Huge week for new Ethereum layer-2s, as Blast and Taiko launches on testnet, while protocols announce airdrops as "points" season continues — read on for more major DeFi news and alpha!
Controversial L2 chain Blast, founded by Blur’s Pacman, launches on testnet, with a mainnet launch targeted for late February. Meanwhile, Frax Finance launches Frax Bonds, a new product to purchase discounted FRAX tokens, and finally, Delphi Labs released Asteroid, a Cosmos-based inscription protocol.
Overview
Total Value Locked (TVL) across all chains take a slight dip as markets lose steam after the Bitcoin ETF approval. Notable outperformers to the trend include Polkadot-based chain, Astar, Telegram blockchain, TON, and the Cosmos Hub, with all three chains seeing jumps of 20-70% in TVL.
Source: https://coinmarketcap.com/chain-ranking/
Welcome to Alpha Central
DeFi Made Here discusses liquidity provision models and covering which protocols he feels does it best.
TL;DR:
- GMX pools, while popular, tend to underperform in a bull market, with the fees being insufficient to make up for loss in upside
- Synthetic trading protocols such as Hyperliquid and Gains Network use stablecoins as collateral which while tend to do better, result in users holding stablecoins, which may not be ideal in a bull market.
- New unique models like Aark Digital and Chromatic Protocol enable the use of volatile assets such as ETH and BTC for single sided liquidity provision.
Ethereum: Chainlink x Circle
Oracle network, Chainlink, integrates Circle’s Cross-Chain Transfer Protocol (CCTP) into their Cross-Chain Interoperability Protocol (CCIP), ensuring the highest level of security for USDC transfers across chains.
Stablecoin protocol, Frax Finance, unveils Frax Bonds, a bond product denominated in FRAX, that matures into FRAX tokens at a specified future date. These bonds have already been integrated into Curve’s liquidity pools, Fraxlend pairs and more.
Going beyond liquid staking, popular wallet MetaMask now enables direct Validator Staking via the MetaMask Portfolio. Users holding 32 ETH can now run their own validator node from within their wallet, with MetaMask handling the technical aspect.
Other Product Launches and Updates
- Bridging protocol, Wormhole, integrates Uniswap V3 liquidity pools to enable cross-chain transfers of native ETH and wstETH across L2s and other Ethereum Virtual Machine (EVM) chains.
- Bridging infrastructure protocol, Socket, faced an exploit this week, resulting in $3.3 million in funds lost. The incident has been contained and contracts paused. Socket is the backing infrastructure behind bridges such as Bungee Exchange.
- Fixed-rate lending market, Term Finance, partners up with ETH restaking product, EtherFi, to offer the first lending markets backed by EigenLayer’s liquid restaked tokens (LRTs).
- Asymmetrix, an ETH staking protocol for asymmetric yield distribution, unveils Mini Pools, a new product favoring smaller depositors on the protocol over whales by allowing the Mini Pools to compete as a “collective user”, hence improving their odds.
- Ethereum positional markets, Thales, announces their updated tokenomics for THALES, enabling new protocol rewards, reduction in weekly emissions and cross-chain staking, enabled by Chainlink’s CCIP.
L2s: Blast and Taiko Testnets Live
Blur’s L2, Blast, launches on testnet, kick-starting the Big Bang competition where developers compete to bring the best decentralized applications to Blast. 50% of the Blast airdrop has been allocated to rewarding developers on the L2.
Ethereum-equivalent zero-knowledge EVM chain, Taiko, launches their final testnet, Katla, before the upcoming mainnet launch. Katla brings to the chain improved architecture, NFT bridging and currently supports the EIP-4844 upgrade, although the feature is currently turned off.
Other Product Launches and Updates
- Stablecoin protocol, QiDAO, passes a governance vote, enabling the minting of the MAI stablecoin using USDM, a yield-bearing stablecoin issued by Mountain Protocol, on all Ethereum L2s.
Solana: MarginFi Enables Flash Loans
Top lending protocol, MarginFi, releases flash loans, enabling power users to borrow the maximum number of tokens, provided they are returned in the same block, with no fees.
Lending protocol, Kamino Finance, unveils the UI for Kamino Points, the reward system which impacts Kamino’s upcoming waves of token airdrops. Deposits and borrows since the beginning of Kamino in August 2022 will receive points based on amount and duration.
Solana perpetuals decentralized exchange (DEX), Drift Protocol, unveils Drift Points, a point system to reward contributors to their platform. In the same week, they also released one-click market making vaults to provide more complex strategies to traders on Drift.
Bitcoin-Ethereum bridge, Multibit launches their Solana expansion, enabling the transfer of assets from Bitcoin to Solana. The bridge currently supports three tokens, MUBI, BSSB and stablecoin, DAII.
Cosmos: Asteroid Brings Inscriptions to the Cosmos
Delphi Labs and Cosmos-based DEX, Astroport, unveil Asteroid, an inscriptions-focused protocol for the Cosmos ecosystem. Users can now publish content directly to the Cosmos Hub.
Another Week, Another Airdrop
Rollup-as-a-Service solution, Alt Layer, announces their upcoming token, ALT and airdrop. AltLayer OG Badge NFT holders, Oh Ottie! NFT holders, qualified participants of Altitude campaigns, Celestia stakers and EigenLayer Restakers are eligible for the airdrop.
Solana DEX aggregator, Jupiter, announces the date for their airdrop, 31st January. They will also be conducting two test drops, one which has already concluded this past week, mockJUP, and a memecoin launch in the coming week.
NFT-focused L2 chain, Frame, also announces their airdrop launch date to be 31st January, with further information on the distribution to be released in the coming weeks.
Popular EVM-based wallet, Rabby, teases a snapshot, which could be for a potential upcoming airdrop. The wallet is released by portfolio tracker, Debank.
Tweet of the Week
WazzCrypto calls out Crypto Twitter influencers who collectively shill new token launches to dump on their unsuspecting followers.
Stay updated on your favorite projects and stay tuned for next week’s edition, and keep supporting your favorite projects, degens!
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