DeFi Pulse Farmer #17
Catch up on a new week in DeFi as we recap Yearn, Pickle, the Farm of the week, the Conservative Farmer, the latest Governance updates, and more!
Welcome to 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.
If you want to access the full DeFi Pulse Farmer experience to receive emerging Yield Farming opportunities sent to you throughout the week as part of our Alpha Tractor Series, and the DeFi Pulse Farmer Protocol Express, which consists of a weekly recap of APYs and new pools on major protocols and a highlight of an emerging opportunity, subscribe today.
This week saw the bitcoin price hit $19,500 and the ether price cross $620, after which crypto markets seemingly experienced retracements to higher lows in the ongoing uptrend of the cryptoeconomy.
This acute sell pressure coincided with an acute drop in DeFi’s total value locked (TVL), which sunk to its current $13.09B position after the ecosystem’s TVL hit its standing top of $14.43B around this time last week.
Unsurprisingly, then, some activity left the space as money left, too. But arguably the biggest development with DeFi’s TVL this week wasn’t what changed or didn’t change, but rather what’s going to change.
What I mean is that in recent days we saw Yearn, one of DeFi’s most popular and innovative yield aggregator protocols, launch the ecosystem’s “first M&A deal” with smaller yield aggregator project Pickle Finance.
Per the deal, the Yearn team agreed to integrate Pickle’s developers and meld Pickle’s signature “Jar” vaults system into Yearn’s v2 Vaults, meaning the two protocol’s TVLs will merge when Yearn v2 goes live. This will mark the first time a DeFi project’s TVL has climbed from a merger.
Yet Yearn’s Pickle Finance embrace isn’t all. C.R.E.A.M. Finance (or Cream for short) is also working on its v2 system, which is centered around decentralized lending and leverage services. Thanks to a new agreement between Yearn’s and Cream’s devs, the two projects will now be merging their resources and collaborating on the launch of Cream v2 as a “launchpad for future Yearn & Cream collaborative lending.” This meld will notably boost Yearn’s TVL, too, so the yield aggregator project is certainly one to watch in the days and weeks ahead.
As for how things stand now, though, the top 5 DeFi projects per current TVL are Maker ($2.55B), WBTC ($2.18B), Compound ($1.51B), Aave ($1.34B), and Uniswap ($1.28B).
Regarding tokens, some of the best-performing DeFi assets this week included ALPHA (+54.7%), DHT (+57.2%), KEEP (+36.1%), and CREAM (+16.8%). Lastly, the DeFi Pulse Index (DPI) declined 9.2% to $95 over the last 7 days.
Thank you to our sponsor DEXTF, an asset management protocol that makes managing and investing assets easier through their XTF token funds.
Stake ETH and farm 50% APY via Cream’s 50% CRETH2 / 50% WETH pool!
With the “Ethereum 2.0” Beacon Chain a-go for launch on Dec. 1st chatter’s recently abounded in the Ethereum community around ETH2 liquidity, i.e. how to make the ETH locked up in the Beacon Chain for the long-term liquid.
The good news? Cream, the decentralized lending and exchange platform based on Compound’s and Balancer’s technologies, is giving us all an interesting option to consider with its new CRETH2 product.
Cream first proposed creating an Eth2 validator service earlier this month, with the idea being that users could stake their ETH through Cream and receive CRETH2 as a liquid and eventually redeemable form of that staked ETH in kind. The proposal was approved unanimously by CREAM voters this week, and then CRETH2 was quickly listed on Cream.
This rollout thus opened up liquidity for peoples’ ETH staking positions, with CRETH2 now usable as collateral for borrowing assets or depositable as liquidity itself on Cream. Alas, this brings us to our Farm of the Week: Cream’s 50% CRETH2 / 50% WETH pool.
Through this pool, CRETH2 holders can serve as liquidity providers and earn trading fees while also earning CREAM rewards for staking their LP tokens +ETH staking rewards.
