Buy Alert: Compound (COMP) and 0x (ZRX) By Teeka Tiwari Dear Reader, As you know, Coinbase, the largest crypto exchange in the U.S., went public recently. It ended its first trading day with an $86 billion market cap. That makes Coinbase larger than many household names in the financial services industry, including CME Group, Discovery Financial, and our portfolio holding Intercontinental Exchange (ICE), the operator of the NYSE. I believe we will look back at Coinbase going public as the “Netscape moment” for crypto. Back in the 1990s, Netscape developed a user-friendly web browser called “Netscape Navigator.” You didn’t need to know anything about computer code to use it. And it allowed anyone with a modem to surf the internet with ease. After Netscape went public in August 1995, the internet exploded in popularity. By the end of 1996, the number of internet users had skyrocketed to 36 million – an increase of 125%. Five years later, the internet had a half-billion users. Just as Netscape’s IPO brought the internet to everyday folks’ homes, so too will Coinbase’s public listing make crypto a household term. But Coinbase is just the beginning. The best opportunities this year are in a different corner of the crypto market… It’s called decentralized finance, or DeFi for short. You see, Coinbase is a centralized exchange. While it makes it easy to buy, sell, and store cryptos, it has its pitfalls. The two largest are its high fees and the risk of letting Coinbase custody your assets. That’s where DeFi comes in. Under DeFi, platforms like exchanges are decentralized. They allow users to trade cryptos at a fraction of the cost... and maintain control over their assets. This new realm of finance serves its users better by removing the middleman from the equation. For example, when you purchase stocks from your broker, they earn a fee. But without having to go through a middleman like a broker, the seller keeps more profits for themselves and the buyer gets a more favorable rate. And I believe 2021 is the year the DeFi trend goes mainstream. Over the past year, we’ve seen hundreds of DeFi projects come to life that have built an entire ecosystem of financial products. These new platforms are set to disrupt the financial industry we know today as they remove intermediaries and barriers to entry, which will also lower costs. DeFi is set to improve areas like lending, borrowing, trading, insurance, asset management, and much more. And as crypto adoption becomes more mainstream, so too will DeFi as everyday users realize the advantages it has over traditional finance. I expect DeFi to evolve into a multi-trillion dollar sector. And yet it’s still flying under the radar of most investors. So we’re adding two cryptos to our portfolio today to help us get ahead of the crowd… and position us to capitalize on the DeFi trend as it goes mainstream this year. I’m sending this alert now because I want us to get into these positions today, before they move any higher. We’ll cover them more extensively in the June issue of The Palm Beach Letter, which will be dedicated to the massive DeFi trend ahead of us. DeFi Pick No. 1 Our first DeFi addition to the portfolio is Compound (COMP). It's one of the largest decentralized lending protocols in the world... with nearly $10 billion in assets held on the platform. Compound allows users to borrow against their assets and/or lend them to earn income. The platform is completely permissionless, meaning anyone in the world regardless of their wealth or credit score can use it. Compound pools depositors’ assets together – which borrowers can draw from. This evenly distributes risk and rewards among depositors looking to earn interest on idle assets. An algorithm on Compound sets interest rates. And it automatically adjusts them to reflect market demand. For instance, when borrowing demand rises, rates increase to attract more lenders. And when borrowing demand drops, rates decrease to attract more borrowers. Unlike centralized institutions, Compound uses smart contracts to ensure optimal security and allow users to retain control over their assets. (A smart contract is a self-executing contract with the terms of the agreement between parties directly written into lines of code.) A depositor can withdraw their assets from the lending pool at any time of the day, 365 days a year. And since Compound runs on the Ethereum network, it doesn't need to hire thousands of employees or rent expensive downtown office space. This allows it to operate at a fraction of the price, passing on more profits to depositors and more favorable rates to borrowers. Adding Compound to the portfolio today will position us to ride the DeFi trend higher. And as more assets flood the DeFi space, COMP token holders stand to benefit from users looking to generate income or take out a loan with their assets. Action to Take: Buy Compound (COMP)
Buy-up-to Price: $1,500
Stop Loss: None
Buy It On: Coinbase, Gemini, Binance, or Uniswap
Store It On: MyEtherWallet
DeFi Pick No. 2 The second DeFi addition to the portfolio is 0x (ZRX) 0x is a decentralized exchange (DEX) aggregator. It works to find the best price for users looking to swap assets. It does this by pulling liquidity from multiple DEXs on the network. This saves users from having to search through several exchanges to find the best place to trade an asset. Even if they were up to the task, by the time they found the best price and entered the trade... prices would have likely changed by then. This makes 0x the one-stop shop to exchange assets on a decentralized network, such as Ethereum. Over the past 30 days, 0x has generated roughly $6.4 billion in trading volume leading to roughly $516,000 in profits for ZRX token holders. Monthly trading volume for the 0x protocol is up over 5,600% from the year prior with plenty of room for growth ahead. By adding 0x to the portfolio today, we’ll benefit from the rise in DEX trading. And as you can imagine, a decentralized exchange to swap assets is a critical piece to the DeFi ecosystem. Action to Take: Buy 0x (ZRX)
Buy-up-to Price: $3
Stop Loss: None
Buy It On: Coinbase, Gemini, Binance, or Uniswap
Store It On: MyEtherWallet Let the Game Come to You! Big T Mobile Notifications Palm Beach Research Group now has a smartphone app. You can use it to get instant notifications whenever we publish something new, access all your subscriptions, view portfolio pages, and more. To make sure you don’t miss any time-sensitive alerts, updates, or monthly issues, download the Palm Beach Research Group app for Android or iOS. This feature is available for international and U.S. subscribers and aims to send alerts instantaneously to all members. Make sure push notifications are enabled through your phone settings to receive alerts from the app. Important note about emails and text messages: We strive to deliver all of our alerts as quickly as possible. Due to the nature of email, SMS, and app notifications, we aren’t able to guarantee each user will receive our communications at exactly the same time. Deliverability depends on your location, your internet service provider, and internet traffic, among other variables. | | 
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