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Slow day

Markets were down all day, so today was a chance to catch a breather.

So the Yearn.Finance ETH vault went live earlier today, and I managed to stake a small position plus another twenty dollars in gas fees. Apparently they’re depositing the funds in Maker, using it as collateral for a DAI loan, then depositing that on Curve, earning CRV tokens, selling those which goes back to the ETH pool.

I’m comfortable with these little 2% experiments and consider it as a sort of tution. Unchained covered why DEXs are taking off in this latest episode, and they really break things down quite well. It’s worth a listen.

I’ll admit I didn’t get a lot done today, I stayed up too late last night and got woken up too early by the kids. They were quite a handful today and it was tough trying to get some work done while nursing the lack of sleep.

About the only thing I did do was re-opened a position in $ZRX.

This isn’t ideal, considering that I just stopped out this position less than a week ago, but I want to explore picking up positions on the TD #9, before it closes. I’m still trying to flesh out the “rules” about how I’m going to set stops on these positions. Damn Binance and the lack of decent trailing mechanisms. I’ve got a lot of work to do to code these things up.

Using my Google Sheet trade calculators has become very cumbersome given that the CryptoFinance module that I had been using for price feeds no longer works. I had built custom API lookup scripts for some of the smaller markets in my mining portfolio, but it’s just too cumbersome keeping those together between various sheets. So I think the time is nigh to convert those over to some sort of Python program, maybe with a web front end.

I’m not sure how much work that’s going to be, of course.

All of this DeFi madness did get me to pick up Mastering Ethereum, which I started reading through today. Things seem to have come quite a ways since I tried experimenting with things a while back, now they have a online IDE that lets you compile, deploy and test smart contracts on a local JS node. It’s pretty handy, and the whole thing is pretty damn handy.

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Market updates

September is starting off with a bang.

$BTC was up to $11.9k this morning and has been edging on either side of $12k all day, but most of my attention was on ETH and DeFi tokens. I entered positions in Horizon ($ZEN) and Grayscale’s Ethereum Trust ($ETHE).

DPW Holdings

I started a value averaging protol with DPW Holdings ($DPW) back in June of last year. I believe they were on a list I pulled together for autonomous or aerial vehicles or something and is one of those stock pics that I threw a minimal amount of capital at without too much thought. Within a week they went from a dollar to six, and I thought I was a damn genius. It fell right back down, thankfully I sold some during this and a subsequent spike in mid-July. The protocol ended early last month, and my position is a bit underwater, but it’s less than half a percent of my total portfolio.

DPW Holdings

I set a contingent order to set a trailing stop should the price exceed five dollars. It’s my first time doing this with my brokerage, but I think I’m going to be putting them to use in the future.

Horizen

Horizen came up in my notes yesterday while I was feeding off of CryptoPanic. I was looking a running a node, actually, but discounted the one percent returns on the “Secure” node as weak, while the capital required for the 14% APR “Super” nodes as too steep. And mining the coins seemed completely out of the question as well. Still, the ticker price was trending as a nine on the TD Sequential for most of the day, so I broke out my trade calculator and took out a two percent position.

Horizen ($ZEN) chart

The price recovered after my order, so the nine actually turned into a one by close, so that might actually make a good strategy. My stop is set at the last entry signal, and I’ll raise the stop if it hits the exit target.

Grayscale Ethereum Trust

I’ve been heavily invested in Grayscale’s Bitcoin Trust ($GBTC) for at least a year or more, and right now it makes up about a fifth of the holdings in my managed IRA. And while I hold a special place in my heart for Ethereum, I’ve refrained from participating in Grayscale’s Ethereum Trust ($ETHE), mainly due to the insane premiums that have been attached to it since it was made available through my brokerage.

Since all the madness in DeFi and yield farming has taken off, ETH has become extremely lucrative, jumping to the top of the mining calculators over the past couple days. I switched my rig over last weekend, and at last check I’m making close to three times mining revenue than I was six months ago. And while the price of ETH has risen four times since last March’s lows, ETHE’s premium over NAV (the ratio between actual assets and number of shares,) is actually at the lowest level in a year.

The ETHE premium (ETHE/ETHUSD/NAV; NAV = 0.0934346 ETHE/ETHE) on the candlesticks. ETHE (falling) in blue, while ETH (rising) in red.

To me this seems like the best time to enter into an ETHE position. There’s not a lot of chatter about it on Twitter, but I did find the following thread which thinks that the premium could go even lower, and the price down to $40. Given what’s happening in DeFi right now, I don’t think it’s likely, especially given that price computes below NAV, but I set a stink bid regardless and opened a small position (0.5% capital) before the end of the day. Taking these nominal positions relieves my FOMO and gives me some breathing room.

https://twitter.com/JonathanZafar/status/1299460592173027330
https://twitter.com/JonathanZafar/status/1299460592173027330

It’s just crazy to think that just back in June, ETHE was $220, ETH was $240, and now ETHE is $60 and $ETH is $470. I’ll scale in from here and keep an eye on the premium. The closer things go to NAV, the better a deal we’ve got here.