🤔Is This The Time to Ditch Federal Banks For Olympus DAO’s Ohm?

Olympus DAO’s Ohm

Here are 5 reasons to believe so!

  1. First and foremost, the widely used fiat currencies are nothing more than a piece of paper. They lack intrinsic value and are printed recklessly as and when the government feels like doing it. There was a time when currencies were backed by precious metals like gold and silver and derived their value from these underlying assets. To put it simply, to print $100,000 worth of denominations the government must first put $100,000 worth of gold in their federal reserves. But, today this is not the case! For instance — between February 26th to June 10th of 2020, the US Fed printed and pumped $3 trillion into the economy from thin air. It did all this just by purchasing bonds from financial institutions and got away with it. The result? A tremendous loss in USD value! On the contrary, Olympus DAO’s ohm is backed by a basket of well-diversified crypto assets in the form of - DAI stablecoin(1 DAI = 1 USD), Ethereum, and others where DAI is the major backing asset. You can always be sure that regardless of the total circulating supply of Ohm you will be able to exchange 1 Ohm for at least 1 DAI from the Olympus treasury at any given point in time.
  2. Secondly, the minimum backed value aka floor price of Ohm doesn’t prevent it from attaining a value greater than that of 1 DAI its price can go well over the floor price. For instance — in the 2021 bull run Ohm was trading at its all-time high value of $1500/Ohm which was 1500X of its floor price. At the time of writing this article, it is being traded at $58 which is still 58X of its floor price. This means it is up to the market to decide what should be a reasonable price for each Ohm. Moreover, this arrangement results in a variable market price for Ohm based on market sentiments but a fixed floor price of 1 DAI to always fall back on. In case of an economic downturn, this floor price acts as a stopcock and prevents the Ohm from falling below 1 DAI. However, there is no fixed floor price for the fiat currencies meaning in event of a severe market crash, the fall in the fiat’s price can be pretty ugly as seen in the case of the Turkish lira.
  3. Thirdly, the annual compounded yields that are being offered by the Olympus v2 protocol on the staking of Ohm is a staggering 941%. Now, compare it with your bank’s petty 3% annual interest on your deposits.
  4. Fourthly, governments across the world are failing to run the economy profitably. Hence, to bail out their collapsing economies — arising from their incompetency they opt for easy debts in the form of bonds and ‘manufacture’ a desirable amount of money out of thin air solely based on these bonds. On the other hand, Olympus DAO has shown the world how to run a treasury profitably and efficiently. Currently, it has over $535 million locked in its treasury and makes over $200 million in annual revenues from its revenue sources like Olympus Pro, Liquidity Pools, Yield Farming, and Fee Sharing Agreements. What’s worth noting here is that this $200 million revenue is outside of its primary income stream of bonding and staking.
  5. Lastly, I feel too much centralization of power with the governments have made them go too far by daring to freeze the bank accounts of anyone who disagrees with their policies. The recent act of Justin Tredeau — the Canadian prime minister that involved freezing bank accounts of the protesting truck drivers reveals the totalitarian regime we are living under. It’s all nice and cozy until you dare to express your opinion. Hence, decentralization in the existing financial infrastructure is logical here like that with Olympus DAO which is totally governed by its community members' votes.

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Abhishek Ranjan

Abhishek Ranjan

Defi advocate| Web3 enthusiast 💻