On bullshit in investing

Algorithmic stablecoins paying eye-watering yields had all the classic red flags. TerraUSD offered 20% returns on a coin pegged to the dollar (and therefore optically low risk), via protocols like Anchor or startups like Stablegains. The protocols ostensibly created revenue to pay this yield via lending out the funds to eager borrowers. However, th... See more

Understand this: yield has to come from somewhere. If you can’t understand in simple terms where yield comes from, what risk you are being compensated for bearing, then the yield is likely not sustainable. It rests on temporary venture capital subsidies or from inflows into the protocol from other investors. As the recent crypto crash reminds us, o... See more