DeFi Pulse Farmer #35
Catch up on a new week in DeFi as we recap the Farm of the Week, the Conservative Farmer, the Governance Watcher, 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.
After slouching to $40B at this point last week, the DeFi’s total value locked (TVL) rebounded quickly to its current position of +$45B. The upswing in activity notably coincided with the BTC and ETH prices roaring back near all-time highs in recent days.
So will we be seeing new ATH prices for the cryptoeconomy’s bellwethers and a +$50B DeFi TVL in the coming days? That’s impossible to say, but the ecosystem’s momentum has clearly tilted bullish since last weekend.
Along with DeFi’s fresh activity surges, we’ve also just had a spate of big headlines drop. Recent developments of note include:
New AMM protocol Integral hit mainnet — Integral wants to become the “world’s last exchange.” To do that, the project is maintaining a continuous vampire attack to become ultra liquid. With big backers and hundreds of millions of dollars already having flowed into Integral, this is a project DeFi won’t be able to ignore.
Synthetix Staking added support for Optimistic Ethereum L2 — The name of the game in DeFi this year is scaling, and Synthetix is one of DeFi’s biggest apps. So that’s why all eyes are on Synthetix as the project just integrated the Optimistic Ethereum scaling solution with its Staking dapp. This is the trailblazing DeFi needs right now.
Payments giant VISA started settling payments directly on Ethereum — A few days ago VISA revealed that it began processing USDC payments atop Ethereum. It’s a huge win for Ethereum, USDC, and stablecoins in general, and it shows crypto going mainstream is a lot closer than many people probably suspect.
Lastly, let’s take a look at what DeFi’s best-performing tokens were this week. The largest 7-day movers since the last Farmer include AKRO (+41%), BZX (+37.1%), PERP (+34.8%), WNXM (+33.5%), and ZRX (+35%). The DeFi Pulse Index (DPI) rose 2% in the same span to hit $448.06.
Thank you to our sponsors DEXTF, an asset management protocol that makes managing and investing assets easier, and Yearn Finance, a suite of products in DeFi that provides lending aggregation, yield generation, and insurance on the Ethereum blockchain!
Farm up to 220% APY with mStable’s New fPools
mStable is a promising DeFi project focused on creating excellent infrastructure and non-custodial services around stablecoins and other pegged-asset tokens, like tokenized BTC products.
Something that caught our eyes this week, then, was mStable launching its first feeder pools (fPools).
These fPools are quite interesting for the mStable ecosystem. In short, their liquidity is comprised of a 50/50 split between an mAsset, e.g. mUSD, and a pegged asset, e.g. Gemini’s GUSD stablecoin, and they offer liquidity providers (LPs) swap fees, MTA rewards, and the possibility of additional token rewards if external projects want to further incentivize fPools that involve their assets.
As such, fPools are good for mStable’s liquidity, they’re good for users who want attractive yield opportunities with a low risk of impermanent loss (IL), and they can be good for external projects as another incentivization avenue to consider.
Out of the gate, mStable’s flagship fPool offerings include:
The mBTC/tBTC fPool (up to 220% APY currently)
The mBTC/HBTC fPool (up to 133% APY currently)
The mUSD/BUSD fPool (up to 142% APY currently)
The mUSD/GUSD fPool (up to 146% APY currently)
Note that when I say “up to” in the brackets above, I’m referring to the fact that mStable LPs can boost their MTA rewards up to 3x depending on the amount of staked MTA (vMTA) they have.
Accordingly, the figures above refer to the current ceilings of these boosted rewards, though even the base APYs can be attractive. For example, the mBTC/tBTC fPool is generating 73% APY in non-boosted MTA rewards right now, and that’s compelling enough by itself. mStable provides a boost calculator on every fPool page, so you can easily gauge what kind of rewards you can personally fetch.
If you’re interested in joining any of these fPool farms, you can follow these steps:
Navigate to mStable’s Pools dashboard and connect your Ethereum wallet.
Decide which fPool you want to enter, and then acquire/prepare your tokens. Remember these pools’ 1:1 ratio. If you’re wanting to join the mUSD/BUSD pool, this means you’ll want to have equivalent amounts of mUSD and BUSD.
Click on your fPool of choice, and you’ll be taken to its liquidity hub. Input the number of tokens you want to supply, and then press the “Deposit” button.
Unlock the tokens with two approval transactions.
At this point, the deposit interface will let you choose whether you want to directly stake your LP tokens, e.g. fPmUSD/BUSD tokens, into the associated fAssets Vault. This staking is how you earn fPool MTA rewards, so select the Vault option and then confirm your deposit transaction. Now you’re farming MTA!
mStable is a solid, reputable project, and these farms face a low risk of Impermanent Loss. Even still, though, you always want to farm responsibly. Do your own research, and never deposit more money in DeFi than you can afford to lose.
Sushi First Course — 2021 Q1 Update
TLDR: Popular DeFi trading protocol SushiSwap outlines all the advances its infrastructure and community made in the first quarter of 2021.
5 Ways Uniswap V3 Changes the World for Liquidity Providers
TLDR: The Sommelier Finance team breaks down how the coming Uniswap V3 system is going to change the way LPing works in DeFi.
Exploring New Frontiers with Aave
TLDR: DeFi lending project Aave kicks of its New Frontiers program, which will entail the protocol integrating with multiple scaling solutions starting with Polygon.
Announcing xU3LP: Fungible, Convenient Liquidity Provision for Uniswap V3
TLDR: The xToken team unveils xU3LP, a solution that will bring fungibility to a selection of Uniswap V3 NFT LP positions.
What you should know about Fei
TLDR: The Fei Protocol team explains the inner workings and nuances of the FEI stablecoin system, like how the project handles collateral risk.
Element Finance Raises $4.4M to Bring Liquidity to Fixed Rate Income and Interest Markets
TLDR: New DeFi fixed rates project Element Finance announces the details of its seed round, completed in Dec. 2020.
Farm between 17% and 43% APY with Curve’s sETH pool
They say money can’t buy happiness, though I do think it’s possible to farm happiness through a great ETH farm! 😆 👨🌾️
All joking aside, we’ve got a treat for your consideration this week with exactly that — a great ETH farm where you can earn good yields without much risk. The pasture in question?
Curve’s battle-tested, and its sETH pool is liquid and trusted in light of its current +$500M TVL. The sETH pool is also neat because you can use it to farm yield while maintaining complete exposure to ETH, which certainly has its merits considering ETH’s bullish price action lately.
As for yield, Curve’s sETH pool is presently fetching 17% APY in un-boosted CRV rewards and around 43% APY in boosted CRV rewards. If you’re interested in joining this farm, get some ETH and/or sETH ready, and then navigate to Curve’s sETH deposit dashboard. Here you can input your desired liquidity and choose whether you want to stake with your LP tokens straight away via the “Deposit & stake in gauge” button. Once your deposit is done, you’ll be farming CRV!
Curve is one of the safer projects in DeFi you can use, but even conservative farms require some degree of caution. Never invest more money than you can afford to lose!
How awesome would it be if you could jump in a website and make sure you don’t miss out on token airdrops? Today’s Plow of the Week, Airdrops, a new feature by Etherscan, has your back. Check it out and stay ahead of the curve ;).
Ethereum and DeFi are in a more bullish position than they’ve ever been before. If you step back and think about that for a second, it’s incredible. And really, all signs suggest there’s way more potential for further upside from here, so it’s certainly a great time to be a yield farmer! DeFi’s arrived, and while things may still be early there’s definitely no going back from here!
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!