THE MOST IMPORTANT LESSON I’VE LEARNED on my journey to become a consistently profitable trader.

My journey started in 2007 but in 2008 paused and didn’t resume again until 2021 (a story for another thread)

I’ve put in a LOT of hours and one lesson stands out

🧵/1

My struggles are undoubtedly very similar to many others’. They play out like this:

Find a strat
Back test. Looks good! Paper trade.
Doing great. Then paper acct blows up.
What went wrong?
Look for new strat.
Rinse and repeat.

It’s a psychologically damaging cycle.

🧵/2

Things that will nuke an account:

Not being consistent.
Changing strategies regularly.
Moving around the rules mid-trade.

And we’ve all been there.

Recently I realized something. ..

🧵/3

See, watching gigabrains like @luckychartape who never seem to miss made me think ‘there MUST be a perfect strategy out there’

But there’s thousands upon thousands of strategies.

🧵/4

You could literally test and paper trade a new strategy every month for the rest of your life…and never realize actual gains.

Because it’s NOT ABOUT THE STRATEGY.

🧵/5

You could read every trading book in existence and keep finding GREAT strategies and never stop blowing up your account.

Because in the end you can have a brilliant strategy but poor execution and fail.

Or a mediocre strategy but great execution and profit.

🧵/6

So what is the secret to great execution?…..

Trading psychology.

Because 80% of the trade is what’s going on in between your ears.

A perfect strat can only account for 20%. So even if you have a meager 10% strat, mastering the mental part still makes you win.

🧵/7

I realized this when I kept reading BOOK after BOOK learning all kinds of strategies but kept blowing up accounts.

Trading IS A SKILL so it can be mastered. But not by learning everything about the markets.
No, instead you must learn everything about yourself.

🧵/8

So on my journey to totally master my trading psychology here are the books I’m reading/have read so far:

The Disciplined Trader (depicted)
Trading in the Zone
The Mental Game of Trading
Mastering Trading Psychology

And I’m always hunting for more.

🧵/9

So if you’re stuck, maybe you’re focusing on the wrong skill.
Reading markets is cool but the money comes from mastery of self.

Cheers mfkers

🧵/ finis

The most important lesson I've learned in trading

SIDE HUSTLE MASTER LIST

In response to my last thread (https://twitter.com/robotdefi/status/1582493219908034561?s=46) a few people wanted me to share my side hustle ideas.

Buckle up, these are REAL ideas I know work (not that BS theory stuff telling you to repost YouTube vids).

🧵/1

Quick note tho…so many people don’t believe they are creative. I think creativity lives in all of us. We all have the power to come up with big, profitable ideas. You just have to cultivate that.

Ok, here’s a list of million-dollar ideas.

🧵/2

#1 Print On Demand t-shirts:

There are many companies like Printful, Viralstyles, Gooten and Printify that will let you upload your designs onto a tshirt template.

Then you just promote your t-shirts and sell them. The POD company handles printing and shipping.

🧵/3

But don’t you have to be a designer?

No. You ever bought or seen t-shirts with just words in them?
If you’re clever or witty or controversial you can just sell shirts with words on them.

Find an awesome font (pay for it if you need to) and put your thoughts onto tees.

🧵/4

The key here is to not be generic. Find a niche. A niche within a niche.

For example, crypto shirts might work, but narrowing to a specific chain or protocol would do even better.

Why?

🧵/5

Its in our DNA, humans naturally feel drawn to community. We need to be a part of something.

We feel a sense of kinship with others in similar situations as us. That’s why studies have revealed humans will show favoritism to strangers from the same town.

🧵/6

And that’s also why you’ll see tshirt ads on Facebook not just for engineers (niche) but engineers from North Carolina (niche within a niche).

Also geographical niches allow you to run Geo-targeted ads.

🧵/7

You can sell these shirts on your own website, or on the POD platform (sometimes), or on Amazon Merch.

Political shirts perform well on Amazon FYI.

🧵/8

You can create your designs on software like Canva if you aren’t a designer.

Or, if you can afford it, you can hire a designer on Fiverr.

🧵/9

You’re not limited to t-shirts either.

You can make jewelry, bags, hats, shoes, leggings…once I even designed a pillow.

At the height of the pandemic there was NO TOILET PAPER in California so I created a mythical toilet paper unicorn design for a throw pillow.

🧵/10

#2 Amazon associate

Amazon’s associates is their affiliate program. You get 4 to 8% of any purchase on the Amazon website as long as the buyer visited the site through your affiliate link.

To get involved you just need a website. But this can be a linktree or blogspot.

🧵/11

If you buy a bunch of stuff from Amazon, just make videos of you showing off your “haul” and post them to Tiktok and Instagram with affiliate links in your bio.

🧵/12

If you don’t, then just search for deals on Amazon (like I share in this tweet: https://twitter.com/robotdefi/status/1580048212781461504) then share the deals you found on Reels and Tiktok.

