**By reading this you agree that nothing written here is financial advice**
I get the question all the time from new DeFi Kingdoms players. If it’s just an individual it will sound something like “which hero should I buy?” or “should I be in the gardens or the bank?” If it’s a HNW or a fund they ask about my capital allocation strategy. The principles are the same, but the complexity does differ quite a bit based on who you are and how much capital you’re allocating. With that in mind, this article is about picking the structure that’s right for you and understanding the reasoning behind the strategy.
BTW — If you’re new to DFK you might also want to check out my other articles on what DeFi Kingdoms is and why I’m interested, and the early primer on how the gardens work.
Allocating $10k (or less)
If you’re just dipping your toes in the water and you don’t want any long-term commitments I recommend starting off by purchasing some Jewel from the marketplace using ONE tokens and simply putting it in the bank. The reason is that you’ll start earning passive interest on your funds right away and you can exit any time you want to with no penalty. Plus, at today’s price you’ll be able to purchase about 1,326 Jewel, which means you’ll even be in line for some Crystal airdrops in the near future.
Now you have a choice to make. Are you comfortable leaving your funds alone for at least thirty days? If the answer is “yes,” then you should take about 80% of those Jewel and deposit them in the gardens.
The last question you need to think about is your risk tolerance. If you’re out there on the risk curve then there are gardens paying a premium such as MIS and 1SUPERBID. I’m not highly knowledgeable on these projects, so you’ll have to do your own research if you are interested in using these instruments. If your risk tolerance is slightly lower, consider the JEWEL-ONE garden. If you’re still more risk averse, the JEWEL-1USDC pool is a safer play.
It should be noted that at the time of writing, the difference between the pool that is probably the least risky is paying 253% APR while the other end of the spectrum is paying 400% APR. Position accordingly.
Optional Path — Buy a hero
The heroes in DFK make the game more interesting and complex. But they require more time to research, understand, and actually use. Heroes can gain levels and become more powerful over time, but they will tend to become less useful if they are purchased and then never used. Heroes are denominated in Jewel, but their price is much more complex since each one is unique.
If you want to try out questing, I would recommend buying one or two heroes to see how this works. The hero can have any profession you like, but since you just joined the game I would steer you away from mining since those heroes cost more and at this point you have very little or no locked Jewel so these heroes are not the best bang for your buck now (the primary purpose of mining heroes is to unlock locked Jewel).
If you want to buy a fishing hero, for example; I would visit the DFK Tavern and look at what makes a good angler.
What you’re seeing here is a breakdown of which heroes are the best at each profession. In the “fishing” column you will see that luck and agility are the fishing stats and the top five fishing classes are Ninja, Thief, Sage, Dragoon and Pirate in that order. So let’s go to the Tavern and see what’s for sale.
In the Tavern you’ll want to talk to the NFT Agent and select “Buy Heroes.” Then on the left hand side check the boxes for the top fishing classes as shown.
Oh, make sure to use the Beta sight because it has the APIv6 upgrade and runs much faster. The link is in the description above.
Now, click on the attributes tab and select “fishing” in the professions area and then hit apply. The results you will see are “class-aligned” fishing heroes which means that they will continue to be good at fishing as you level them up. If you have a hero that’s not class-aligned they will never be the best at what they do.
So now we have some results. Let’s see what’s for sale today!
Now the “floor” is the cheapest hero up for sale that meets our criteria. Today that floor is 52 Jewel. But how do you know if that hero is a good buy? Well this is where it gets complex and I’ll have to save that conversation for another article. But for now, you can use this technique to identify candidates for purchase.
Instructions
Visit the gardens once per day and click on the “Harvest” box. Collect your rewards and deposit them in the bank. If you want to compound your returns you can reinvest each day. But be aware that the gardens have slashing fees for exiting within a short period of time.
If you exercised the hero option, visit the profession area every day (up to three times a day if you want to maximize your rewards) and send your hero(s) out to collect their rewards.
Allocating $100k
Check you out, baller! $100k, w00t! The good news is that there’s not too much different between allocating $10k and $100k. So if you read the section above then you already know what to do. The only twist here is that you probably want to get a few more heroes, which will require a bit more research. I would recommend having a few heroes from each profession so you can collect rewards (which are all cryptos btw) and increase your daily Jewel income.
The more capital you allocate to DFK, the more important heroes become and I’ll explain why. One of the biggest updates coming is the Kingdoms and Buildings expansion. This means you’ll have the ability to purchase your own land and actually develop it. However, the game designers don’t want people purchasing these lands and just sitting on them. They want the lands to get used to make the game more interesting.
Therefore, Kingdoms will only be available to purchase for active players and those leveling up heroes (according to the devs). So if you think you might want to participate in this then heroes are necessary. Also, the quests you can do now are level zero quests. There are new zones coming with greater rewards. But you also won’t be able to do those quests unless you have heroes at the necessary level (10 perhaps?).
Lastly, there will be guilds and PvP coming which will be intimately related to Kingdom ownership. I heard you might need a Kingdom in order to make a guild for example, but I have not verified this info as of yet.
So keep that in mind and allocate your time and money accordingly.
Allocating $1mm
Wow, $1mm USD! You could have started your own McDonald’s franchise but you chose DFK instead, that’s amazing. But what now?
