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APR is Dead

From the desk of Juliun Brabon, CEO and Co-founder, Unifi Protocol

No one wants APR.

Not only does no one want APR, APY or Yield, those terms only serve to ostracize the greater blockchain community.

Year to date we have seen the complete collapse of user confidence in the DeFi space. Users are utterly disinterested in anyone trying to shill a dead fad that resulted in one of the greatest losses by a single industry. The ultimate dissolution of (several) unsustainable multi-billion dollar companies was the inevitable result of the mass hysteria around these terms. Today, a simple review of the search terms related to APR in crypto says it all.

APR + CRYPTO = SCAM

Public sentiment surrounding the blockchains sector’s (poor) ability to use the term APR has all but ruined market appetite for it. Impermanent loss, and complex derivatives remain impossible educational hurdles preventing wider adoption.

Public interest in these terms is waning.

Looking further, the DeFi market as a whole is decimated. What remains only further demonstrates the complete public disinterest in APR. According to DeFi Llama, less than 9% of the entire crypto market is participating in DeFi today. Considering the loose definition for “participation,” as well as the duplication of tokens and derivatives, it is likely far (far) less.

What remains of the DeFi market is sequestered in “non-DeFi” products. This refers to an overwhelming majority of TVL tied up in derivatives such as wrapped stETH (basically UP but with more risk), stablecoins, and ETH at absolutely pathetic yields.

The crypto world does not want risky APR.

They don’t want yield, a better way to earn money, a new rewards token, or even to participate as a basic LP. None of that.

They simply don’t want to lose money.

The few participating today are happy to earn any (measly) yield in stable pairs, because from their perspective… they’re taking on practically no risk.

The market needs to evolve, and we don’t have to look far for what’s coming. Sustainable, no risk, low yield. A “vanilla” savings account.

During the Great Depression, the largest banks in the world failed en-masse. Those that survived, did so by building on consumer confidence. They showed they had the funds to cover their account holders (by literally displaying it in their windows) and started offering products that did not subject their customers to unnecessary risk unless explicitly requested.

We at Unifi Protocol are working to create opportunities to get ahead of the market. You can and should be your own bank, but…why not consider opening a savings account too. Diversify a portion of your portfolio into a sustainable asset that doesn’t subject you to hidden risk, that you can feel comfortable holding long-term with minimal management. It may not make you rich overnight, but that’s not the purpose of a savings account.