🧵/13

I personally know a handful of shopping influencers who make a killing just sharing coupons and deals online.

🧵/14

My personal genius idea for this:
If you’re like me and you listen to TONS of audio books, sign up as an affiliate, then do 3min summaries of books on Tiktok and promote Audible subscriptions.

🧵/15

Audible subs pay decent and you could also show people how to use features like speed up sound to “read” faster.

🧵/16

#3 Flip free Craigslist stuff

Did you know Craigslist has a “free” section under the “for sale” tab?

It’s full of couches and desks and tables and all manner of things people are trying to get rid of, if only someone would just come pick it up.

🧵/17

Well, you could easily go pick it up (if you have a vehicle that permits this), clean the item up, and then sell it on Facebook marketplace.

🧵/18

#4 Product videos

Mobile apps are getting pretty advanced nowadays and they’re making activities that previously took a LOT of skill much easier.

Apps like Inshot or Lumafusion (for example) let a total amateur edit a pro looking video.

🧵/19

Get your hands on an app, learn how to become a ninja at making decent vids on your phone, then put up a Fiverr gig to make e-commerce product videos.

Get them to send you the product and then make stop-motion or demo videos for them.

🧵/20

You could easily charge $50 for a video that only took an hour to make.

Ecom people are ALWAYS looking for affordable vids to use in their ads.

Win-win.

🧵/21

#5 Contactless menus

In a post-Covid world many businesses are looking to expand contactless options. One popular implementation is contactless menus. MANY restaurants still don’t have them, but wouldn’t mind having them.

So here’s what you do…

🧵/22

First, you want to add value, so don’t just offer contactless menus, but the ability for contactless ordering too.

For this you have a couple options…

🧵/23

You could build out a Messenger chatbot flow that gives people the opportunity to peruse the menu and order through the bot (this is labor intensive and you will have to teach yourself how to build chatbots)

Or

🧵/24

You can use a codeless app creator platform (such as Appy Pie but there are many). Most have a restaurant menu order template.

Then just go to local restaurants (or cold call) and pitch a branded contactless menu order system that will capture customer contact info.

🧵/25

Charge a setup fee as well as monthly maintenance and boom. You could make thousands off one restaurant.

🧵/26

#6 Biz ad support

So many businesses don’t have a clue how to do anything online.

You could easily do simple things like “get a business on Google” just by setting up their Google My Business account.

Or install their Facebook and Google pixels on their website.

🧵/27

All that stuff is super simple to figure out so even if you don’t know how to do it you could look it up and learn quickly.

🧵/28

#7 Courses

I’m not talking about creating some massive multi thousand dollar course on how to trade options.

No…but if you know how to do anything SUPER WELL you can record lessons on how to do it and put them up on Udemy and Skillshare.

🧵/29

These smaller platforms typically only have courses ranging from $10 to $80. But they get TONS of traffic.

🧵/30

#8 Resell books

Books are different from other products in that they retain value so long as all the pages are intact.

I know several people who make a killing reselling used books on Amazon and eBay.

🧵/31

You simply look for cheap book opportunities. Thrift stores, clearance sales, even discounts online.

Then post them at a markup on Amazon and eBay. Textbooks especially do VERY well.

🧵/32

#9 Calendars

I have a colleague that makes an absolute fortune selling calendars. He sells nude calendars but they do really well.

The secret was he took SO MANY PHOTOS that he got like 10 years worth of shots. So one photo shoot provided 10 yrs of calendars.

🧵/33

This one is a little tougher because you have to come up with the designs and find a printer. But it’s worth it.

Think about it.

EVERYBODY has a calendar.

🧵/34

Many things went digital over physical and have decimated those markets. But for some reason calendars wasn’t one of them.

🧵/35

#10 Templates and presets

Photoshop presets are a huge business on Etsy.

I know someone who tried hard to make a business out of empty journals but struggled. Then she switched to selling journal templates for entrepreneurs who want to sell on Kindle and is crushing it.

🧵/36

This requires you to have done the work to create the presets or the design for the template. But if you have you can sell digital planners, tshirt templates, excel budget templates, and more.

🧵/37

Ok ten is all I got in me today.

If you found these helpful or they got your creativity working SHARE THIS THREAD.

Go to the first tweet and QUOTE TWEET IT and share which idea interested you the most.

Cheers mfkers
🧵/38

Side Hustle Ideas

I know I’m still kinda new to #Defi #crypto #finance (under 1yr) BUT I got some other expertise

I’ve:
Sold almost $1mil in product on Amazon
Sold 10’s of thousands in info products
Sold hundreds of thousands in consulting

So here’s a thread on making $$ in a bear market

🧵/1

Here I will lay out all the ways I’ve made money (all of them) as well as a couple ways people I personally know have.

I’m not sharing theory here. These things have put money in my or people I know’s pockets.

Let’s get it…

🧵/2

Selling on Amazon -

By far the most profitable endeavor, but also the most expensive and labor intensive.

