The yield farming airdrops have hidden the real story of sustainable value creation in defi: DEX fees from trading. Most of the borrowing activity is demand spurred from short-term promotions, but the shift of trading volume from CEXs to DEXs is real /1

2/ Uniswap’s ETH/USDT pair for example, at current rates, will generate about $75m in fees to liquidity providers a year. That’s wealth that was previously being siphoned off by exchange operators. In total, we’re talking $1b+ over the next year that doesn’t get “extracted.”

3/ only a tiny portion of this can be sustainably extracted by token holders, most will stay with liquidity providers (or a “white knight” will just fork out the token and liquidity providers will migrate to the platform that fully rewards them without the rent seeking.)