This Week In DeFi: DIP, Layer-2 explosion, MEV & solutions

Welcome to This Week in DeFi!

DeFi is one of the fastest-growing industries in the world. It’s nearly impossible to stay up to date with everything. Therefore, Coin98 Insights has decided to bring you this series. This Week in DeFi will help everyone stay up to date with the market and provide helpful insights to figure out investment opportunities. 

Highlights this week:

• The market continues falling. However, the amount of stablecoin deposited into exchanges is rising.
• Layer 2 solutions are exploding. Many projects announced their products and integrations across the field.
• MEV and its solutions are one of the hottest topics right now.
• And many other remarkable updates.

If you missed some important news from previous This Week In DeFi, read more here.

Overview

1. The market continues falling this week. Bitcoin is now being traded at $50,000/BTC. However, the amount of stablecoins deposited into exchanges continues rising.

2. DeFi

DeFi was also affected by the market. This week, TVL dropped from over $120B to $108.92B. 

New Updates

Layer 2

Loopring ETHport

One big news from Loopring, the project just announced Ethport. Ethport will allow L1 Dapps to transfer assets to L2 in a more gas-efficient way. This product also supports cheap and capital-efficient cross L2 transfers.  Loopring will release ETHport in May.

This solution solves the existing problem on Ethereum, and if it works, it will help users reduce the cost when joining Layer 2.

Celer Layer 2. Finance Launches

Celer, a layer two solution for Ethereum scaling, launched layer2.finnace. Like other solutions, this release will help DeFi users reduce the fee and the complexity.

Dex

PancakeSwap growth

Big announcement from PancakeSwap: Started from today, every trade made on PancakeSwap V2 will contribute to burning CAKE and reducing emissions.

This news will essentially reduce the total supply of CAKE, especially when the trading volume of this exchange is near $20B/week.

Binance Smart Chain is exploding right now with hundreds of apps, and Pancake is the main gateway for users to access the ecosystem.

Balancer V2

Balancer’s v2 smart contracts are live on mainnet, UI is still pending and will launch on Apr.28.

The most crucial change in Balancer v2 is that it will hold all assets in 1 vault. This upgrade allows for simplifying the process and significantly reducing the gas cost. 

Example:

• Before: If you want to swap assets in many different pools on an AMM, it will cost many gas fees (as assets have to travel through multiple routes). 
• After: With the new design, the assets will automatically swap in one single pool, reducing the gas fee.

As you can see, this design uses cutting-edge technology but at the same time contains high risk.

If attackers attack a traditional AMM, they can only take away assets in one pool at a time. But now, if they successfully attack the Balancer V2 vault, they can rug all assets inside it.

And it seems like the Balancer team is well aware of that. This product alone has gone through three audits from top firms, as well as a 1k ETH (> $2M) bug bounty. 

Curve’s Polygon Pool

Curve has launched a pool on Polygon. Liquidity in the pool will be deposited on Aave. 

Users can swap stablecoins with cheap fees and high speed and also receive incentives from Matic.

Archerswap

MEV (Miner extractable value) is a rising concern recently. The number of assets that have been extracted from users by miners has crossed over $400M.

To prevent the harmful effects of MEV, Ancher DAO has launched Archerswap, a DEX helps user to make 0 slippage trades with 0 cancellation costs. Uniswap & Sushiswap are two DEX that received the first support.

Kyber Migration

KNC token migration has begun. The purpose is to support Kyber 3.0 development and governance better.

Users can start converting KNC tokens now. There is no deadline for this, but users can only stake in Kyber DAO v2 when migrated from v1 KNC to v2 KNC.

Gelato Sorbet

One main problem of Uniswap is that users can’t control the price placed on the platform. 

Gelato Finance has introduced Sorbet Finance, an interface for limit orders on Uniswap.

This one is a killer move that provided the largest DEX the tool to remove one of AMM core problems.

Stablecoin

Ampleforth $FORTH

Ampleforth, the first algorithmic stablecoin protocol in DeFi, introduced new governance token $FORTH. Users who have previously interacted with AMPL on-chain can claim an airdrop worth quite a lot of money. 

Lending/ Borrowing

EasyFi has been attacked

EasyFi, a lending/borrowing platform built on Polygon, announced its founder’s wallet had been hacked. Hackers had successfully stolen $6M in stablecoins and nearly 3M EASY tokens. The platform was not affected, and the team is working with CEXs to limit stolen EASY token usabilities. 

First RWA Loan on MakerDAO

Yesterday, New Silver just financed its first loan using MakerDAO as a credit facility, becoming the first-ever DAI backed with RWA (real-world assets).

RWA is likely to be “hotkey” for the upcoming time because it will open a significant value of off-chain assets that could be used to backed on-chain assets.

Derivative

UMA BAL and UNI Call Options

UMA has added both Balancer and Uniswap call options.

These products are already live and tradable. They will both expire on May 31st, 2021. The strike prices are $90 for BAL,$50 for UNI

Synthetix sFAANG Live 

New synthetic stocks are now live on Synthetix/Kwenta.

You can now trade: sTSLA, sFB, sAAPL, sAMZN, sNFLX, sGOOG.

Aggregator

Alpha Homora v2 relaunch

The relaunch of Alpha Homora v2 will be conducted very soon.

The relaunch will include many innovative features for all lenders and leveraged yield farmers out there in the Alpha ecosystem, like more leveraged pools, assets available to borrow, high yields, etc.

Instadapp’s Ethereum and Polygon Bridge

InstaDapp, a DeFi station that helps users manage, trade, lend their assets in a single platform, just launched a bridge from L1 Ethereum to L2 Polygon.

Users can migrate L1 debt Positions to Aave on Polygon in a single click and enjoy all the advantages of layer 2. Right now, the bridge only supports one-way. Bidirectional bridging will be enabled on the upcoming update.

Others

Crypto on Venmo

Venmo, an app backed by PayPal with more than 70 million customers, announced that they would support customers to buy, hold and sell cryptocurrency directly within their app.

Another big step to adopt a broader user base from outside. 

DeFiSaver Recipe Creator 

Are you feeling DeFi too complicated? Worry no more.

DeFi Saver has just launched the Recipe Creator. This product will help you to combine any number of actions from different protocols into a single transaction. You can think of it as a cooler version of Furucombo. 

Users can also try a simulation mode to simulate actions without spending ETH.

DeFi Saver is a set of DeFi tools with many innovative features that you should check out. The project still doesn’t have tokens.   

StakeDAO v2

StakeDAO, a protocol allow users to manage all staking asset in one Dashboard and leverage it with others strategies has launched v2. 

Stake DAO v2 has a better interface, new features like trading, support cross-chain, NFT,...

Conclusion

We hope that this series has given you an overview and valuable insights into DeFi this week. See you in the next This week in DeFi publish, here.