There are LOTS of ways to sell on #Amazon but I chose to create my own brand of product.

I know that sounds kind of hard BUT I did it with zero money (starting out).

🧵/3

Here’s what I did:

I chose a market to serve.
I researched the needs of that market.
I chose a line of products that would serve that market.
I found suppliers on Alibaba.com that make those products.
I designed a brand and logo.
…
🧵/4

…
I negotiated branded bulk orders with the Alibaba suppliers.
I paid using credit cards (that I had JUST opened up a month prior).
I started an LLC.
I opened a pro account on Amazon.
I got my step-dad to take photos of the product.
…
🧵/5

…
I did competitor research and determined the best keywords.
I wrote an SEO friendly Amazon listing for my first product.
I turned on Amazon ads (still putting everything in the credit cards).
I ran a couple of promotions.
I sold $25,000 worth of product the first month
…
🧵/6

…
I expanded the product line with more products and variations.
I started a sub-brand under the parent brand.
I introduced a different niche of products.
I got to the point where I was ordering 40ft HQ containers of product every other month.

🧵/7

Obviously it’s easier said than done and there’s more to it than that but those are the basics on how I sold hundreds of thousands of dollars on Amazon.

But there are other ways to make money on Amazon.

🧵/8

I have a good friend who is a consultant/wholesaler that does $6 to $10 million a year.

Here’s how.

He started by scrolling through Amazon. He found crappy listings for great products.

He reached out to the brand.
…
🧵/9


…
He told the brand he could “fix” their listing (increase conversions, get more sales, etc) for a *hefty* fee.
OR
If they give him wholesale prices he’d sell the products himself.

Now he has a team that does this for him.

🧵/10

I’ve also made great money selling info-products.
Here’s how…

First, I mastered a topic.

Again, easier said than done. But almost everyone has enough interest in at least one topic to be well versed on it.

🧵/11

True story I knew of a guy who was making $15k a month selling instructions on how to build a chicken coop.

Just about everyone knows enough about a topic that somebody is willing to pay you for what you know.

🧵/12

And if you really don’t, you can always go learn.

Anyway, so I had mastered how to rank on Amazon at this point.
So I wrote a book.

You’re probably thinking “I can’t write a book.”

But I have a HACK…

🧵/13

… Get a speech-to-text software and just speak your knowledge and expertise.

Then give the text to an editor. This is literally what I did.

I spoke the words into a program called Dragon Naturally Speaking. Then I had someone else copy edit.

🧵/14

Later I decided books took to long to write so I created SOPs (standard operating procedures).

I built a sales funnel and sold these in PDF format.

These info products generated $$10’s of thousands.

🧵/15

I know someone who makes money selling info products with NO INFO.

These are called “low content.”

They are:
Notebooks
Sketch pads
Calendars
Planners

Many of these were not even professionally designed, but made in Canva.

🧵/16

I’ve also made a lot of money consulting.
Again this is because I mastered a skill.

But honestly mastery may not even be required.

You just have to be a few steps farther along a journey than other people and they’ll typically be willing to pay you for help.

🧵/17

I’ve had mentors set up consulting clients for me, I’ve had my peers refer others to me, and I’ve been hit up in DMs by strangers looking for help.

All this happened because of ONE activity. ..

🧵/18

…I would go online and answer questions.

I answered questions on Reddit, on Quora, on Facebook, in niche forums. Everywhere.

Funny thing is the answers weren’t even always correct.

It didn’t matter though. I was being helpful and I established myself as an expert.

🧵/19

These consulting gigs landed me job opportunities as well. All amounting to very good money.

And all I had to do was prioritize being helpful and answering questions.

🧵/20

Other, smaller things I’ve done to make extra money:

Taught myself how to build Manychat chatbots and sold them.
Taught myself how to build no-code automations in Integromat and sold them.

🧵/21

All total I’ve generated over $1million with little to no startup capital by teaching myself new skills and then ultimately sharing what I’ve learned.

🧵/22

So if you’re looking to change your economic status then my advice is to:

Find an in-demand industry or skill.
Learn how to master that skill or serve that industry (YouTube is your friend).
Illustrate your expertise by being helpful and answering questions.

🧵/23

If you like this, I got TONS of ideas for side-hustles I’m happy to share.

ALSO if you found this helpful please retweet the first tweet. Twitter been trippin on my distribution lately.

RETWEETING REALLY HELPS

cheers mfkers

🧵/finis

A bit about me

Ok, I know it's been awhile since I've done a thread...and a lot of you are probably gonna wonder why the heck I'd do a thread on THIS...but, lemme 'splain.

I was very actively looking for a job in Web3 and putting my resume EVERYWHERE...

🧵/1

...and one of the companies I applied with was #Tron.

This prompted me to look deeper into it, since I'm a really big fan of functional L1's and currently the #defi space has left me jaded on ponzi protocols with no real utility.

