6/6: Summary: Always Ask This Question

Before you LP:
"Do I actually want to hold these assets?"

If no → don't LP, regardless of APR
If yes → check correlation, then consider yield

Underlying Asset > APR
Every single time.

Next up: "V."

The foundation matters more than the rate.
Don't chase yield. Chase quality assets.

#CryptoAZ #DeFi #UnderlyingAsset #LiquidityProviding #ImpermanentLoss #LST #ETH #Uniswap #Onchain

5/6: The Pro Mindset: "Stack, Don't Speculate" 💎

Smart LPs choose underlying assets they want MORE of.

Example:
- stETH/ETH LP → compound your ETH stack
- USDC/USDT LP → stable, predictable, low IL
- wBTC/renBTC LP → accumulate BTC

Strategy is the tool. The asset is the treasure.

4/6: What Makes a Bad Underlying Asset?

Low correlation = high impermanent loss.

Example: $ETH / Random-Governance-Token
ETH pumps 50%. Token dumps 80%.
You end up selling your ETH, holding worthless tokens.

"I would've been better off just holding ETH."
Classic mistake.

3/6: What Makes a Good Underlying Asset?

Two things:
1. Assets you actually want to hold long-term
2. Assets with high correlation (low impermanent loss risk)

Example: $wETH / $stETH
Both are ETH. Both move together.
You're not betting on ratios — you're stacking ETH.

2/6: The APR Trap

"This pool has 500% APR!"

Cool. But look at what you're LP'ing:
- Random governance token + ETH?
- Meme coin + stablecoin?
- Token with no real utility?

APR is the bait. Underlying Asset is the catch.

8/8
Conclusion (NFA)
At ~12–13% expected yield, backed by observable revenue and high stake commitment,
TCY looks more like an on-chain dividend asset than a typical DeFi play.

Paired with something defensive (e.g. stable yield),
the risk/reward profile actually makes sense.

Yield is paid in RUNE, so price volatility matters.

7/8
The big takeaway
TCY isn’t:
❌ fixed APR bait
❌ inflation-driven yield
❌ reflexive ponzi mechanics

It is:
✅ real protocol revenue
✅ variable but explainable yield
✅ aligned long-term incentives

6/8
Usage isn’t flashy — and that’s a feature

・Daily active users are modest
・But THORChain serves native BTC/ETH/SOL swaps
・Revenue spikes during volatility

This is infrastructure usage, not retail hype.

5/8
Why the dashboard APR (~3–4%) looks “low”
That figure is:

・Short-term (7d window)
・Sensitive to RUNE price
・Snapshot-based, not normalized

Annualized expectations ≠ weekly noise.