Well for starters you’re going to need to think seriously about purchasing some more expensive heroes, namely some Gen-0s. These heroes can summon an infinite number of times and they are the most desirable “empire building” heroes for a few reasons. Take a look at this next chart and let’s ponder the implications.
The heroes at the bottom of this stack are the “basic” heroes. All the Gen-0 heroes come from this stock. But notice that guy up top with the giant sword, the Dreadknight? That hero is the rarest class and is extremely valuable. Many people would love to have one of those, but of course they’re very rare and expensive.
So where do Dreadknights come from? They have to be summoned into existence. In fact, only a Dragoon and a Sage can summon a Dreadknight. But where do Dragoons and Sages come from? Dragoons can only be summoned by Paladins and Darkknights, but each of those comes from the base classes.
With this in mind, it’s worth seriously considering a pair or possibly two pairs of heroes that can summon an advanced class. By this I mean, you might want to purchase a G0 Warrior and Knight. Or, a G0 Archer and Thief for example. The reason is that you can now summon those advanced classes which can summon elite classes and so forth.
With $1mm USD you can purchase about 133k Jewel at today’s price. The G0 floor is about 4k Jewel, so the starting point for a G0 summoning pair is about $60k (more if you want legendary G0s).
But using this pair you can now summon new heroes into the game every three days. These heroes can be used to grow your kingdom, to try for more advanced classes, or simply to sell in the Tavern.
At this point it’s probably worth mentioning that when you own a large number of heroes or you have a significant hero allocation you should start to learn as much as possible about hero mechanics. For example, a random warrior and knight have about a 15% chance of summoning a paladin. But if the recessive genes are aligned on both heroes, then the chance jumps up to about 20%. So how do you see these recessive genes? Enter the Kingdom.watch site.
This excellent site is one of the many you’ll want to bookmark in order to optimize your experience in DFK. I have drawn two boxes in this image, the red box and the green box. The red box is where you click in order to look up a hero by their ID. The green box is where you see the recessive genes of the hero. This particular hero is famous, hero #1. This hero is a mythic G0 Thief. But you will notice that the R1 “main class” box says “Pirate.” This hero does not have a recessive match on their R1 gene that matches their class. The other recessive genes (R2 and R3) matter as well, but they are less important due to their statistically reduced role in summoning.
Instructions
Much like the previous sections, allocating $1mm USD is similar in many ways. The main difference comes from the fact that you will want to use your G0 heroes to summon every three days and you will need to understand how to price the new heroes that you summon so you can sell them for a fair price in the Tavern.
Collect your rewards from the garden every day, quest your heroes, and summon when you can. Also, remember that heroes need to level up when their XP bar gets full. That is something you do at the Meditation Circle.
But be aware, when you level up a hero you have to choose the correct stats to advance or you can make your hero less desirable. See below.
This google sheet is very handy for selecting which stats to advance. As you can see, stats are ranked from green, to yellow and then orange. Always increase the green stats first and work your way down the list. This particular tab is showing the stat priority for a paladin. But if you look at the bottom of the page, there are other tabs. Those other tabs are for the other classes, priest, archer, etc. Make sure to check this spreadsheet when you level up and double check you have the correct class selected.
Allocating $10mm+
Only $10mm? Disappointing. All your friends are swinging $100 bucks or more. You are actually the lamest person you know.
But don’t worry, we’ll get you into that country club with everyone else in no time at all, with this one simple trick!
The main difference between $1mm and $10mm is probably just how many G0 heroes you have. I would recommend one of each type so you can create your very own Dreadknight factory. Additionally, try to focus on mythic and legendary heroes and consider how to optimize for airdrops.
For example, when you get your kingdom in the upcoming land sale you’re going to need lots of peasants to work the fields. Start now by leveling them up for this hard labor in the future. I recommend having a couple full complements (6 or more) for each profession, and enough heroes to work around the clock on mining and gardening. This means having probably 18 miners or more and 3x the number of gardening heroes than the number of gardens you’re in.
Also, don’t even think about selling your locked Jewel balance. That’s for pedestrians. You’re in this for the long haul and that means capitalizing on the upcoming Crystal farm as soon as it goes live for ROI in the 10,000%+ APR range for the first week or so.
Afterwards, plan your approach for the next two expansions carefully and consider partnering with large guilds who can help you make important decisions about upcoming features.
Instructions
Be ready to pounce on upcoming expansions and be sure to create a spreadsheet to track upcoming airdrop rewards. Most airdrops will go to those with large bank balances, but some will go to hero owners and gardeners as well.
You’ll want to optimize your knowledge of the game which you can do by reading everything that Samichpunch and MrZipper write. If you don’t have the time yourself, hire an analyst to summarize the information for you.
Make sure you’re in the DFK Discord and attend the AMAs. Upcoming features can be very important so I recommend adding them to your calendar. Luckily there’s a handy link for this in the Discord channel #Community-Calendar which you can find on the sidebar.
Conclusion
DFK has something for everyone in the crypto space. Whether you’re an NFT nut, a DeFi degen, or just into retro gaming. I think the arc of this game could potentially span several years and consume market cap from decentralized finance and the metaverse as a whole (both are already valued in the billions).
The most interesting features of this project are yet to come, so remember to play the long game.
Feel free to reach out if you have any questions.
Cheers,
Hans HODL