🧵/2

And look, Tron is actually a pretty huge player, especially in Asia. Anyway, so for anyone that maybe hasn't cared to look deeper into $TRX and Tron, here's a thread.

(And if you think the chain is dead no worries, you don't have to read this, lol)

🧵/3

First, let's start off with some facts.
My interest in Tron actually didn't START with the job application.

It started back when I was doing research on $FTM and comparing txns per day to $ETH.

🧵/4

Ya'll remember when the #fantomfam was posting about how #fantom had more txns per day than #ethereum? As if Ethereum was the standard.

When I dove deeper, I discovered that Tron actually wins in that department.

🧵/5

Tron has, as far as I can tell from my research, the most daily transactions. Just in the last three days it's processed over 6mil txns EACH DAY.

That's more than #BSC, #Solana, etc.

🧵/6

Also, according to tronscan, Tron has 12.1 billion TVL.

@DefiLlama puts it at 5.6 billion, but either way, that's still #2 in TVL, just below Ethereum.

🧵/7

Tron's got a 5.6 billion mcap according to @coingecko.

If you take that figure and use tronscan's 12.1 b TVL figure, then the ratio is 0.46. Remember, less than 1 is GOOD!

🧵/8

Time to finality is 3 seconds, and Tron network processes 2000 TPS.

Also, there are a little over 100mil accounts on Tron network, putting it at roughly half that of Ethereum.

By all accounts, Tron is a major L1 contender.

🧵/9

Despite this, it has only about 568 dapps compared to 2800+ on Ethereum or 3k+ on BSC (or 37k on Polygon)

With so few protocols, this may be one of the reasons many people don't utilize Tron network

Be that as it may, there is currently more $USDT on Tron than Ethereum
🧵/10

So what exactly IS Tron?

Justin Sun (Tron Foundation) founded Tron in 2017 as a means to decentralize media. The initial aim and interest for Tron network was to cut out middlemen and give users direct access to content and media from their creators.

🧵/11

This aim is what motivated Tron’s acquisition of peer-to-peer file sharing service Bittorrent.


🧵/12


Tron’s architecture is very similar to Ethereum’s. It has it’s own virtual machine TVM, which is EVM compatible, and even runs smart contracts written in Solidity.

The striking similarities have also caused others to accuse Tron of plagiarism.

🧵/13

Tron utilizes a 3-layer architecture: the core layer, which handles txn validation and reading smart contracts (among other things), a storage layer for blockchain and state storage, and an application layer.

🧵/14

Where Tron differs from Ethereum greatly (until recently) is the consensus mechanism, which uses Delegate Proof of Stake.

🧵/15

Protocols on Tron:

Sunswap
JustLend
Tron Bank
ApeNFT
more..

They cover the whole gamut: wallets, lending, borrowing, staking, liquidity providing, NFTs, gaming, etc.

🧵/16

Since Tron is more focused on entertainment, it has attracted a focus in the dapps built on the network centered around gaming and gambling primarily.

🧵/17

So why isn’t Tron more popular?

Justin Sun has a shaky reputation having gotten much press over alleged pump and dump schemes, among other things.

🧵/18

Tron also held its popularity primarily in Asia, which given the difficulty in the region with regulation regarding crypto may have stifled Tron “moving over” to the US at a quicker pace.

🧵/19

Who knows if Tron will inch out ahead of some of the recent innovative contenders. But either way, Tron devs are still building, and the network is still being used.

Time will tell what it's future is.

🧵/20

A Thread on Tron

👉WUT THA HELL IS A ROLLUP?👈

A delicious dried fruit snack....duh.

OK, just kidding. Let's talk about #rollups in the context of #blockchain technology, shall we?

🧵/1

Today we'll be talking about #optimistic rollups and #zkrollups.

For those of you interested, I did a thread on ZK (zero knowledge) proofs recently too 👉 https://twitter.com/RobotDefi/status/1554921810809876480?s=20&t=HChxitpHkRml4ymuzKmrrQ

🧵/2

But first...what exactly is a rollup anyway?

Well, in simple terms, it is a scaling solution.

Scaling solutions have been born to address the slow and expensive finality of transactions on many proof of work blockchains (primarily #Bitcoin and #Ethereum).

🧵/3

Basically, Ethereum is mad slow and mad expensive because there's a ton of traffic and transactions being processed.

If we could rollup a bunch of those txns outside of the Eth chain, compress that data, and then send it in as a single txn, it'd be way faster and cheaper.

🧵/4

Rollups settle a portion of the txns on a separate (i.e. faster) chain (L2) then rolls them up to communicate necessary txn data to the main chain

This is a smart contract that pushes computation & state storage (bulk of the work in a txn) to L2 then submits txn data to L1

🧵/5

So, to recap:
Rollup moves computation & state storage off chain. Txn data is sent to mainnet as calldata (lower cost of storage). 

Txns are batched and sent in one txn to reduce fees & speed. 

