Another exciting week in DeFi as markets rally and the LSD narrative heats up — check out our weekly roundup of the most important DeFi tweets, news and alpha you can't miss out.
In the liquid staking derivative (LSD) race, Frax is on everyone’s lips this week as the project takes center stage. MetaMask hops on the trend too, now offering LSD options for ETH staking right in their wallet interface.
Euphoria is in the air again as the markets roar back to life in a very, very green first three weeks of 2023.
Let’s see what went down this past week in DeFi.
Overview: The Weekend Surge
The Total Value Locked (TVL) across all chains rose another 5.2% from $44.66b to $46.99b as the crypto market sees a surge across the board on Friday night before the weekend hit. Notable TVL increases were on Celo, Solana and Algorand with increases in TVL between 18-32%.
Source: DeFiLlama
Ethereum: Still High on LSDs
The LSD narrative continues to run high with the top Ethereum wallet, MetaMask, introducing staking via Lido and Rocketpool within the MetaMask interface. This greatly reduces the difficulty of accessing these services for those less familiar with the Wild West that is the DeFi space.
Frax takes headlines as well, with their edge over other LSD protocols, due to their outsized holdings of Curve and Convex tokens. Tailwinds from the Frax halving in December 2022 also continue to push FXS higher due to lowered token inflation.
Yield tokenization protocol, Pendle upgrades, bringing real-yield to users who lock their Pendle token through sharing of protocol revenues, swap fees and boosted yields. This move puts Pendle in the “real-yield” arena, alongside protocols like GMX and Gains Network.
DeFi’s most dominant lending protocol, Aave, announced Aave v3, which launched on all testnets: Goerli, Mumbai, Optimism and Arbitrum this week. This upgrade comes amidst anticipation of the launch of Aave’s upcoming stablecoin, GHO.
SushiSwap released their 2023 roadmap which includes: more decentralization, decentralized exchange (DEX) aggregation, improved tokenomics and a new incubator (Sushi Studios), among other goals.
Security protocol, Harpie, launches Eagle, an on-chain two-factor authentication (2FA) connected straight to your wallets. The feature is currently open to beta-testers.
Masa Finance launched as well on Mainnet last Tuesday, allowing users to mint their .soul names, much like the Ethereum Name Service.
Last but not least, Australia announces their plan to launch a national stablecoin, AUDN, on the Ethereum and Algorand blockchains.
L2s: zkEVM Inbound
Polygon Co-Founder, Sandeep, hints at the imminent launch of Polygon’s very own zero-knowledge Ethereum Virtual Machine (zkEVM) Mainnet, which he claims to be “SOOON!” With more zk-rollups launching in the L2 space, optimistic rollups may soon see their dominance threatened.
Multi-chain options protocol, Premia, releases their v3 whitepaper (which seemingly no one actually understood). Fret not, they promised an “Explain-it-Like-I’m-5” version before the actual v3 launch though.
Dopex launches Option Liquidity Pools, giving more flexibility to option traders on Arbitrum, by allowing them to exit their positions easily through the liquidity pools, at a discounted price.
Solana Stablecoin protocol, UXD Protocol, announces plans for an expansion to Ethereum and its rollups, Optimism and Arbitrum.
Polygon: Upgrades All Round
Popular perpetuals DEX, Gains Network, introduced Indices and Commodities, shortly after expanding to Arbitrum just 2 weeks back to compete against close competitor, GMX.
Polygon hardforks their PoS chain to reduce gas spikes and improve performance, all in one sweet upgrade.
Cosmos: Enhanced Osmosis
Cosmos DEX appchain, Osmosis, announces their Neon upgrade, allowing for cross-chain swaps, downtime detection and geometric Time-Weighted-Average-Pricing (TWAP).
Another Week, Another Airdrop
Upcoming perpetuals DEX built on StarkEX, Gammax Exchange, announces a potential airdrop to early users of their platform.
L2 orderbook DEX, ZigZag, announces their much anticipated airdrop this week, with the first round allocated to early market makers on the platform.
Former Terra blockchain protocol, Prism Protocol, announces airdrop to Cosmos token stakers if they delegate to Prism’s Cosmos Hub Validator.
Up and coming LSD protocol, Swell, announces their plans for an airdrop as well via Discord, to stakers on their platform.
Hot Alpha, Straight off the Press!
On-ramp service provider, Alchemy Pay scores a series of wins in partnerships with Visa for on-ramp/off-ramp services and Apple with Apple Pay. Significant partnerships with huge Web2 payment providers could usher in greater adoption for the crypto space.
Permanentgainz covers all of the catalysts he’s watching closely for Q1 2023 including upcoming large unlocks for dYdX, MAGIC and 1INCH tokens in the coming weeks.
Want to know what “Smart Money” is doing in DeFi today? 0xFlips drops hot alpha on the art of whale watching.
If you’re clueless on what to do with all your ETH tokens, Blue Collar Blockchain has got you covered with his thread on ETH staking strategies, with a variety of options catering to different risk levels.
Finally, CT’s longest thread writer award goes to... Adam Cochran, who delivers a whopping 268-tweet long thread for his 2023 Shopping List, covering 31 different projects.
Builder activity continues to run high with the market bursting back to life. 2023 will definitely be an interesting one for the DeFi space. Stay tuned for next week’s edition and keep exploring the DeFi space, degens!
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