DeFi Pulse Farmer #20
Catch up on a new week in DeFi as we recap a new TVL ATH, Coinbase's IPO filing, Compound Chain, the Farm of the week, the Conservative Farmer, 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, or 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.
Since last Saturday, DeFi’s total value locked (TVL) climbed from $14.47B to a new all-time high just over $16B as of this Friday. Cheers to that!
The rise keeps DeFi within striking distance of $20B by year’s end and was spurred on by a blockbuster week for the cryptoeconomy. In just the past handful of days, we’ve seen:
The bitcoin price hit a new record high of $23,704.85 USD.
The ETH price, currently trading over $650, hit yearly highs.
The derivatives powerhouse CME Group unveil coming ETH futures products.
Crypto exchange giant Coinbase formally begin the process of formalizing its much-anticipated public offering.
Speaking of Coinbase, the company also made waves around DeFi this week for finally listing Aave’s and Synthetix’s respective governance tokens. The move comes after DeFi power users have been calling on the exchange to add support for AAVE and SNX for some time, their thorn having been that these assets have long satisfied Coinbase’s listing requirements.
The other major headline development that just dropped was Compound’s reveal of Compound Chain, an in-the-works blockchain that Compound’s builders aim to use to coordinate the protocol’s DeFi services across a range of blockchains.
Notably, under the proposed Compound Chain system Compound’s existing governance infrastructure would continue to live atop Ethereum and going forward serve as a coordinating hub for the project’s multi-chain activities. Yet more than a few people panned the proposal as Compound effectively looking to jump ship from Ethereum. We’ll have to wait and see if the decision kicks off a domino effect of prominent DeFi projects looking to roll out their chains.
We can’t forget about this week’s best-performing DeFi assets, either. Some tokens that had strong runs over the last 7 days include BNT (+48.7%), SUSHI (+43.1%), SNX (+42%), ALPHA (+30%), and REP (+33.1%). And amid this latest DeFi’s upswell, the DeFi Pulse Index (DPI) also unsurprisingly just climbed +21% to $117.
Thank you to our sponsors TrueFi, the uncollateralized lending platform from the makers of TUSD, Vesper, an upcoming platform for professional DeFi products, starting with set-and-forget pools for HODL'ing and growing your assets, and DEXTF, an asset management protocol that makes managing and investing assets easier.
Earn competitive yields & farm at TrueFi.io today, sign up to Vesper to be among the first to try Vesper's incentivized beta, and accumulate and bundle yield generating assets with your favorite longs now on DEXTF.
Farm 670% APR via Basis Cash Liquidity Mining
Basic Cash is an interesting oncomer in DeFi’s recent surge of algorithmic stablecoins because its design is novel in the young stablecoin arena.
Namely, the protocol relies on a tri-token model centered around Basis Cash (BAC, the project’s medium of exchange that’s pegged to Dai), Basis Bonds (BAB, which can be minted and redeemed for BAC at a premium), and Basis Shares (BAS, the holders of which are awarded new BAC tokens when the protocol’s treasury is full enough).
Using these three tokens in an algorithmic central bank system is how the Basis Cash protocol goes ‘round, then, and at the heart of this system is the Uniswap v2 BAC-DAI liquidity pool.
That’s because a time-weighted average of the pool’s exchange rate is taken once a day for reference by the protocol’s stability mechanism, which, depending on how far the BAC price is above or below 1 DAI, then automatically conducts contractionary or expansionary supply pressure as needed.
This means that the more liquid this Uniswap BAC-DAI pool is, the more efficient and accurate Basis Cash’s stability infrastructure will work. The importance of this liquidity is why the young protocol is incentivizing Uniswap BAC-DAI liquidity providers (LPs) with an attractive and ongoing BAS distribution program.
How to Farm BAS Through the Uniswap BAC-DAI Pool
Here, let’s assume you already have an equivalent amount of BAC and DAI and are ready to start serving as an LP.
First, you’ll want to take your tokens to Uniswap and deposit them into the BAC-DAI pool. Take your ensuing BAC-DAI UNI LP v2 tokens over to Basis Cash’s Bank dashboard, which looks like so:
Select the BAC-DAI LP farm, and kick the process off by approving the deposit transaction on the following screen.
Now you can deposit your LP tokens, and after you do that you’ll automatically start accruing BAS rewards! According to the Pools page of Yield Farming Tools, these rewards are generating over 670% APR for farmers right now.
Ultimately, 750k BAS will be distributed to Uniswap BAC-DAI LPs, and this first month of the distribution campaign has a daily allocation of 6,250 BAS. This allocation is reduced to 75% every 30 days, so keep in mind how this yield farm’s APRs will be affected accordingly going forward. And, as always, never jump into a farm with more money than you can afford to lose!
TLDR: Popular DeFi lending protocol Compound announces plans for Compound Chain, an independent blockchain intended to connect Compound’s services across many blockchains.
Breaking Aave Upgradability
TLDR: The Trail of Bits team publishes a report on a since-fixed vulnerability they identified that could have been used to break certain Aave smart contracts.
Loopring and DeversiFi announce a Layer-2 Committee
TLDR: The Loopring and DeversiFi DEXes announce L2², an industry working group focused on layer-two scaling topics.
CME Group to Launch Ether Futures on February 8, 2021
TLDR: The world’s biggest derivatives marketplace reveals its launching ETH futures products early next year.
DeFi777 v1 Launch!
TLDR: DeFi777, an ERC-777 token wrapper project for DeFi, details its formal rollout.
Badger DAO to Distribute $BADGER to Gitcoin Round 8 Donors
TLDR: BTC-focused DeFi upstart Badger DAO unveils an allocation of 10k BADGER to donors who participated in Gitcoin’s latest grants round.
Vesper Incentivized Beta Launch — Dec. 22*
TLDR: Vesper announces the beginning of its incentivized beta, which will distribute the platform’s governance token to early users.
*This is part of our sponsored links series.
Farm Curve’s sUSD Pool for up to 46.6% APR
Curve stole the show as DeFi’s premier stablecoin DEX this year. Similarly, Synthetix also entered the limelight as a trailblazing protocol around synthetic assets and yield farming.
At the crossroads of these two promising projects is a conservative and battle-tested farm for your consideration: Curve’s sUSD pool, which is centered around Synthetix’s native sUSD stablecoin.
What’s so great about this pool is that it offers its LPs a trifecta of rewards, namely trading fees, CRV, and SNX.
Since the sUSD pool includes DAI, USDC, and USDT too, you can deposit your desired combination of these stablecoins through Curve’s sUSD pool deposit dashboard. Using this same dashboard, you can take the LP tokens you receive and stake them through the pool’s gauge to unlock boosted CRV rewards, which offer up to a 45.37% APR presently.
You can also re-visit DeFi Pulse Farmer #5, where we go over the necessary steps on how to stake CRV rewards.
This farm is quite stable by DeFi standards but always farm smartly anyway. Do your research, and make sure you completely understand the steps you’ll be taking. Nothing wrong with a cautious mindset in this space!
This week’s plow of the week goes to vfat.tools, a cool new tool that provides real-time data about APYs, amount of rewards, and more, across more than ten protocols!
With the way the end of 2020 is shaping up for the cryptoeconomy in general, it seems increasingly clear that 2021 is poised to be another boom year for DeFi. But let’s not get ahead of ourselves, as there’s really no telling what the near future ultimately holds in store for us. All we know for now? DeFi has never been more promising and more primed for success. This reality could spell great things for the ecosystem in the months ahead!
All info in this newsletter is purely educational and should only be used to inform your own 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!