🧵/6

TADA! That's a rollup baby.

OK, so now that we understand that...wtf is an Optimistic rollup, or a ZK rollup?

Well...those are two of the most prevalent rollup technologies, here's what they do:

🧵/7

Optimistic Rollups -

Optimistic rollups assume all the txns in the rollup that is sent to the main chain are valid and not fraudulent. They are essentially automatically trusted.

Hence the name Optimistic.

But...wait...so how do you prevent fraud?

🧵/8

If all the txns are trusted as valid without proof, couldn't anyone just send fake txns into the rollup?

This is why there is a "challenge period" which is a period of time in which network participants can challenge txns by submitting a "fraud proof"

🧵/9

Within the challenge period of typically a week to two weeks, network members (i.e. nodes) can submit a fraud proof to prove a txn is not valid.

In that period, and before any challenge period is over, the txn data is NOT finalized on the main chain.

🧵/10


Optimistic rollups use a sequencer to compress data and submit it as a batch to main chain

Sequencer sends pre-state root & post-state root where contract verifies post-state root matches current state

Txns are final after they go through challenge period uncontested.

🧵/11

How the fraud proof works – 

Node initiates challenge with their version of the post-state root. The txn is replayed in a sandbox. If the results match the challenger’s state root, then it’s proven the sequencer published an invalid state transition.

🧵/12

Fraud prevention on Optimistic rollups relies on economic incentives. Everyone involved has tokens staked. If a sequencer (who submits the rollup to the main chain) is found to have submitted invalid txns, the sequencer's stake is slashed.

🧵/13

The same penalty exists for challengers as well, to prevent submitting invalid fraud proofs.

This incentivizes honest behavior.

🧵/14

The major advantage to Optimistic rollups is that they are EVM compatible. This means any smart contract code written to run on Ethereum doesn't have to be modified. It can just be copied onto the rollup chain

Also Optimistic rollups can deploy smart contracts on Ethereum

🧵/15

The major disadvantage to Optimistic Rollups is obviously the challenge period. Having to wait a period of a week to as much as two weeks (if no challenge is submitted) for txns to clear can be not ideal.

🧵/16

ZK Rollups -

ZK stands for zero knowledge, and ZK Rollups do not optimistically assume all txns are valid. Rather, they implement a cryptographic verification process that determines the validity of the txns.

Then a validity proof is submitted to the main chain. 

🧵/17

The ZK smart contract uses public numbers strings to conclude if someone's txn is valid. A cryptographic process determines, based on these strings, whether the txn submitter is acting honestly.

Once the txn is verified it's added to the rollup.

🧵/18

Then the rollup is submitted to the main chain as a validity proof.
The chain excepts this txn data immediately as their validity has already been proven. That means there is no challenge period.

For this reason ZK Rollups offer more TPS.

🧵/19

Further, data compression in ZK's are greater than Optimistic rollups because all state data doesn't need to be included in a validity proof.

However, ZK Rollups are exceedingly complex which poses challenges for developers as well as cost-savings.

🧵/20

Until recently, ZK's were also not EVM compatible, meaning code between a ZK chain and main chain had to be altered (however zkEVM is a recent development).

For this reason, ZK Rollups were considered superior for token transactions only.

🧵/21

Optimism was preferred for general purpose EVM computation.

zkEVM will give ZKP's more use-cases, however, leading to what many think will be the inevitable future domination of zero knowledge proofs over rollups.

🧵/22

Ok, that's awesome, but when the #Ethereum merge happens, and ETH moves from POW to POS, will scaling solutions like rollups even be necessary?

The Merge actually won't impact scaling solutions at all. It's SHARDING that will.

🧵/23

However, sharding is likely to merely grow in tandem with side-chains, rollups, and other scaling solutions.

Further, as crypto gains mass adoption and other L1's experience congestion, scaling solutions will prove useful on other chains.

🧵/24

What Are Rollups (and How Do They Work)?

0️⃣ WHAT ARE ZERO KNOWLEDGE PROOFS? 0️⃣

Since I started falling down the #DeFi and #blockchain rabbit hole I've been intrigued by Zero Knowledge (ZK Proofs).

So let's talk about it 👇

🧵/1

The tech encapsulates all that is #crypto in my opinion. Passing on knowledge (authentication, etc) without passing on THE knowledge.

But how?!

🧵/2

The point of ZKP is to prove that one possesses knowledge without revealing information. 

Basically, proof that one HOLDS information without giving that information.

🧵/3

There are two parties involved in a ZKP: 

The prover and the verifier. 

The process of proving is interactive between the parties and typically consists of challenges where the answers to such convince the verifier that the prover possesses the knowledge.

🧵/4

A zero-knowledge proof of some statement must satisfy three properties:

1. Completeness: if the statement is true, an honest verifier who is following the protocol rules will be convinced of the fact by an honest prover.

🧵/5

2. Soundness: if the statement is false, the probability is incredibly small that a cheating prover will be able to convince an honest verifier that the statement is true.

