🦀 Choppy market? We've explored an opportunity on a EURS/USDC pair.
Also, read about recent regulatory updates, latest news & breaking stories in the crypto & DeFi arena.
🦀 DeFi TVL remains steady — On May. 3rd, 2022, the total value locked (TVL) in Ethereum DeFi projects was $75.67B according to DeFi Pulse, almost 1% lower than the value we saw a week ago.
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🚜 Exploring DFX Finance’s EURS/USDC pool!
DFX’s EURS/USDC pool is an opportunity to get exposure to collateralized stablecoins in these choppy market conditions! DFX is a decentralized foreign exchange protocol optimized for stablecoins.
The protocol is built on Ethereum and uses a dynamically tuned bonding curve optimized for fiat-backed stablecoins using real world foreign exchange feeds. DFX offers a range of pools for liquidity providers to participate in.
To partake in this conservative farmer, users will have to swap their tokens for USDC and EURS on Uniswap. The ratio of EURS to USDC can be found by expanding the “EURS/USDC” pool inside the dApp.
Once a user has USDC and EURS in their wallet, they may choose to stake them on DFX by heading to the dApp and clicking on the “Pools” section of the website. Users must then head to the “EURS/USDC” pool where they will be able to add liquidity.
📍 Please Note: DFX supports Polygon so users may find additional opportunities by selecting the chain at the top of the dApp.
✅Advantages of the farm:
The pool has a decent amount of Total Value Locked (TVL), so one can assume the yield will not drastically decrease from new pool entrants diluting farmers;
DFX has undergone an audit;
The pool being composed of stablecoins gives participants reduced market exposure. It should be noted that users are still exposed to the price fluctuations of the EUR/USD forex pair;
USDC is one of the most trusted stablecoins and the STASIS Euro is backed one to one by euros held in their reserve accounts.
❗ Risks to keep an eye on:
If USDC or EURS were to lose peg, a user may lose a significant portion of their funds;
Since the farm is composed of stablecoins, the yield is lower than what you could find in a riskier opportunity;
The pool’s rewards are in DFX tokens. This means a user’s rewards are subject to market volatility;
A user may suffer impermanent loss depending on EURS/USDC price movements.
Interested in trying this opportunity? You could:
DFX Finance has been audited, but there are no ultimate guarantees in DeFi. So, always do your own research, and never invest more money into any project than you can afford to lose.
With APY.vision, you can track your liquidity pool gains and losses and acquire the data you need to determine when to enter and quit liquidity pools or yield farms to maximize your returns. Read about Vision tokens here!
As someone running in TradFi circles, I am at this point quite experienced in describing in lengthy analogies what DeFi protocols are doing. “This protocol is just like a bank,” “that protocol is just like an exchange”. The innovation of these protocols was primarily decentralization, operating permissionless without an intermediary, the “how”. DeFi in 2022 is now taking over TradFi, innovating the “what”: Protocols offer services that do not exist in TradFi or are not even possible with their framework and tech.
The rise of liquid staking and its unique yield source comes to mind, currently a focus of many given the anticipated ETH “merge”. Financialization of intangible assets is another example, NFTs being the first, where DeFi is used as a tool to make culture, art, and hype into investable assets. Looking forward to more new stuff. - Christoph Gackstatter, Indices Lead at Scalara
All info in this newsletter is purely educational and should only be used as research. DeFi Pulse is not offering investment advice, endorsement of any project or approach, or promising any outcome. This post is prepared using public information (which does not account for specific goals or financial situations) and links provided to third-party sites are for informational purposes. Such sites are not under the control of DeFi Pulse, so DeFi Pulse or the author are not responsible for the accuracy of the content on such third-party sites. Be careful and keep up the honest work!