DeFi Pulse Farmer #11
Catch up on a new week in DeFi as we recap wBTC, Aave, the Farm of the Week, the Conservative Farmer and much more.
Welcome to the eleventh edition of DeFi Pulse Farmer - your guide to staying up on the latest and best trends in yield farming and beyond.
In this newsletter, we break down top stories, developments, and trends from the past week in tandem with two key farming opportunities to keep an eye on.
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Looking to catch up on the last two weeks? We’ve got you covered!
DeFi’s total value locked (TVL) is currently hovering at $11B after having hit as high as $11.39B on Wednesday. It’s the third time the ecosystem’s TVL has held ground over the $11B mark since the start of October.
Notably, leading lending protocol Maker saw its TVL reach $1.98B this week, putting the DAI issuer in range of becoming only the second dapp behind trading protocol Uniswap to hit a $2B TVL. Who’s next? Maybe WBTC.
Over the past few days, we’ve seen the popular tokenized bitcoin implementation notch a $1.19B TVL, allowing the protocol to acutely overcome Aave as DeFi’s reigning third-largest project. The climb comes as Coinbase Pro just announced its listing of WBTC, which in turn paves the way for imminent support on the crypto exchange giant’s retail-centric Coinbase.com and mobile apps. WBTC is coming to the cryptoeconomy’s masses, in other words, so expect new users and growth around Ethereum DeFi accordingly.
Now, let’s recap the recent tokens of note. During a week in which most of DeFi tokens are down, some of the best 7-day performers in DeFi this week were REN (18% to $0.32), AKRO (11.2% to $0.012), and GNO (5.3% to $43.34).
Stories of the Week
Second OVM L2 testnet SNX distribution
TLDR: Synthetix opens the second phase of its incentivized trial atop Optimistic Ethereum’s Layer 2 testnet.
y3Crv vault is live
TLDR: The yEarn team launches its new y3Crv Vault, which is based on Curve’s 3Pool.
Aave Raises $25 Million
TLDR: Popular DeFi lending protocol Aave raises $25 million in new funding from investors like Blockchain Capital and the venture arm of Blockchain.com.
mStable eyes adding sUSD
TLDR: The mStable community votes “yes” in a snapshot poll to add the sUSD stablecoin to its mUSD basket.
Kwenta is now live!
TLDR: The Synthetix-powered Kwenta, which offers “infinite liquidity” for slippage-free derivatives trading, opens for trading.
Proposing Bancor v2.1
TLDR: Automated market maker Bancor introduces new single-sided AMM exposure and BNT supply elasticity.
Crypto Economics, Perpetual Liquidity and IL offsets
TLDR: Andre Cronje introduces the concept of a liquidity based inflationary token that can offset IL via liquid governance.
This week’s newsletter is sponsored by BARNBRIDGE, a fluctuation derivatives protocol for hedging yield sensitivity and market price.
Farm of the Week
Harvest 99% APY by Staking VLP Tokens in Value DeFi
There’s a new rebrand in DeFi worth tracking, and it’s Value DeFi.
Starting out as YFV.Finance earlier this year, the yield aggregator project recently conducted a 2.0 rebrand to Value DeFi as the protocol has evolved beyond mere yield farming services into offering an entire suite of DeFi products. As part of this shift, the YFV token was migrated into VALUE.
Everything about VALUE, from its emission schedule to its community-first Vault strategies, is tailored to win over and reward long-term Value DeFi stakeholders. So with a new look and new roadmap, now the name of the game around the protocol is VALUE farming.
Choose Your Farm, Earn Your VALUE
At its core, Value DeFi is about DeFi accessibility and in particular making yield farming easy. The protocol makes VALUE farming straightforward and appeals to a broad community via multiple asset staking options.
Source: Value DeFi
The VALUE farming flow works like this:
Pick your farm of choice
Add liquidity at valueliquid.io
Receive VLP liquidity provider tokens
Stake VLP at valuedefi.io/staking
That’s all you’ll need to do to start passively farming VALUE as well as trading fees from your chosen Value DeFi farm, and it’s easy to unstake your VLP and withdraw your rewards and underlying assets.
This week we’re particularly keen on Value DeFi’s DAI/VALUE 80/20 pool, which is currently generating an unstable APY of 99% for stakers and maintains a good balance between potential risks and potential rewards. For farmers interested in trying this pool out, you can pick up DAI and VALUE on Uniswap and add liquidity here.
Remember, serving as a liquidity provider and staking your LP tokens in rising farming projects comes with inherent risks. Always research interesting protocols first before participating, and don’t plow with more money than you can afford to lose. It’s all about farming responsibly!
The Conservative Farmer
Harvest up to 7.3% with Aave staking
Aave, the money markets protocol that allows lending and borrowing for different assets, recently announced version 2 of their protocol, which introduced their new tokenomics, also known as Aavenomics. These included several upgrades to their protocol, including the migration from their LEND token to their new governance token AAVE.
As part of their upgraded system, Aave is currently providing rewards to farmers who wish to stake their Aave tokens to secure the protocol. There are presently 400 AAVE being rewarded each day.
How to stake AAVE to get AAVE rewards
Farmers that currently own LEND tokens and haven’t migrated to AAVE should first migrate. You can find out how to migrate LEND to AAVE here. Alternatively, farmers that do not own AAVE tokens can swap AAVE on Uniswap or Balancer.
Once farmers have AAVE in their wallets, they have to go to the AAVE staking portal, select the amount they wish to stake, and click on stake.
Farmers will be prompted to approve the AAVE asset and will then have to click on submit, under the Stake Aave section. At the moment of writing both transactions have a cost of around $14.
And that’s it, from that moment on, farmers will be harvesting AAVE rewards!
When farmers want to unstake their assets, they will need to activate the cooldown period. After this option is turned on, farmers will need to wait ten days to withdraw their holdings during an unstake window period that gets activated. If assets are not withdrawn during that period, farmers will need to reactivate the cooldown period.
Please take into consideration that staking AAVE on Aave comes with risks. The assets staked by farmers are used to secure the protocol. This means that up to 30% of staked assets can be slashed to cover the deficit in the case of a shortfall event.
Plow of the Week
This week's tool of the week goes to CoinMarketCap's yield farming ranking. The Yield farming tool groups different farms by protocol, providing farmers with a high-level view of each platform's different options. The tool also includes a handy IL risk section for farmers to compare across pools.
Alpha Leaker of the Week
While the first weeks of Q4 remain quieter than what we saw during Q3, this is no sign of the industry slowing down. New projects keep launching week after week, and conversations such as what the different value propositions of AMMs are and how these can evolve in an existing market in which Uniswap had more volume than Coinbase during September, show that we continue to see signs of maturity across the DeFi.
If one thing is for sure, exciting times are ahead of us!
Until next week, and have a great weekend!
All info in this newsletter is purely educational and should only be used to inform your research. We're not offering investment advice, endorsement of any project or approach, or promise of any outcome. This is prepared using public information and couldn't possibly account for anyone's specific goals or financial situation. Be careful and keep up the honest work!