🧵/6

3. Zero-knowledge: if the statement is true, the verifier doesn't learn anything except that the statement is true. No other information is conveyed.

🧵/7

There's actually a pretty popular paper that attempts to explain the concept to children. Let me summarize that story here...

Imagine a cave shaped like a ring (or a donut if you prefer). The mouth of the cave opens to a fork that goes left and right (but not straight).

🧵/8

There is a partition at the back of the cave that can only be opened with a magic word.

If you don't have the magic word, if you go down one side of the cave, you'll hit a dead end and have to come back.

🧵/9

In the story, a prover claims to know the magic word but doesn't wish to share it.

So a verifier allows the prover to go into the mouth of the cave, then follows them in and yells out which side of the cave he wishes the prover to come out from.

🧵/10

Obviously if this is only done one time, there's a 50% chance the prover went down the same side the verifier calls out and won't need to actually know the magic word and open the partition at all.

🧵/11

However, in the story, the verifier calls out sides of the cave at random and the exercise is repeated 40 times, diminishing the chances that the prover was lucky and already chose the proper side to an immensely small number.

🧵/12

By the end of the 40 iterations, the verifier had no choice but to concede that the prover, in fact, knew the magic words to get through the partition in the cave.

🧵/13

"Cool story bro...wtf does that have to do with crypto?"

Well, now that you understand what ZKP can do, let's talk about HOW it works...

🧵/14

The HOW really depends on the application. ZKP's have been experimented with since the 80's, but they have found particularly effective use cases in blockchain.

One such example is $Zcash and their use of ZK-SNARKs.

🧵/15

Zcash launched using ZK SNARKs (which stands for zero knowledge succinct non-interactive arguments of knowledge).

This bit of technology utilizes complex mathematical computations to determine knowledge from a series of public information.

🧵/16

In fact Zcash's launch was a dramatic display of creating it's SNARK's parameters using secure multi-party computations, which involved six individuals across the globe generating only fractions of public and private keys.

🧵/17

Another, more recent and popular utilization of ZKPs is #Ethereum and #ZKrollups.

ZK rollups (in an incredible oversimplification) create txns outside of the L1, then apply a cryptographic test. Once txns are verified it provides a Proof of Validation to the L1.

🧵/18

Ok, the HOW is a bit technical. But are rollups for faster transactions and private money movement the only things ZKPs are good for?

Not at all. The future implications of the technology are impressive to say the least.

🧵/19

First, ZKP's could potentially offer private authentication.

Imagine KYC without KYC. Authenticating your identity without making your identity known to any living parties.

🧵/20

As real-world assets become tokenized, we can also imagine a future where real estate ownership takes place on-chain.  ZKPs could also offer private income verifications.

Getting a loan or a mortgage without having to reveal your income...only prove whether you qualify.

🧵/21

And speaking of loans...currently crypto loans require at minimum equal collateralization (and most of the time over-collateralization).

 This is because, since crypto is trustless, there is no such thing as credit.

But ZKPs could change that.

🧵/22

Remember, at it's core, #crypto has aimed at offering anonymous and secure transactions.
Privacy has always been an inherent expectation.

If privacy is important to you, then you can see why ZKPs are a revolutionary concept in #blockchain.

🧵/23

What Exactly Are ZK-Proofs?

⚡SCOPE OF FINANCIAL INSTRUMENTS AVAILABLE IN CRYPTO & #DEFI⚡

You may recall last week I wrote a 🧵about tokenized derivatives (==> https://twitter.com/RobotDefi/status/1547631170929627136?s=20&t=H-eVLJFLrs_3hEfTQW70QA)

That was me scratching the surface of the available financial markets on-chain.

But the rabbit hole goes deeper 👇
1/23

Diving deeper 🤿, while there are still so many instruments that I believe should be tokenized and on-chain, there are so many others that I didn't realize existed.

Let's take a look at the wonderful world of Derivatives & Financial Instruments on the blockchain

2/23

Most  traders/investors are already familiar with the "spot market."

The spot market is where financial assets are traded "on the spot" for immediate delivery. This is currencies, commodities, cryptos, etc.

3/23

When you go to a CEX to buy $ETH, for example, that's the spot market.

Many exchanges, however (both CEX and DEX) also offer margin trading.

Margin trading is, essentially, where you borrow some of your position balance to make a larger trade.

4/23

For example, let's say you have $500, but want to buy $1000 worth of $BTC. You could buy that $1000, putting the other half of that purchase "on margin"

This means you'd borrow the rest of that position, giving you access to greater rewards if the trade becomes profitable.

5/23

Margin trading is risky, as the downside is also multiplied, but this is a financial instrument many institutional and experienced tradfi traders use to maximize gains.

Not recommended for newbies, but can be incredibly lucrative for advanced traders.

