Discover the hidden secrets of DeFi and maximize your gains by spotting catalysts before others.
Hint: How to get information to help you identify catalysts early. Get ready to level up your investment game!
Outline
- What is Catalyst?
- The Catalyst plus how to get the information
- Rumors of Mainnet Launch
- Staking
- Airdrop Snapshots
- Token migration
- Partnership
- Conclusion
Fun Fact: I love Chemistry. I remember my lecturer told me that a catalyst alters the rate of chemical reaction. It can either speed up or reduce the rate of chemical reactions. It’s also related in DeFi.
What Is Catalyst in DeFi?
Catalyst in DeFi is anything that alters the demand and attention given to an asset. It could either be positive or negative, And there’re tools you could use to spot them.
The Catalyst
Rumors of Mainnet Launch
How can I explain Mainnet without talking about Testnet? No way!
Follow me as I explain it to you like I’m explaining to a 5yr old kid.
Imagine you and your friends want to build a big tower using colorful blocks. But before you build the final tower, you want to make sure everything works perfectly and there are no mistakes.
So, you decide to create two versions of the tower: the test tower and the main tower.
The test tower is like a practice version. You can build it, play with it, and see if everything fits together the way you want. If something goes wrong it’s okay because it’s just a test tower, and you can fix it easily.
Once you are happy with how the test tower looks and works, you take all the lessons you learned and start building the main tower.
The main tower is the real, official tower that you want to keep and show to everyone. It has to be perfect because you won’t be able to change it easily once it’s built.
In the same way, when the dev create new token, He first create a testnet. The testnet is like a practice version of the token.
People can use it to test and find any problems or bugs before releasing the final version, called the Mainnet.
The Mainnet is the official, real version that people will use for a long time.
So, the testnet is like the test tower, where you can experiment and fix things, while the Mainnet is the official tower that everyone sees and uses.
Now you know. You’re welcome!
How Is This a Catalyst?
When a token or chain is doing Mainnet launch, it gives the assurance that new projects would build on it or it would start a new revolution towards a new innovation. And that’s the advantages of Mainnet Launch.
How to Get the Information?
By searching Mainnet on twitter or with hashtag and you will see different Mainnet that may launch anytime soon.
Staking
Staking is the method used to reduce token in circulation, I.e. there would be increase in demand.
Some token might have a low supply but there’s no good demand. This might be because the token is not visible or people do not know about the utility of the token.
And it reduces the demand despite the low supply of the token.
Sometimes it’s not necessarily about the staking but about the greed factor. What does that mean?
Greed factor is something that can make people or lure investors to buy the token. Example is the APR you get when you stake your token. Imagine getting 70% APR. Staking is a good catalyst and when there’s a good greed factor, it makes it very good.
How to Get More Information
- Follow @FLS_News_1 to get latest updates on staking.
- Search “Staking” on twitter
Airdrop Snapshot
When a particular project wants to do airdrop snapshot, they will take snapshot of those holding the token at the time frame given. I.e. they take information of those holding the token and those people will be eligible for the airdrop.
How is it a catalyst?
People will also want to buy the token knowing that there’s an airdrop coming and also the quantity of the airdrop that would be given to those people that are eligible. And it leads to increase in demand of the token.
Token Migration
Basically, it means token moving from one chain to another. Probably the V1 is outdated they create another version by moving into another chain or by cross chain.
How to Get Information
- Check the Roadmap of the project if it’s updated
Partnership
Partnership tends to bring traction to projects especially if the partners have a track record of projects that have done well. It leads to increase in demand and growth.
Examples of partners to look out for：
- Binance
- Coinbase
Conclusion
You can position yourself early just on the rumor on any of these catalysts. “Buy the rumor, sell the event” because the news come with the event. When something is announced, the pump can last for a few days or weeks.
Next time you’re thinking and wondering which token to pick. Remember the power of catalyst.
Personal Note From MEXC Team
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