MARKETPEOPLE

Venture Capital Partner Adam Cochran's 10,000-word encryption paper Chapter One: Legendary Projects

share
Venture Capital Partner Adam Cochran

Cinneamhain Ventures partner Adam Cochran has released his 2022 crypto thesis and his favorite projects across various sectors, dividing them into seven categories. This article covers the first chapter: God Tier projects.

Original link: https://twitter.com/adamscochran/status/1476652328736342023.

  • 1. God Tier projects: ETH, YFI, CVX, KP3R
  • 2. Outperforming the market/key catalysts: FLX, CRV, ALCX, BAL, ZRX, FXS, RBN
  • 3. Outperforming the market + top farms: FTM, AVAX, ZEC, Gearbox, Euler Finance
  • 4. Value-driven/long-term outperformers: MKR, HNT, LDO, COMP, RARE, SNX, SYN, GNO
  • 5. Medium risk, clear potential: PERP, FST, CAP, MCB, DPX, HND, API3, ANGLE
  • 6. High risk, 50x or bust: GEL, NFTX, RAMP, THALES, PICKLE, BABL, PREMIA, PENDLE
  • 7. Promising: Cowswap, Element Finance, Opyn, Cozy Finance, Pods, Volumex

Before delving in, Adam Cochran emphasized several key points, including protocol revenue, cash flow, and infrastructure as key factors for project selection, along with:

Advertisement - Continue scrolling for more content

1. Portfolio: These are projects he believes may outperform BTC in 2022, but it doesn't mean he buys all tokens at once. Buying on dips remains a priority. There is no perfect portfolio, and readers shouldn't evenly distribute investments across all mentioned projects. Taking a value investment approach, he is willing to hold projects for over five years with a 60%-70% failure rate and the potential for losses for up to three years.

2. Some quality projects are not on the list: He gives the example of Solana, which had a great year last year. While it may continue to rise in 2022, it is unlikely to outperform the market. There are also many projects with top-tier technology not on the list because 2022 may not be their time. The public often underestimates the time needed for a project to build and increase adoption.

3. Inclusion criteria:

  • A feasible product.
  • Having catalysts for potential success in 2022.
  • Room for growth compared to competitors.
  • Having external cash flow is a plus.

Table of Contents

God Tier Projects

These four projects are Cochran's top picks for 2022. He believes that these projects will outperform the market and maintain strong performance, claiming that he will buy, forget, and hold for up to ten years.

Ethereum ETH

Cochran considers this a no-brainer, having previously mentioned that ETH 2.0 will drive a significant economic cycle. As the merge approaches, the rallying cry for Ethereum will be even louder in 2022, surpassing Bitcoin.

With the growth of scaling solutions, the burning of Ether in EIP-1559, and the merge to 2.0, the long-term returns for Ether will be hard to beat, outperforming any mainstream asset.

yearn.finance YFI

Cochran references his previous analysis of YFI, for the article please see.

Convex Finance CVX

Cochran has been bullish on CVX for a long time, calling it a significant DeFi catalyst. While he did not previously include CVX in the list, he now believes that it will maintain a strong upward trend in 2022 for the following reasons:

  1. Votium Bribes: Growing faster than expected, the market has validated its model's feasibility.
  2. Curve V2: Due to the bribery mechanism, V2 will capture the majority of AMM trading volume for new projects.
  3. Convex will continue to expand beyond Curve, see cvxFXS for details.

Cochran plans to continue locking and staking CVX at around 50% APY and a 2.4 bribery-to-vote ratio. He believes CVX could double in value within the year, and given the rapid market expansion, an 8-10x increase over the next few years wouldn't be surprising to him.

For CVX, Cochran only plans to relock CVX weekly and delegate it to Votium.app. Based on the current return rate, even if CVX drops by 50%, he can offset it with the APY earnings.

Keep3rV1 KP3R

Points of interest:

  • One coin gains two protocols.
  • FixedForex is essentially Andre Cronje, Yearn founder, creating a Curve for the forex market.

The traditional forex market has a daily trading volume of $6.6 trillion, and FixedForex is attempting to capture market share. Due to pain points in traditional payment mechanisms, FixedForex has the potential to change the game.

Another speculation by Cochran is that CVX will eventually start devouring KP3R at some point, similar to how CVX consumed FXS, adding compounded value to both.