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🦄 Recap: DeFi Week of Sept. 12
What a rollercoaster. We had screamworthy moments aplenty this week, and more than a few thrills, too. We were first to report 0xMaki was stepping down from SushiSwap leadership. On Tuesday we saw both Solana and Arbitrum experience outages. Brady Dale reported how bots pursuing a DEX offering appeared to be behind the Solana troubles. Then there was the case of apparent frontrunning at OpenSea, the titanic NFT marketplace, with an employee cited for exploiting inside info. The episode showed that for all the breakthroughs in DeFi, old habits like cheating die hard.
Then there was news that Aribitrum is growing at an exponential rate — Owen Fernau reported how the Layer 2 blockchain’s TVL has exploded 17 times in the last week, to $2.2B. Wow. At the same time, the zeal for airdrops is intensifying. Be sure to read the latest edition of Ape Diaries by yyctrader. It’s an invaluable primer on how to get in early on airdrops. The feature delved into some of the hottest drops so far this year and looked ahead to Arbitrum and Optimism. It was one of our most-read stories this week.
Likewise, Defiers wanting to learn more about the influx of fixed returns — the topic of a prescient research piece we published a couple weeks ago — and protection from exploits should tune into Robin Schmidt’s deep dives on our YouTube channel this week. The SuperMassive NFT show was uproarious. Speaking of NFTs, the space was awash in news — the focus was on the hack of Jay Pegs Auto Mart, an NFT project which allows holders to redeem tokens for Kia Sedonas. Meanwhile, hedge fund legend Steven Cohen led a $50M round in RECUR, a fascinating startup that’s building a royalty compensation engine for non-fungible tokens with a focus on sports content.
And don’t miss Camila Russo’s podcast with NFTfi’s Stephen Young. He provided valuable insights on the fledgling market for NFT-backed loans and the new DeFi financial service ecosystem. Your bonus piece: Brady Dale’s wonderful yarn about eBay’s rather inert strategy toward NFTs, a market the online auction giant should be embracing with fervor. Instead, it’s been kind of a non-event. Strange…
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Balancer, one of the leading DeFi automated market makers (AMM) for multiple tokens. Dive into their pools at https://balancer.finance/
Kraken, consistently rated the best and most secure cryptocurrency exchange, which can get you from fiat to DeFi
Aave, an open-source and non-custodial liquidity protocol where users can earn interest on deposits and borrow assets.
The DeFi Pulse Index, by Index Coop - DPI is the easiest way to capture the upside of DeFi with the benefit of diversification. Buy DPI today on your favorite DEX.
In this week’s episode Camila speaks with Stephen Young, the founder and CEO of NFTfi, a platform for enabling NFT-backed loans. For some people, decentralized finance and nonfungible tokens sit on two separate worlds; DeFi on one end with its different lending, boring, and trading applications, and NFTs, with their digital art, music royalties and collectibles. Entrepreneurs like Stephen sit at the intersection, with a platform that uses NFTs to provide a financial product.
In which Brady Dale plumbs the mystery of why eBay is approaching NFTs with the same timidity of retailers confronting the auction giant in the ‘90s…
NFTs are huge here in crypto, but the old web is not sure. Digital collectibles on the blockchain have captured the imagination of crypto heads and attracted hundreds of millions of dollars in investments. Players ranging from the Walt Disney Co. to Super Bowl champion quarterback Tom Brady are embracing their revolutionary marketing potential. Newcomers such as OpenSea and Rarible are rapidly expanding.
And then there’s eBay. The online auction pioneer has been hosting sales of NFTs on its site for several months, but don’t feel bad if that comes as news to you. In stark contrast to the buzz surrounding most NFT ventures, eBay has set about offering digital collectibles with the same vibe it brings to peddling used chainsaws, vintage jewelry, old toys or any of the other staples on its site since the ‘90s: Business as usual.
It’s barely even trying. The company has earned the trust of mainstream America and could rake in some very easy profits if it just tried to be a little crypto-credible in the way it’s running these sales. It’s not, though, and the quality of its efforts show in the quality of NFTs available on the site.
EBay investors should ask themselves whether eBay is going to side-eye blockchains until it’s too late.
In this latest edition of Ape Diaries, yyctrader provides an invaluable primer on airdrops, a timely topic given all the action around Arbitrum and Optimism.
It has historically paid to be early in DeFi — literally. Traders (including yours truly) are betting that will also be the case on Arbitrum and Optimism.
DeFi has long fostered a culture of rewarding early adopters, with a great example being last year’s massive Uniswap airdrop in which the decentralized exchange airdropped 400 UNI tokens to every user that had swapped tokens on the platform. Those who held onto the airdrop, worth $1,200 at the time, are now sitting pretty with tokens valued at close to $10K.
And while DeFi may have started on Ethereum, its explosive growth and resulting network congestion and high transaction fees have led to the rapid expansion of numerous competing Layer-1 blockchains, sidechains, and Layer-2 scaling solutions.
