This Week in DeFi – December 4th
To the DeFi community,
This week at DeFi brought significant consolidations of resources, such as Yearn Finance announced “mergers” with a multitude of DeFi projects, including Akropolis, Pickle Finance, CREAM, Cover, Sushiswap, and many more. These collaborations are cross-functional, allowing Yearn Safes to learn strategies for optimizing Pickle’s yield and use Cover insurance products, or add Cream leverage products to the Sushiswap user interface. The possibilities are endless and the agreements (validated by the governance token holders of the respective protocols) formalize the already open source collaborative nature of the DeFi ecosystem. Perhaps the Yearn consortium?
VISA has announced a partnership with vendor USDC stablecoin Circle (which manages USDC jointly with Coinbase) to allow clients to send and receive USDC. On the same day, U.S. Congresswoman Rashida Tlaib introduced a bill that would require stablecoin issuers to be regulated like U.S.-based banks, requiring a banking charter and even FDIC insurance. Nicknamed the STABLE law, the proposed legislation has encountered resistance within the crypto community and seems unlikely to be passed at this time.
The #STABLEAct is a confused attempt to regulate the perceived damage that is not actually caused by the technology, but is, ironically, inherent in the existing financial system that cryptocurrencies are designed to replace
– Ruben Bramanathan (@bramanathan) December 3, 2020
In addition to pushing back companies like VISA, Facebook will also resist overly broad regulation of digital currencies. The social media giant announced this week that its Libra project, renamed Diem, is expected to launch in January 2021.
Back on the decentralized side, the first phase of Eth2 has begun, offering staking rewards to secure the network as Ethereum moves to Proof of Stake, laying the groundwork for the next generation of the Ethereum network. More than 524,288 ETH (worth over $ 300 million) were deposited before the deadline last week, and the the deposit contract is now almost 100% oversubscribed with almost a million ETH paid. When completed, Eth2 will offer lower transaction costs and increased transactions per second, allowing DeFi and other Ethereum-based applications to achieve a truly global scale.
And just yesterday Aave released V2 of its borrowing and lending protocol, adding new features such as multi-asset flash loans and native credit delegation. Credit delegation allows debt to be drawn against collateral deposited by other uses, greatly increasing the potential DeFi credit pool. Aave is TVL’s fourth-largest DeFi app, with more than $ 1.5 billion in assets locked into the protocol.
And a few notes to end the week …
DeFi, stablecoins and cryptocurrencies continue to gain the attention of regulators and venture capitalists as the price of Bitcoin nears all-time highs. The pace of DeFi’s development appears to be increasing, far exceeding the ability of lawmakers to keep up with the technological changes that are redefining the global financial system. By the time they catch up, crypto and DeFi could be bigger than any of us could have imagined.
The parallel trend for community-led DeFi projects to band together as regulators attempt to make stablecoin heads or tails shows a clear trend towards sovereignty unfolding in crypto, a narrative many are banking on as a stage. for the future of finance.
Highest returns: Pivot at 12.84% APY, dYdX at 6.62% APY
Cheapest loan: Bitfinex at 0.15%
Dai savings rate: 0.00%
Basic fees: 0.00%
ETH stability fee: 2.00%
USDC Stability Fee: 4.00%
WBTC Stability Fee: 4.00%
Highest returns: Pivot at 14.48% APY, dYdX at 6.66% APY
Cheapest loan: BlockFi at 0.15%
Finance is changing the collaborative landscape of DeFi.
Nexus Mutual offers DeFi insurance coverage on centralized depositories.
Visa wants to let you use USDC at thousands of retailers around the world.
Representatives of Congress are targeting stablecoins with a new bill.
A DeFi blue-chip evolves, expanding the DeFi credit market with credit delegation via Aave V2.
Total value locked: $ 14.78 billion (up 14.9% since last week)
DeFi market capitalization: $ 19.3 billion (up 17.4%)
DEX weekly volume: $ 3.78 billion
DAI supply: 1.07B (up 4.9%)
Total number of DeFi users: 996,000 (up 2.1%)
[CoinCenter] – The unintended consequences (?) Of the STABLE law
[Fred Eshram] – Governance minimization
[Cooper Turley – The Defiant] Eth2 is successfully launched with many ETH2 flavors to come
[Anthony Sassano – ETHhub Weekly] Weekly EthHub # 142
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Alex is a Content Writer at Circle, with prior experience in tech startups, Fortune 500 companies, and as a freelance writer and analyst. His interests include cutting edge technologies in blockchain, energy, supply chains, transportation, city life, and more, and he has been part of the crypto community since 2014.