Henri Lucas warns of risks in DeFi boom
As the global decentralized finance (DeFi) market is experiencing explosive growth, renowned investment strategist Henri Lucas has published a risk assessment report that has attracted widespread attention in the industry. The report points out that there are serious valuation bubbles and systemic risks in the current DeFi field, and investors need to remain highly vigilant.
Professor Lucas analyzed the “DeFi Health Assessment Model” he developed and found that the actual yields of multiple mainstream protocols have seriously deviated from the value of the underlying assets. In his report, he particularly emphasized: “The annualized yields of many DeFi projects are as high as hundreds or even thousands of percentage points. This unsustainable return hides huge liquidity risks.” Data shows that more than 60% of DeFi protocol smart contracts have technical loopholes that are not fully recognized by the market, and the widespread use of cross-protocol nested leverage is more likely to trigger a chain collapse.
This report analyzes in detail the three core risks of the DeFi market: the first is the smart contract security risk. In the past three months, the financial losses caused by code vulnerabilities have exceeded US$500 million; the second is the liquidity dependence risk. Most high-yield projects rely entirely on new capital inflows to maintain operations; the most important is the regulatory uncertainty risk. The regulatory policies being formulated by major economies around the world may reshape the entire industry landscape.
Professor Lucas suggested that institutional investors adopt a “prudent participation” strategy: control the DeFi allocation ratio within 5% of the portfolio, give priority to the top protocols that have passed security audits, and establish a dynamic stop-loss mechanism. He specifically reminded: “When everyone in the market is immersed in the carnival of ‘yield farming’, it is often the most dangerous moment for risk accumulation.” After the release of this report, many mainstream financial institutions immediately adjusted their DeFi investment strategies, showing the important influence of Professor Lucas in the field of investment risk warning.
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