As these projects compete for users and liquidity, Defiers have a great opportunity to qualify for potential retroactive airdrops by interacting early with various protocols that have not issued tokens yet but may do so in the future. On September 10, users of the Ethereum – Avalanche bridge were airdropped $GB tokens worth $2K at the time.
0xMaki Is Leaving Leadership at SushiSwap to Take on an Advisory Role 0xMaki is stepping down from leadership in the community-run decentralized automated market maker, SushiSwap, to take an advisory role in the decentralized autonomous organization, a person with knowledge of the matter told The Defiant. A statement from 0xMaki will come out on Friday.
OpenSea’s Struggles Embolden Rivals with New Ways to Play Booming NFT Market The insider buying scandal at OpenSea has hit just as a crop of rivals are circling the NFT marketplace leader. On Sept. 15, a startup called NFTX launched what it called “the world’s most liquid decentralized marketplace,” meaning the exchange operates “on chain.”
Inside the Hunt for the Jay Pegs Auto Mart Thief and 865 ETH It took the team at Jay Pegs Auto Mart basically zero time to identify and find the hacker responsible for stealing the proceeds from their auction of DONA tokens on SushiSwap’s MISO platform Thursday night.
OpenSea Vows to Probe ‘Incredibly Disappointing’ Insider NFT Buys OpenSea, the world’s biggest NFT marketplace with $100M in daily volume, just learned a painful lesson — inside information can lead to unscrupulous trading by employees.
Solana Outage Likely Caused by Bots Pursuing an Initial DEX Offering At 2:01 AM New York time Wednesday morning, the Solana blockchain went live once again, according to @SolanaStatus. “The Solana validator community successfully completed a restart of Mainnet Beta after an upgrade to 1.6.25,” the platform reported. “Dapps, block explorers, and supporting systems will recover over the next several hours, at which point full functionality should be restored.”
XRP Holders to Get Huge Airdrop of New Blockchain Songbird Not only is DOGE a very good boy, its coin is about to be very smart, too — as in, smart contract-ready. Flare is a startup launching its canary network in the coming days, and it’s going to bring smart contract functionality to DOGE. It will also bring it to XRP, Stellar (XLM) and Litecoin (LTC), with more to come.
Cardano Launches Smart Contracts But Now Must Deliver on Ecosystem’s Promise At long last, Cardano has smart contracts. Input Output Hong Kong (IOHK), one of three companies backing Cardano, announced the release on Sep. 12 as part of the so-called Alonzo upgrade. The deployment means the end of a long wait — Cardano launched its mainnet four years ago but hasn’t been able to run decentralized apps (dapps) until this upgrade.
Solana Blockchain Suffers Intermittent Stability Solana, one of the biggest DeFi chains by value locked, suffered network outages Tuesday. The Solana team first alerted users to the issue on Twitter at 8:38 AM New York time, saying the network had been “experiencing intermittent instability” for the prior 45 minutes.
Ethereum Layer-2 Chain Arbitrum Suffers Near Hour-Long Outage Arbitrum experienced what its team is describing as an “outage” Tuesday morning, according to a Tweet posted by its main account at 10:43 AM New York time. The downtime happened to coincide with a similar loss of performance on the Solana blockchain.
Upstart Project Helps Drive Up Arbitrum’s TVL 17 Times to $2.2B Arbitrum, a Layer 2 which pushes Ethereum transactions onto a sidechain to enhance performance, is on fire (except for the temporary outage it suffered Tuesday). In the last five days, Arbitrum’s total value locked has multiplied 17 times, shooting to $2.2B on Sept. 14 from $126M on Sept. 9, according to data provider L2BEAT.
Billionaire Steven Cohen Goes Long in $50M Funding Deal for Sports NFT Player Steven Cohen, the billionaire hedge fund manager and onetime crypto skeptic, has jumped into the NFT market in a move that could shake up sports marketing, as well as the Metaverse.
The Founder of LOOT Wants to Throw Away the Keys to the Contract The founder of Loot wants to throw out his most magical item: the smart contract keys that govern the nascent game. “I worry that the contract owner is and always will be the de facto authority (‘the church’) on Loot, and that this will ultimately harm the project,” its creator, Dom Hofmann, best known for making the social video app Vine, wrote on the Loot governance forum.
Punks or Toadz? Referential Art Project No.1 in 24-Hour Trading Volume Another day, another NFT project, but with the strong network and idiosyncratic art behind this one, it might be in it for the long haul. The new kid on the block is CrypToadz. At 4,873 ETH, over $15M, in weekly trading volume, the project has quickly vaulted to the tenth slot on OpenSea despite launching just two days ago.
dYdX Drops Over $1B to Past Users in Airdrop Margin trading protocol dYdX launched its native token with one of the largest distributions in decentralized finance. dYdX dropped 7.5% of its initial billion-strong token supply on Sept 8. At the current price of $11.12, those 75M tokens are worth more than $800M. At one point the airdropped tokens’ value eclipsed $1B.
Thanking all the amazing Defiers for the support and love this week (and always)!
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