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Recap: DeFi Week of Jan. 18 🦄
Hello Defiers! Hope you’re having a great weekend.
Summing up: This week started out with a bang with ETH piercing through its previous all-time high of over $1,400. We covered the record-breaking move and also dug into what other Ethereum metrics were doing and (likely unsurprising if you’re subscribed to this newsletter), nearly every chart is pointing up and near a record. Bitcoin locked in DeFi is also rebounding and near an all-time high. And speaking of Bitcoin, there was a bit of drama there with a double-spend scare.
In project upgrades, we covered Melon Protocol rebranding to Enzyme and launching its V2, and Yearn Finance’s V2 with multi-purpose vaults and a new fee structure. In project launches, Saddle is the latest AMM to join the party; an interesting project with remarkable backers which nonetheless had a rocky first day. On the Layer 2 front, Synthetix moves staking to Optimism, and Aave’s aTokens will now be available on the Matic network.
We interviewed DeFi whale 0xb1, who revealed their best trades and DeFi vision, and DJ 3LAU wrote a guest post on how he envisions the future of music, with tokenized songs and an investable layer disintermediating record companies, and allowing fans to benefit from creators’ success. In our Defiant Weekly video, we covered Tether, the stablecoin that’s somehow managed to become ubiquitous and a skeleton in crypto’s closet, at the same time. The Tuesday Tutorial went over the easiest way to stake to ETH2, while DeFi 101 covered gas, adoption and DeFi resources.
And that was just one week! There’s a lot going on, but we’ve got you covered :)
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🙌 Together with Zerion, a simple interface to access and use decentralized finance, and Value DeFi Protocol, a suite of DeFi products including the Value Liquid AMM, which allows anyone to create trading pools with flexible ratio pairs.
Building the Investable Layer of Music, by 3LAU
We are heading into a future where tradeable instruments will have different shapes from what we’re used to in traditional finance. Assets that are now restricted only to the wealthy few, or which were highly illiquid, like art and real estate, will be available in liquid secondary markets accessible to a broader, global investor base. We’ll also be able to exchange items which just weren’t easily tradable before. We’re already seeing that happen with clothing and social tokens, and we’re just scratching the surface.
DJ and music producer 3LAU (Justin Blau) explores what that will look like with music. He envisions a world where tokens allow artists to connect directly with their audience, removing the need for intermediaries, and where fans can become investors in their idols. In this future, owning your favorite band’s token will also mean having access to real-world experiences, and even earn part of their royalties, so that you will also benefit from their success.
DeFi “Will Bleed Into the JPMs of The World,” 0x_b1 Says
0x_B1, a pseudonymous trader or traders who holds at least 1% of assets in DeFi, isn’t just about cold, hard cash. In an exclusive interview with The Defiant, they revealed their long term vision for the space, and how their motivation goes beyond financial gain —though of course, they’re raking in profits too.
DeFi Tokens & ETH-Killers Lead a Risk-On Market in 2021: Most of the best-performing assets in 2021 thus far are either smart contract platforms or DeFi tokens. The notable exceptions are Dogecoin and Stellar, even though the latter does have limited smart contract compatibility.
Bitcoin Locked in DeFi Nears Record High: The total value of Bitcoin locked in DeFi is rebounding from a three-month low to the highest since November, when BTC in decentralized finance protocols was at its all-time high of 154K BTC, according to data by DeFi Pulse.
Bitcoin "Double-Spend" Is Just Sensationalism: After Bitcoin’s price spiraled down 12% on the morning of Jan. 21, many crypto community members pointed to BitMEX Research’s recent Twitter thread regarding a potential “double-spend” picked up by their ForkMonitor.
On-Chain Asset Manager Melon Rebrands as Enzyme: Enzyme Finance, the on-chain asset manager formerly known as Melon Protocol, launched its V2 to include more assets and integrations with a greater number of DeFi protocols.
BTC & ETH Massively Beat Crypto Hedge Funds in 2020: Sometimes “HODL” really is the best advice. Simply holding Bitcoin and Ether massively outperformed crypto hedge funds (along with the vast majority of non-crypto assets) in 2020.
Aave’s aTokens are Latest DeFi Lego Heading to Layer 2: Aave’s aTokens, minted when users deposit digital assets into the lending protocol, can now be ported to the Matic Network, a version of the Layer 2 solution, Plasma.
ETH Heats Up and Not Just The Price: As Ether makes headlines surging past its previous high, other less flashy metrics are also near records, signaling the Ethereum network is strengthening not just in price.
Kyber Network Shows Signs of Life as DeFi Booms: Kyber Network eyes the $2 high last seen in August 2020. KNC has lagged DeFi, but now bulls are attempting to take the lead. The next trading block of note is the $1.50-$1.70 range, where sell-side pressure from various bag-holders might increase.
Synthetix Introduces Layer 2 Staking on Optimism: Synthetix, the synthetic asset issuance protocol, deployed its staking code from Ethereum to Optimism, a Layer 2 scaling solution on Jan. 15.
New AMM Saddle Had Bit of a Rocky Start: Saddle, the freshly launched dApp “designed to enable efficient trading between pegged value crypto assets,” aims to tackle slippage. And while the project quickly reached its initial deposit cap, it wasn’t without a couple of hiccups.
Yearn Overhauls Fee Structure in V2: Yearn Finance, the yield farming aggregator, dropped its version two (V2) on Jan. 17, with a slew of changes including a mechanism to funnel staking fees to the protocol’s treasury, meant to make development sustainable in the long term.
🧑💻 ✍️ Stories this week were written by Owen Fernau, Daniel Kahan, Lucas Outumuro and Christopher Attard, and edited by Camila Russo. Videos were produced by Robin Schmidt and Alp Gasimov. Podcast was led by Camila and edited by Alp.
Thanking all the amazing Defiers for the support and love this week (and always)!
The Defiant is a daily newsletter focusing on decentralized finance, a new financial system that’s being built on top of open blockchains. The space is evolving at breakneck speed and revolutionizing tech and money. Sign up to learn more and keep up on the latest, most interesting developments. Subscribers get full access, while free signups get only part of the content. Click here to pay with DAI (for $100/yr) or sub with fiat by clicking on the button above ($10/mo, $100/yr).