6/23

Derivatives: Futures

Another awesome financial instrument is the Futures Contract. A futures contract is essentially a contractual agreement to buy an asset at a predetermined price at a specified time in the future.

But what does that mean in the crypto world?

7/23

It means that, for most traders who do not hold a futures contract until expiry, you can trade cryptos without taking possession of the underlying asset.

But why would you want to do that?

8/23

For starters, it makes it easier to get in & out of positions quickly without waiting for on-chain transactions (usually it takes a minimum of 10 minutes for your $BTC to hit your wallet).

However, #crypto #futures have other advantages

9/23

Most exchanges that offer crypto futures also allow you to trade them with leverage (i.e. margin trading).

This means that you can choose anywhere from 2x to 10x to as much as 100x leverage, so for every dollar BTC moves, it's worth $100 (for example).

10/23

This is the biggest advantage to trading futures and the reason why tradfi futures traders make so much money (but also lose so much).

Futures are definitely a "big boy" financial instrument, and several CEXs and DEXs offer them.

11/23

Derivatives: Options

An Options Contract is a contractual agreement to potentially buy an asset at a pre-determined price at a set time in the future

For a premium, you can choose to NOT exercise the option, or in the case of American style, you can exercise it early

12/23

Options are a bit more complex and often used as hedging instruments, but definitely a tool in the tool belt of experienced tradfi traders.

13/23

Derivatives: ETFs

Exchange Traded Funds (ETFs) are basically a basket of assets (it can track indices, sectors, etc) much like a mutual fund...except it's traded like a regular token on the spot market.

14/23

For example @kucoincom offers ETFs that are comprised of "leveraged tokens." These are baskets of tokens that represent, typically a 3x, position in the cryptocurrency.

This allows traders to take advantage of leverage without trading on margin.

15/23

Derivatives: Perpetuals

Perpetual Contracts (Perps) are futures contracts that don't expire. These carry a premium as well (much like options) but they offer the convenience of not having to worry about closing positions before expiry, or taking ownership of the asset

16/23

Derivatives: Indices

Indices (Indexes...and specifically their futures contracts) are a standardized tracking of a basket of assets.
For example, the S&P 500 is an index, and offers futures contracts.
As is/does the NASDAQ 100 and DJIA

17/23

In crypto, indices can be any number of tracked assets that allow the investor a broader range of exposure.
The advantage of investing in an index is, ideally, lower volatility while taking advantage of the trend of an entire sector.

18/23

These are the types of complex financial instruments that are available to crypto traders today, illustrating just how much crypto and defi level the playing field for investors and traders.

19/23

You don't need to be an accredited investor (requiring upwards of $1mil)
You don't need a broker or manager to execute these trades for you

You don't even need a large amount of capital for collateral, as most tokens offer fractional investment.

20/23

Such is the power of the blockchain and digital currencies.

For those interested, here is a list of platforms I found that offer the previously mentioned financial instruments:

Kucoin (@kucoincom) - Spot, Margin, Futures, Perps, ETFs
dYdX (@dYdX) - Spot, Perps

21/23

Gains Network (@GainsNetwork_io) - Margin, Perps
Scalara (@Scalara_xyz) - Indices
Hegic (@HegicOptions) - Options
Synthetix (@synthetix_io) - Perps, Forex
GMX (@GMX_IO) - Perps
Dopex (@dopex_io) - Options

22/23

Scope of Financial Derivatives On-Chain

🗣️🕫 One of the biggest opportunities for mass adoption of crypto is Tokenized Derivatives 🗣️🕫

What are Tokenized Derivatives?

Let's discuss 👇👇

🪡/1

Many derivatives in the crypto markets are already tokenized. Let’s define both separately first:

What is tokenization?

Basically it’s turning an asset (digital or physical) into a token on the blockchain (in THIS context).

🪡/2

Technically tokenization is turning sensitive information into a non-sensitive token. 

We’ve actually been doing this since the 70’s (turning credit card numbers in a computer database, for example, into a string of nonsensical numbers and letters…for example).

🪡/3

But in #crypto, it’s turning that asset into a crypto token, or rather, representing it on the blockchain.

But why would you want to do this?

🪡/4

1. Fractional ownership

If you tokenize a condominium you could issue 10,000 tokens representing 1/10,000th ownership in the condo property and then ownership would be split amongst anyone that owned tokens.

🪡/5

2. Security

All transactions take place on the immutable, transparent and traceable blockchain. This also offers less points of failure.

🪡/6

3. No intermediaries

Traditionally, valuable assets, such as real estate, require several “middlemen” and mountains of paperwork, adding significantly to time and cost. With blockchain secured transactions, this would no longer be an issue.

🪡/7

4. Permissionless

Tokenization democratizes asset ownership so terms are dictated by the code in the token contract and not by a centralized power.

🪡/8

This process can be done with real world assets, such as real estate, as shown in the example. 

It can also be done with traditional financial instruments, such as futures contracts, options, debt, etc.

