and insights for us.
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Non-violent protests are twice as likely to succeed as armed conflicts. The ones that engaged 3.5% of the population never failed to bring about a change.
This is called the 3.5% rule.
Throughout history we’ve seen an intolerant minority gain the ability to impose their virtue on the majority through sheer willpower: civil rights movement in the U.S., Gandhi’s Quit India movement, the People Power movement in the Philippines—a determined minority can tilt the world.
Going bankless is form of non-violent protest.
Holding non-state currencies. Using an alternative financial system. Believing in self-sovereign money. It’s opting out of a system.
The separation of money from banks is our revolution.
And it’s a revolution in technology—too beneficial to be stopped. A society can’t afford to ignore it. They’ll fall too far behind. It’d be like ignoring the next internet.
But how long will it take—how many of us have to go bankless first?
The 3.5% rule shows that the few can tilt the world of the many:
3.5% of the world is only 270m people
3.5% of Africa is only 42m people
3.5% of Argentina is only 1.5m people.
And 3.5% of the U.S. is only 11m people.
Can we get 11m passionate users of crypto finance?
We still have a ways to go. But maybe we’re closer than we thought.
- RSA
ETH and BTC prices were crushed last week—but fundamentals didn’t change so that means we just keep dollar cost averaging—steady hands, no blinking
MARKET MONDAY:
Scan this section and dig into anything interesting
Market numbers
ETH down to $174 from $209 last Monday
BTC down to $8,132 from $9,918 last Monday
Maker stability fees down to 10.5%—almost single digits
Market opportunities
(Borrow) Margin trade bonus 2x first 250 at Neo (just launched—have not used)
(Lend) Last day to get $50 for funding BlockFi account (6.2% BTC / 4.1% ETH)
(Trade) Dex.ag is aggregator w/ good rep (alt. to 1inch where guy lost $24k wk)
(Invest) in ENS short domain—few days left on auctions (google.eth at 16.75ETH)
(Trade) with Dex.blue (Bankless subscriber impressed w/ delegated key UX)
(Earn) BTC while you shop using Fold app (buy gift cards—earn BTC)
(Earn) also try Pei or Lolli to earn BTC while you shop (have not used)
(Borrow) Trinito claims lower rates than DyDx (3% DAI is too good—beware!)
(Give) $1 can fund $250 worth of ETH 2 grants on GitCoin (last day today!)
New stuff
Awesome money protocol visualizer called myDeFi (missed this last week)
Investing in Uniswap liquidity pools directly from Zerion is so 🔥
GodsUnchained game studio gets $15m (ppl i respect say this game mainstream)
Uniswap liquidity pool analyzer (more improvements coming Tuesday per Caleb)
What’s hot
WBTC borrowing up to 7.36% (was on list at 3%—someone reading Bankless?
60 DAI volatility at an all time low (that means it’s been stable at $1)
Connext means bankless payments and the world is asleep on its potential
Money reads
BTC and ETH will eat privacy chains (I mostly agree w/ this) - Ryan Gentry
A DAO credit union (missing pieces—but in 5 years I can see it) - Jacob Shiach
Learn why the Fed is pumping funds into the overnight rate - Epsilon Theory
Are trusted assets in multi-collateral DAI a good idea? - Hugh Karp
DeFi Aggregators (I partially agree) - Ash Egan
BTC price dropped last week but no change in fundamentals - Hans HODL
Amazon dropped 95% then become $1 trillion, like crypto? - Ted Seides
Last day to earn $40 by subscribing—you can get paid $40 for subscribing to Bankless & funding a BlockFi account—1. Subscribe to Bankless 2. Get access to Deal Sheet 3. Use BlockFi deal & get $50—net earnings—$40. Last day! 🔥
WHAT I’M DOING
Check out a few opportunities I’m capturing right now with my crypto money
Explored a DeFi credit card. Yes, I’m on a hunt to find the best crypto credit card. I’ve signed up for BlockCard, am taking a look a Nexo, Monolith, and Crypto.com. I’m finding each of them have quirks—for instance—BlockCard looks cool, but why on earth do they inject a token call Tern into their product? I hope to get back to you with some answers.
COOLEST THING YOU DID LAST WEEK?
Bankless subscribers are leveling up like crazy—here are cool things you did last week
Lend DAI, borrowed ETH, used Uniswap, bought Set - @slengas 🔥
Helped 1k Venezuelans buy ETH using bolivars - @LocalEthereum 🔥
Lent DAI on Compound and signed up for Bankless - @funnydesigner
I love this community of doers!
