Hotpot Fund V2 Weekly Report NO.25
Welcome to the 25th weekly report of the Hotpot Fund. We will continue to output the project’s operation and technology development progress for you, hoping to help you understand the first-hand market dynamics and better Defi investment decisions.
NO.8.23-NO.8.29
Revenue Performance （Last week）
Although the currency price was in a sideways state last week, the fee continued to grow, and the total user income broke a new high. As of last Friday, Hotpot Fund V2 has earned $108456 for users with a return rate of 17.68%.
Among them, the deterministic fee was $41103, accounting for 37.89% of the total income, an increase of 6.64 percentage points from the previous week.
Operation Section
A week ago, we explained the difference between the hot pot fund and the machine gun pool. Many friends said that they have learned new knowledge. So in this issue, we will explain the issue of “Impermanence Loss” that everyone is very concerned about.
The concept of impermanent loss is derived from the liquid mining project represented by Uniswap. When some ordinary users hear this term, they will mistakenly believe that the investment of funds into the Uniswap liquid pool will cause losses. Hotpot Fund V2 is a directional investment Uniswap V3, so many users think that the problem of impermanence loss can not be avoided by entering the hotpot fund. In fact, the term “impermanent loss” has long been over-interpreted by many media, which is very misleading to users.
The impermanence loss only occurs under certain conditions: when the price of the currency rises faster than the rate of return on Uniswap’s liquidity, then Uniswap’s liquidity pool cannot increase but the currency is held.
But what everyone tends to overlook is that if the currency price drops into the liquidity pool, the advantage is that it can reduce the decline. If the currency price increase is lower than the liquidity rate of return, it is still more profitable to invest in the liquidity pool. Once liquidity gains are added, losses can be hedged when currency prices fall, and gains can be thickened when currency prices rise. None of the above situations will produce the so-called impermanence loss.
In our view, impermanence loss is just a theoretical loss or a “happiness trouble”. Those media that slander liquidity investment projects and blindly encourage users to hold coins do not consider users’ actual band operation capabilities. After all, it is a very difficult decision for users to choose the correct selling point during the process of holding coins.
No one knows the results of the long-distance running of the two options of currency price and liquidity gains. Some people are willing to choose to be firm currency holders, while the Hotpot Fund would rather choose a definite result. There is no right or wrong here, just different choices.
In the future, the Hotpot Fund will use real and proud income data to make users who have been following us more determined in their choices!
Tech.Section
Hotpot Fund V2 has been in operation for nearly five weeks, and the technical team has recently focused on daily system operation and maintenance.
Hotpot Fund：Let the professionals handle professional issues！Please contact us for more details.
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