If you’re interested in joining this farm, here’s what you’ll need to do:
Deposit your desired amount of tokens into Cream’s 50% CRETH2 / 50% WETH pool.
Take your LP tokens and stake them through Cream’s rewards dashboard.
Voila! Claim your rewards and unstake as you please.
That’s all you’ll have to do to start harvesting here, but there are some factors to consider before diving in. For one, the underlying ETH2 can’t be redeemed until perhaps late 2021 or beyond. And while the underlying ETH can’t be stolen by design, the CRETH2 service is custodial and will incur an 8% fee on your staking rewards when you unwrap your CRETH2, so keep these things in mind.
Always farm responsibly and do your own research; never jump into any farm with more money than you can afford to lose!
Yearn & Cream v2 Merger
TLDR: The Yearn team announces it will be merging resources with Cream and collaborating on the launch of Cream v2.
Pickle & Yearn ferment co-operation dill
TLDR: The Yearn team announces it will merge with yield aggregator protocol Pickle Finance.
Deriswap: Capital efficient swaps, futures, options, and loans
TLDR: Yearn creator Andre Cronje introduces Deriswap, a new single-contract approach to bringing together features from projects like Uniswap, Deribit, Aave, and more.
$CRETH2 Listed on C.R.E.A.M. Ethereum
TLDR: Cream lists CRETH2, a token representing an ETH staking position through Cream’s new Eth2 validator service.
Pickle was hacked and there has been a loss of funds
TLDR: Pickle Finance explains the details of a complicated attack that saw its Dai Jar drained of nearly 20 million Dai.
HAKKA Weekly Update & Reward Pools v13
TLDR: Hakka Finance updates its community on recent key happenings around the protocol, including the project’s new Thank You Token (TYT).
How to use Yearn Vaults in Argent
TLDR: Ethereum smart wallet app Argent adds direct support for Yearn Vaults, making these DeFi products that much easier to use.
DAI Liquidation Event
TLDR: Compound’s Robert Leshner calls for discussion on whether to take any actions to calibrate Compound in the wake of the project’s recent Dai liquidation event.
Farm 25% on your stable coins on APY.finance with 6 months vesting
APY.Finance, one of DeFi’s yield farming Robo advisors, which introduced its liquidity mining campaign in late September, is currently providing returns of up to 25% to farmers that wish to farm with stable coins such as USDC, Dai & USDT.
This farm is super straightforward and can easily be harvested by conservative farmers. But do take into account that all rewards have six months vesting period. This means that, even though you can withdraw your stable coins at any point, the assigned rewards will be released during six months on a block per block basis. All rewards are provided in the form of APY, the protocol’s governance token.
How to farm APY governance token with stable coins
Farmers must head to APY.finance, connect their wallet, and head to the deposit token section.
Select the token you want to provide liquidity with and enable it to be used on the platform (you can choose Dai, USDC, or USDT).
Hit Earn APY Tokens, and that’s it! You will start earning APY tokens from that moment on.
Please do consider that APY. finance doesn’t show the % returns that you will be earning by providing liquidity. Instead, farmers can see the approximate APY they will receive every day in the “Per day” section after providing liquidity in the system.
Alpha Tractor subscribers can re-visit our October the 1st Alpha Tractor on APY.finance.
Calculate your approximate returns before providing liquidity
To calculate the approximate daily returns you will receive for providing liquidity in APY.finance, you can use the following:
(APY daily rewards * APY Price ) / TVL.
Below you can check a simple sheet where we calculate the approximate rewards a farmer would get by providing $10K liquidity.
As with all farms, don’t forget to do your own research before jumping into any protocol, as no platform is risk-free!
This week’s plow of the week goes to APY.vision, a simple tool that allows farmers to track volume, liquidity, impermanent loss, collected fees, and returns across more than 190 pools.
DeFi is a living creature that continues to evolve week after week. And, with the launch of the eth2 Beacon Chain going live on December 1st at 12 PM UTC, we will witness how one of the most important moments in the history of Ethereum impacts the industry. Stay tuned, and happy farming!
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!