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The U.S. March unadjusted CPI year-over-year dropped to 2.4%, down from 2.8% last month and below the 2.6% market expectation. While this signals cooling inflation, the market reaction has been muted.
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Lily Liu on RWA assets: valuable but not priced
Recently, the chairperson of the Solana Foundation, the often bold Lily Liu, rarely discussed RWA seriously on her Twitter account.
She mentioned on Twitter:
Most RWA are valuable but have no price because they are not traded.
Cryptographic native assets (in extreme cases, memecoins) have a price but no value.
Cryptocurrency, as a global financial infrastructure, needs to have a comprehensive range of assets and risks.
The best point is that assets have value and price, and on-chain stocks may be the best example.
RWA is a type of asset that has historically been subject to regulatory restrictions and licensing limitations, making it non-tradable. Therefore, the value is low for both the issuers and the blockchains that issue them.
Given the nature of assets (such as housing mortgages), most RWAs do not actually trade on their own. Instead, their main role in the on-chain economy is to serve as collateral, allowing users to borrow stablecoins.
Having stablecoins means you have economic power.
In addition to making this comment, Lily Liu also discussed many issues with users.
A friend asked about the feasibility of using RWA as collateral, considering that the transaction frequency of houses or office buildings is not high, but their underlying value will still change. How high must the collateral ratio be to attract lenders?
Lily Liu does not believe that on-chain loans will take the route of over-collateralization; rather, lower collateral ratio short to medium-term loans may be more suitable for on-chain.
Some people believe that not all RWA are the same, especially if the yield can compensate for the risk, such as holding stablecoins backed by Brazilian restaurant debt. But let's not pretend it is as safe as those backed by U.S. Treasury bonds.
In this regard, Lily Liu believes that the differences in RWA are enormous, and this term is an abbreviation for the 100 trillion dollars in traditional finance.
The scope of asset quality, risk, liquidity, and turnover rate is very broad.
Most of them do not trade, not because of the liquidity situation on the chain, but because of the fundamental nature of the assets.