Recap: DeFi Week of May 11 🦄

Hello Defiers, hope you’re having a good weekend!

Summing the past week up: This was a big week for DeFi. ErisX started offering CFTC-regulated ETH futures. Reddit introduced ether tokens to its crypto and Fortnite communities, which together have more than 2 million members. One of the most promising privacy solutions for Ethereum, Tornado.cash, is just steps away from being fully trustless. MakerDAO shut down its Sai stablecoin, while an Ethereum token version of BTC surged into the protocol after being added as collateral. A Grammy-award winning artist launched a tokenized cassette tape, and its price quickly surged above $500. For-profit DAO MetaCartel Ventures announced its first investment. Synthetix founder Kain Warwick wrote a column on why his platform won’t introduce permissioned assets, while Balancer Labs founder Fernando Martinelli explained how his platform allows anyone to create their own index fund, and get paid for it. And there’s even more.

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Interview

Anyone Can Create Their Own ETF and Get Paid for It; This Wasn't Possible Before: Balancer Labs co-founder Fernando Martinelli

This week’s interview is with Fernando Martinelli, co-founder and CEO of Balancer Labs. Balancer enables users to create token pools that have any ratio they want between their tokens. They can use any combination of tokens, and can even exclude ETH. The pools automatically rebalance when tokens’ price change, so that the same ratio is maintained. This way, liquidity providers are effectively creating something like a tokenized index fund, or ETF, in which anyone can invest. On the other side of the protocols are the liquidity takers, or traders, who can exchange tokens from these pools, or “ETFs.” Martinelli explains how Balancer works, and gives the scoop on what’s coming up next, which includes, an interface for non-technical users to create their own token pools, a Balancer token to be launched in V2, liquidity provider rewards using this new protocol token, and plans for decentralized governance. 

🎙Listen to the interview first hand on this week’s podcast. 

Op-ed

"We Have Zero Intention of Following the Path of Maker Towards Permissioned Assets:" Synthetix's Kain Warwick

A fully permissionless and decentralized stablecoin is one the most important pieces an open financial system should be building, says Kain Warwick, the founder of synthetic assets trading platform Synthetix. As of recently MakerDAO was the main project focusing on such a system, but it recently began to advance towards a more centralized model, by adding assets that rely on third parties such as USDC. Warwick is taking a stand: Synthetix is going in the opposite direction. While today Synthetix is further from the fully decentralized end of the spectrum than many DeFi projects, its road map is for the Synthetix team to increasingly transfer control of the protocol to its community. Warwick pledges to never include permissioned assets, such as fiat-backed stablecoins.

Thursday

Dives

  • Reddit Instantly Introduced Crypto to Two Million People: Reddit is introducing cryptocurrency to reward engagement in two of its communities, which together have more than 2 million members.

  • Tornado is Steps Away From Becoming Fully Trustless: Tornado.cash, a privacy solution for Ethereum transactions, is about to become fully trustless after completing its “Trusted Ceremony.”

Bytes

  • dYdX Perpetual Contracts Are Live: dYdX’s perpetual bitcoin futures contract are live and open to the public after running a private test version for the past three weeks.

Wednesday

Dives

  • WBTC Surges into DeFi as Traders Snap Up Cheap Loans: Freshly minted WBTC is surging into decentralized finance after the MakerDAO community added the token as collateral last week.

  • MakerDAO Sai Shutdown Spur Calls for “Pure” Stablecoin: MakerDAO shut down the first version of its Dai stablecoin yesterday, further spurring calls for a more “pure” competitor.

Bytes

Tuesday

Dives

  • ErisX Launches First CFTC-Regulated Ether Futures: Investors can now trade ether futures on a regulated US exchange for the first time after ErisX launched physically settled, CFTC-approved, ether futures contracts. 

Bytes

  • Aave Plans to Take Money Legos to Whole New Level: Aave, a decentralized lending protocol, is planning to accept tokens that represent investments in other platforms, within its own application.

  • Limited Edition Tokenized Cassette Selling for $500+: Grammy-award winning André Allen Anjos, known as RAC, is selling a limited-edition cassette tape of his new album BOY via digital tokens called $TAPE. The tokens, which had a starting price of $20 on the Zora marketplace for tokenized assets, are now trading at over $500.

  • MetaCartel Ventures’ First Investment is a Stablecoin: MetaCartel, the first for-profit decentralized autonomous organization since The DAO announced it’s backing Reflexer Labs in its first investment. 


💜Community Love💜

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 at $10/month or $100/year, while free signups get only part of the content.

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About the founder: I’m Camila Russo, a financial journalist writing a book on Ethereum with Harper Collins. (Pre-order The Infinite Machine here). I was previously at Bloomberg News in New York, Madrid and Buenos Aires covering markets. I’ve extensively covered crypto and finance, and now I’m diving into DeFi, the intersection of the two.