Uniswap is about to stop mining, is the spring of SushiSwap coming?

Original title: "Sushi's Spring"
Written by: Lin Ming, co-founder of FirstPool

Uniswap is about to stop mining soon, and it will take about a week to restart. As the first lock-up project on DeFi, the locked-up market value exceeds 2.9 billion US dollars, which will have a very large impact on the entire DeFi. When judging the impact on the market, after investigation, it was found that Uniswap's chaotic period will bring a spring for its competitor Sushi. In previous articles, I have said that I am not optimistic about DEX and do not recommend everyone to get involved, but with the large drop in DEX, some real gold will appear after the bubble.

Sushi’s Token Model

The price of Sushi has experienced a very exaggerated drop. As the knight who challenged Uniswap, a unicorn, Uniswap once experienced a lot of pain due to excessive issuance and founder events. However, the Sushi community quickly reflected on it, selected 9 multi-signature members through public elections, established a core team, and modified the token model, fixing the total amount of Sushi to 250 million. The current circulation is about 152 million, from the original reward of 1,000 per block to the current reward of 80 sushi per block. It will decrease in the future, and 2/3 of them will be locked. The daily release volume is about 433,333, and the actual release volume after deducting the lock-up is about 144,444. According to the price of 1.2 dollars/sushi, the daily supply is 173,000 US dollars, while UNI generates a daily supply of 1.28 million US dollars. In addition, Sushi has established a repurchase mechanism and repurchased about 1.7 million US dollars of Sushi. It can be said that Sushi’s token model has generated a new supply and demand relationship through continuous adjustments in market declines.

Sushi Market Cap Analysis

According to the total amount of Sushi of 250 million, the circulation volume of 152 million, the total market value of 300 million US dollars, and the circulation market value of 182 million US dollars, compared with UNI, UNI has a total amount of 1 billion, a current circulation volume of 200 million, a total market value of 4 billion US dollars, and a circulation market value of 800 million US dollars. The price of Sushi has been falling from 15USD, a very exaggerated drop, until the price of 0.48USD rebounded to 1.2USD. It can be seen that most of Sushi is locked in, and the cost is very high. Too low a price is not attractive to most funds.

Sushi Profitability Analysis

Sushi achieved a trading volume of approximately US$3.387 billion, which brought about US$10.16 million in revenue to platform participants. 5/6 of it, or about US$8.47 million, was allocated to liquidity providers; the other 1/6, or about US$1.7 million, was allocated to xSushi owners after repurchasing Sushi. The annualized fee income is about 60 million. If 0.3% of the fee is used as profit, the total market value PE is 5 and the liquid market value PE is 3.03. If 0.5% is used as profit, the total market value PE is 30 and the liquid market value PE is 18.18. It can be seen that Sushi's cost-effectiveness is very prominent.

Transaction Amount

Number of traders

Sushi also has excellent data in terms of trading volume and number of users. We can see that Sushi's trading volume and number of users are firmly ranked third among DEXs. With the influx of Uniswap funds, slippage will be more friendly, and it is not ruled out that Sushi will have better ranking changes.

Sushi lock-up analysis

Sushi's locked-in value has gone through a process of peak to trough and then rebound. The locked-in value is an important indicator of DeFi. Sushi has experienced a process from a maximum of 1.42 billion US dollars in locked-in value to a low of 240 million US dollars in locked-in value. However, in the past week, with the suspension of Uniswap mining and the rebound of Sushi prices, the rebound trend is very obvious, directly rebounding from the low point to 350 million US dollars.

Sushi Roadmap

• Limit Order. The beta version of the limit order has been released by the development team Levx on the lightweight UI lite.sushiswap.fi. It is currently under testing and awaiting audit by a professional organization. No transaction data has been generated yet.

• Bento Box. Bento Box, a lending product that is highly anticipated by the community, has been basically completed thanks to the efforts of the developer BoringCrypto and has entered the stage of testing and waiting for institutional audits.
  Moonbeam. The community has passed an initial proposal to attempt cross-chain deployment to Polkdot and Kusama, which is expected to be advanced by the end of the year, at which time moonSushi tokens will be airdropped to the SushiSwap community.

• Gusoku. SushiSwap has contacted external teams and plans to introduce options hedging and stop-loss tools to develop Gusoku, a product that reduces the impermanent loss of liquidity market making, which may increase the willingness of funds to enter the market.

• MISO. Minimal Initial Sushi Offering, will incentivize new projects to launch tokens on the SushiSwap platform.
  It can be seen that the Sushi team is very pragmatic, and the roadmap direction is more in line with public expectations. At the Uniswap community meeting, Sushi's general manager 0xMaki said that once Uniswap V3 appears, Sushi will use it as soon as possible. Although the team still relies on copying Uniswap, it can be seen that it is very down-to-earth and pays more attention to the project itself.

Impact of Uniswap mining suspension

The most significant event in DeFi recently is the suspension of UNI mining. 2.9 billion US dollars of funds will face new choices, and the best choices for trading pair migration are undoubtedly Sushi and Balancer. Uniswap is about to enter a chaotic period, which is the biggest benefit for Sushi. The uncertainty of Uniswap is precisely the certainty of Sushi. It is certain that funds will migrate from Uniswap to Sushi. The greater the uncertainty of Uniswap, the higher the amount of funds migrated, and the more friendly the transaction slippage of Sushi will be, which in turn promotes trading volume. The appreciation of Sushi prices promotes the increase of locked positions, thus entering a positive cycle.

With the resumption of Uniswap mining, Sushi will be in a weak position again, but a currency that has reflected on itself too much will definitely not have a bad future.