🪡/9

A great example of this is Paxo Gold (PAXG @PaxosGlobal) which is a token backed by gold.

🪡/10

What is a derivative?

A derivative is mostly exactly what it sounds like:

Something that derives its value from something else.

🪡/11

To explain more clearly, in financial markets, a derivative represents a contract that derives its value from an asset or group of assets, like stocks, bonds, commodities, currencies, etc

These contracts are then traded as financial instruments for hedging or speculation.

🪡/12

When I say many derivatives are already tokenized, I mean things like crypto futures contracts. 

Nowadays there are several crypto options available on derivative markets (like @MEXCDerivatives which offers perpetual futures for an insane amount of tokens). 

🪡/13

When I say Tokenized Derivative I am referring to derivatives that exist in traditional finance markets that haven’t been (or didn’t start as) tokenized yet.

🪡/14

These are things like copper futures or foreign currencies. 

@synthetix_io is a great example of a protocol that offers tokenized derivatives, as it offers foreign currency trading on the blockchain.

🪡/15

Ok, now we know what tokenization is, what derivatives are, and what tokenized derivatives are. Why are we talking about this?

Because this represents a tremendous opportunity and likely the direction of crypto and #Defi in the future.

🪡/16

See, there were 62.5 billion futures contracts traded in 2021.

Logically, not all of those trades came from farmers, but many speculators as well. That means there is a large population of traders who use real money to trade futures contracts.

🪡/17

Crypto futures is a great start and represents an amazing step forward in the advancement of #blockchain-based financial markets.

In fact, $BTC and $ETH futures contracts accounted for $32 trillion in trade in 2021!

🪡/18

Now, while we consider ways to draw normies or institutional investors over to crypto, imagine if we could woo futures traders.

🪡/19

And I believe synthetic assets (“real world" assets that have been tokenized, including tokenized derivatives) is the way this will happen
When we can offer synthetic E-mini S&P 500 futures, or Pork Belly futures, we’ll see even more people bringing their trades on-chain.
🪡/20


TLDR:

- Tokenization turns assets into tokens on a blockchain
- Derivatives are financial contracts that derive their value from an underlying asset
- Synthetics are asset representations on a blockchain (i.e. tokenized derivatives)

👉 We need synthetic CME futures!

🪡/21

If you learned something, found this entertaining, or agree with the sentiment of this thread....please consider retweeting!

Also, follow the Defi Robot for more musings.

Cheers mfkers

🪡/finis

What Are Tokenized Derivatives & Why Are They Important?

🧠BRAIN HACKS FOR BETTER INVESTING🧠

See, we always learn about our biases that interfere with good decision making (like this awesome thread by @thedefiedge: https://twitter.com/thedefiedge/status/1490765231248838661?s=20&t=Dvhic2pZazC1C2lUkzTk5w)

But what about how you can boost brain power for making GOOD choices? Let's discuss 👇

🧵/1

For context, in my real life once upon a time I wrote a book (attempted to write a book...it was actually a word omelet) on cognitive enhancement.

But that isn't why you should listen to me, because that would be a logical fallacy called "argument from authority"

😂

🧵/2

Okie Dokie, let's get into the brain boosting:

1. Learn Faster.
The next question is probably...HOW?

First, you must identify the mode of learning that works best for you (auditory, visual, reading). Then, you can use technology to get the info into your brain quicker.

🧵/3

If you are an auditory learner, you can download an app like Speechify, which is a text-to-speech app. You can upload books, whitepapers, URLs, etc into it and a voice will read the text out loud.

What's more, you can also increase the speed setting.

🧵/4

The Chrome extension "Read Aloud" also does this for you on the web. It will read whatever web page or PDF you are looking at, and you can adjust the reading speed as well.

For auditory learners, you can learn at 1.25, 1.5 or even 1.75x speed!

🧵/5

If you're more of a visual learner, then take advantage of Youtube's feature (in the video player settings) that controls playback speed.

For all other players, on PC there's the Chrome extension "Video Speed Controller" that allows you to control speed on any video.

🧵/6

If you prefer to read, then you'll want to leverage Bionic Reading. This converts text to strategic partial bolding that helps eyes recognize letters faster.
You can convert text on their web converter here: https://api.bionic-reading.com/convert/

Or use the app Reeder 5.

🧵/7

2. Optimize Comprehension

Consuming information faster is only one slice of the cognitive pie. You also want to optimize your brain's ability to "digest" this info.

Do this with a learning hack - read/study/learn for 20 minutes, then do a physical task for 10.

🧵/8

Switch back and forth between study and physical (exercise, sport, whatever) every 30 minutes. 20 min study, 10 min physical.

You'll rapidly move through even the most complicated subject matter without the need for much repetition.

🧵/9

3. Nootropics

Otherwise known as "smart drugs" this is essentially chemically induced clarity or focus.

There are many herbs and vitamins that are mainstream nootropics: lions mane, cordyceps, B vitamins, etc.

🧵/10 