To Our DeFi Community,
Another week in DeFi in the books. As always, the week was filled with new releases, projects reaching new milestones, and more.
One of the most interesting things to happen was Curve Finance – an exchange liquidity pool (similar to Uniswap) designed for highly efficient stablecoin trading – integrating the RenVM. The integration now enables cross-chain interactions for depositing native BTC on Curve, allowing BTC holders to earn a high yield for providing liquidity to the DeFi protocol. The renBTC <> wBTC Curve pool is currently offering 4.12% APY on BTC, substantially higher than any other platform offering rates on wrapped Bitcoin. The only ones to compete are centralized entities like BlockFi which offer upwards of 6% on BTC deposits.
While Curve’s integration provides a more diverse range of yield hacking options for BTC holders, the important takeaway from this was really demonstrating the power of the TenVM for abstracting cross-chain transactions.
In less than 2 weeks, the RenVM has facilitated over $1M in volume – a rather impressive milestone in such a short period of time, especially with only a few integrations so far. In the future, we can only imagine the RenVM to grow in relevance as it facilitates seamless interactions for any crypto asset to any major DeFi protocol. Imagine a user sending a native BTC transaction and receiving a Dai loan from Maker or depositing it into leading lending protocols like Aave and Compound. Users can take their native BTC holdings, execute a normal Bitcoin transaction, and then immediately have access to any of Ethereum’s DeFi protocols. All of the complexities and frictions are completely abstracted away, leaving users with a smooth cross-chain experience. The potential composability here is pretty insane.
Better yet, it can happen for any asset in the entire crypto ecosystem, not just Bitcoin. Other non-Ethereum assets like Bitcoin Cash, Tezos, and Zcash – all of which boasts substantial market caps – could leverage the RenVM to capitalize on the growing range of money verbs accessible through DeFi.
Ultimately, the RenVM is just another piece to the Ethereum composability puzzle. This is what’s driving Aave’s surge to over $100M in market size in less than 6 months after its rebranding. The team has been keen on leveraging composability to bootstrap new markets, like Uniswap Liquidity Pool tokens and Set Protocol‘s TokenSets. Rather than relying on the more traditional sources of economic bandwidth like ETH, DAI, and others, Aave is pushing the boundaries through innovation. Now, with the RenVM hitting its stride, we can only expect Aave and others to capitalize on this opportunity as they look to integrate Ethereum’s newest interoperable money lego.
We’re continuing to see the power of composability as the available tools for DeFi developers only increases. It feels like the level of innovation is compounding every week. With that, it’s hard to imagine what new primitives and assets will emerge over the next year as DeFi ecosystem continues to innovate. I mean who expected flash loans?
There’s so much latent potential in this space that it’s hard not to be excited. Eventually, it will be realized by the broader market.
Luckily, we’ll be here to see it happen.
Till next week!
-Lucas
Interest Rates
DAI
- Highest Yield: dYdX at 3.2% APY (Aave close behind at 3.12%)
- Cheapest Loan: Maker at 0.0% with ETH collateral (Compound follows at 1.47% APY)
- Biggest Mover: dYdX increased to 3.2% APY up from its 30 day average of 2.67%
- MakerDAO
USDC
- Highest Yield: Nuo at 10.23% followed by BlockFi at 8.6%
- Cheapest Loan: Compound at 4.73% interest or CoinList at 1% (institutions only)
- Biggest Mover: dYdX offering 3.67% deposit APY, up from 1.62%
Curve Integrates the RenVM
Deposit native BTC and earn a yield on Ethereum-based Bitcoin.
The Graph Partners with ChainLink
The Graph is teaming up with ChainLink to provide more efficient data routing for DeFi queries
Synthetix Trials SNX Balancer Liquidity Incentives
The sector-leading derivatives protocol, Synthetix, launched a trial for SNX Balancer liquidity incentives alongside protocol and product updates.
Opium Exchange launches pre-market trading for BAL + COMP
A non-custodial exchange for derivatives has launched pre-market trading for DeFi governance tokens COMP and BAL.
Aave crosses $100M market size
The sector rising lending protocol has reached a major milestone ahead of its upcoming governance transition.
In Other News…
- [Interview] Meet Fernando Martinelli: CEO of Balancer Labs
- [Investments] Check out our new DeFi investments page!
- [Lending] Compound COMP token distribution details (starts on June 15th!)
- [Ecosystem] Top 5 ETHGlobal HackMoney Winners
- [Governance] CurveDAO Governance token details
- [Tutorial] How to stake SNX and earn a yield
- [Research] DeFi Tokens Outperformed BTC in 2019 (new piece on this soon)
Stat Box
- RenVM Reaches $1M in total volume in 2 weeks
- Ethereum user executes multiple transactions with multi-million dollar fees
- Nexus Mutual active cover amount crosses ATHs
- Number of new DeFi Assets per month reaches ATHs
- Dune Analytics revamps DEX dashboard
Bonus Reads
- [Raul Jordan – Prysmatic Labs] Introducing the Onyx Testnet
- [David Hoffman – Bankless] A Bankless Nation Part 1
- [Lucas Campbell – The Defiant] Balancer’s BAL shows how tokens can supercharge growth
- [Spencer Noon – Our Network] Issue #25: MakerDAO, Synthetix, Set Protocol, and Balancer
- [ConsenSys] How €350M worth of Real Estate was tokenized on Ethereum
- [Alex Gluchowski – Matter Labs] Evaluating Ethereum L2 Scaling Solutions
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