Introduction

With the election in the bag, it seems some market participants are scrambling for positioning in DeFi tokens. Overnight, a promise of more regulatory clarity, less fear of tokens being perceived as securities, and more doors opening for revenue sharing with DeFi token holders, among other possibilities, became reality. It’s become clear that the discount at which the market was implying both $BTC, as well as DeFi tokens, should be valued during the Gensler era of regulatory uncertainty was significant, as evidenced by the dramatic run-up in token prices in the days immediately following the election. While some might chase higher-beta plays, including smaller perps protocols with low-floats or others, we advocate for a position in an established player: $AERO.

Source: Kaito.ai | DeFi is one of the narratives that has seen a dramatic increase in mindshare following the election.

There has also been renewed discussion about turning on fee switches for DeFi protocols when there previously wasn’t much interest in these assets (often labeled as useless governance tokens, or “memecoins” dressed up in suits). We may be entering a time where more productive crypto assets can finally receive their fair share of attention as opposed to more speculative, flash-in-the-pan narratives and trends. If this is the case, as many have recently hypothesized, then $AERO is arguably primed to benefit the most, with no changes to its existing structure needed for this to happen.

Aerodrome was born alongside the launch of the Base chain, built by the team behind Velodrome, the initial successful ve(3,3) DEX on Optimism. Aerodrome has since proven itself as a winner in it’s own right, shedding any notion of dependence upon the initial Velodrome product and growing to become the dominant MetaDEX. The protocol serves as the primary liquidity hub and DEX on Base, a leader among L2s and chains in general. But Aerodrome’s success isn’t solely dependent on Base’s growth; the operating team has executed its vision and expanded to become the top protocol on the chain. For a time, the protocol, technically, was the fastest startup to ever reach $100M in revenue, doing so in just 11 months. Needless to say, Aerodrome is one of the top-grossing protocols in all of DeFi, boasting the highest revenues returned back to shareholders.

Source: Aerodrome Twitter | Aerodrome has accomplished all that it has without VC funding, something the team prides itself on.

Newfound interest from institutions and other market participants can potentially take the DeFi genre to new heights. The potential for a Grayscale DeFi fund is there, as they have outlined $AERO as an asset under consideration to incorporate into a fund. When sold to investors, the thesis is simple, as Aerodrome can be marketed as representative of revenue-generating businesses rather than something much more speculative.