WEEKLY ASSIGNMENT:
Make time to complete this assignment before next week
Go to a virtual DeFi Conference. (2-4 hours) You don’t have to travel anywhere or buy a ticket to go to a crypto conference. You can construct your own virtual conference and learn on your own schedule. I do this all of the time—it’s been pivotal in my path to leveling up. This week I want you to attend the DeFi Summit Conference virtually.
Here’s what you do:
Look at the 50+ DeFi Summit videos that were just released
Make playlist of 3-5 videos of interest (my recommendations below)
Schedule 2-4 hours to watch videos (try 1.5x playback speed)
If you have followup questions—find the presenters on twitter and ping them.
DeFi Summit Videos I recommend
VIDEO: Keynote on Exponential Finance (can’t miss)
VIDEO: ConsenSys loan protocol risk scoring (i’ve written about this)
VIDEO: UMA Token Builder (connect some dots before watching)
VIDEO: Composability (fancy word for money legos)
VIDEO: Argent smart wallet (never miss a talk by these guys)
VIDEO: MakerDAO on DeFi regulation
Create an action list of things to try based on the videos.
That’s it! Doing this levels you up almost as much as going to the conference itself. 🔥
Extra Credit Learning
(Beginner) VIDEO: 5 Ways to Get Dai for Beginners by Chris Blec
(Beginner) VIDEO: Zero to DeFi on Argent in less than 90 seconds
(Intermediate) AMA on ENS names in Ethereum
(Intermediate) VIDEO: Whiteboard explanation of Set Protocol
(Advanced) Understanding Ethereum gas markets
MAIN TAKES:
Read my takes but draw your own conclusions
I’m convinced governments will try to kill cash in the decades to come and that means all currency transactions can be censored—we need crypto
Will makes the point that on-chain order books can’t possibly scale for the trading demands in a fully tokenized world—I’m glad multiple projects are working on different approaches
As millions in Maker loans were liquidated this week due to falling ETH prices DeFi Saver saved 20 loans but missed 2—obviously a problem but DeFi Saver has responded well and still seems loved by the community—$1.35m in loans managed today
Reminder: use DeFi products at your own risk especially newer, less tested ones—case in point: a bug in the trading aggregator 1Inch caused someone to lose $24k last wk (he’s gotten half back and the other half has been promised to him)
NBA player tokenizes his contract then the NBA says he can’t, then he responds that he can—remember: permissioned assets still remain…permissioned
Binance is launching a staking service and all exchanges will provide similar—but there’s a big difference between staking money and staking work tokens—the Binance listings are just work tokens
MINI TAKES:
Maker releases its primer on upgrading to multi-collateral DAI. There’ll be some friction in the upgrade, but it’s less bad than I was worried it might be. For instance, if you have a CDP you can seamlessly migrate it to the new system, you do not need to pay it off before migrating. Also, the migration window will be generous, 6 months or so. We’ll still need to deal with different DAIs and different rates on lending protocols in the short term though!
Also Rune from Maker is considering a ETH-only DAI which is cool. The coolest part, this idea came from Bankless members! Davoice321 started an initial thread here which sparked an idea from Rob Mose which became the basis for Rune’s comment—which all originated from their conversations in the Inner Circle. I’m beaming with pride right now.
As trade wars between China and U.S. ratchet up there’s talk of blocking Chinese companies from listing on U.S. exchanges. This is exactly why the internet of assets will be built on an open, neutral platform that can’t be controlled by state actors—a platform like Ethereum.
TWEET-A-QUESTION
Tweet me your question—I reply to one per week
I tweeted a question from the Inner Circle this week:
My answer:
My top dozen favorite answers from you:
Get a job that pays salary and dollar-cost average every two weeks
Read, read, read, but also give things a try and start small
Think in terms of years, measure action by quarters (and more)
I can boil it down to three words for you: buy, try, & abide.
- RSA
P.S. You also might like my 1 & 32 plan for beginners…
Some recent tweets…
Actions
Execute any good market opportunities you saw
Complete the weekly assignment: attend DeFi conference virtually
Level up—no interruption. $12 per mo. 20% off includes Inner Circle & Deal Sheet.
Let’s onboard 1 billion people to open finance…
If you believe in what we’re doing don’t keep it to yourself—share Bankless with as many people as possible.
Post. Tweet. Tell. That’s how we take back our money system.
Need the words? Bruno may have said it best….Bankless is not your daily brainfart
Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.
Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. I’ll always disclose when this is the case.
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