Start your week with the only DeFi alpha roundup you need.
Ethereum takes one step closer to the Shanghai Upgrade this week, with the Zhejiang Testnet as the first public withdrawal testnet. Avalanche sees a bunch of subnets launch as well, including the first institutional subnet. Finally, the Cosmos sees movement in the ecosystem being largely driven by Ethereum Virtual Machine (EVM) compatible chains activity.
What a week, let’s see what went down this past week in DeFi.
Join us in showcasing the cryptocurrency revolution, one newsletter at a time. Subscribe now to get daily news and market updates right to your inbox, along with our millions of other subscribers (that’s right, millions love us!) — what are you waiting for?
Overview: A Dovish Fed Sends the Market Higher
The Total Value Locked (TVL) across all chains rose 2% this past week, recovering from a dip at the end of January to surpass $48 billion. The week’s rise is largely attributed to the dovish stance from the Fed during the Federal Open Market Committee (FOMC) meeting held this week, which sent equity markets soaring. Notable increases in TVL include Canto and Injective with rises in the 30s and high teens respectively. Interestingly, Terra Classic also saw a huge jump due to its token price increase possibly signaling retail mania.
Source: Defillama.com
Welcome to Alpha Central
ZK roll-ups have long been treated as the final form of all L2s over the currently running optimistic roll-ups. Steve Goldfeder from Offchain Labs, the team behind Arbitrum, weighs in on why he disagrees.
Founder of cross-chain bridge Nomad, James Prestiwch, lays out security risks relating to their competitor, LayerZero, resulting in several public (and heated) tweets addressing the risks outlined.
Thor Hartvigsen is back with a thread on decentralized stablecoins, covering some of the highly anticipated stablecoin launches by DeFi giants, Aave and Curve, as well as one by Arbitrum’s flagship options protocol, Dopex, among others.
Andre Cronje drops a Medium piece on one of the latest DeFi trends, bringing real world assets (RWAs) to DeFi. Cronje opines that RWAs are not what DeFi needs to be revived, but rather, “The future of DeFi is DeFi.”
Ape’s Prologue drops their catalysts to watch for in February 2023, including the upcoming NFT and ZK narratives.
Ethereum: Zhejiang Today, Shanghai Tomorrow
Ethereum’s first public withdrawal Testnet, dubbed the ‘Zhejiang Testnet’ has been deployed, as part of the preparations leading up to the highly anticipated Shanghai and Capella upgrades. This set of upgrades marks the biggest upgrade to the Ethereum network since the Merge in September 2022.
Threshold Network goes live with their Mainnet v2, allowing BTC to be bridged to Ethereum via their token tBTC. This allows BTC holders to put their coins to work in DeFi on the Ethereum network.
Ethereum’s top decentralized exchange (DEX), Uniswap, concludes their governance vote for the selection of the bridge for their BNB Chain deployment, announcing Wormhole as the selected bridge. The vote for deployment on the BNB Chain is still underway and has heated up over the weekend as crypto fund, a16z, votes against it after LayerZero, a bridge backed by a16z, was not selected as Uniswap’s bridge of choice.
DeFi bridging protocol, Stargate Finance, proposes a decision to reissue all STG tokens. The move aims to thwart any potential illicit transfers from compromised Alameda wallets after the collapse of Alameda and their sister company, FTX.
L2s: GMX Partnerships on Fire
The Optimism Foundation puts their Bedrock Proposal to the governance vote this week. Bedrock, which will be executed on 16th March when the vote passes, brings a modular stack to Optimism, separating consensus, execution and settlement on the chain.
Redacted Cartel launches Pirex, a liquid wrapper for GMX and GLP tokens. This allows GMX and GLP stakers to make the most out of their token and easily compound their rewards, creating a positive flywheel between GMX and Pirex. Some might even say, the liquid staking derivative (LSD) narrative has come to GMX with Pirex.
Lyra also launched on Arbitrum last Wednesday, integrating with perpetual DEX, GMX, to hedge against their vaults. This is possible due to the Newport upgrade, which allows Lyra to integrate with any L2 perpetual DEX.
Jump-backed oracle protocol, Pyth Network, announces support for Arbitrum. Originally focused on the Solana ecosystem, Pyth expands to Arbitrum, citing its dominance as the reason for the shift.
Sovereign Labs launched this week as well, bringing the Sovereign SDK to the masses. Zero-knowledge rollups are notoriously hard to code, and Sovereign aims to lower the barriers to entry with their open-sourced toolkit.
Solana: Friktion’s New Home
After the announcement of the shutdown of option vault protocol, Friktion, Ribbon Finance announces a migration plan for users looking for vaults to deposit their assets, with a special airdrop for users who migrate before 17th February.
Fantom: fUSD V2
Fantom announces the upcoming release of fUSD v2, a newer version of the stablecoin backed by the FTM token. Although the release timeline has not been announced, it is noted that current fUSD bad debt will be liquidated in the process.
Avalanche: Subnets, Subnets Everywhere
Institutional structured products provider, Intain, launches a subnet on Avalanche, marking the first institutional subnet ever. The subnet is set up as a marketplace for tokenized asset-backed securities.
Dexalot launches as an Avalanche subnet as well, bringing central limit order book (CLOB) DEXs to Avalanche. Dexalot is also launching with more than $1 million in incentives for users on the subnet.
GMD Protocol, a yield aggregator built on GMX has partnered up with top Avalanche top DEX, Trader Joe, as they launch in the same week. GMD has also formally released a proposal for an OTC swap with GMX of their treasuries to further future partnerships and collaboration between the two protocols.
Cosmos: EVM is Still King
Osmosis announces Osmosis Stableswap, an asset pool made up of BUSD, USDT and USDC. Historically, this was a position filled by Curve Finance on EVM-compatible chains, making this a huge milestone for the Cosmos and Osmosis. Moreover, Osmosis Stableswap is cross-chain, allowing deposits from Avalanche, Polygon and Ethereum.
Mars Protocol is back from the dead and lives on in the Cosmos. Originally a protocol on the original Terra blockchain, Mars has finally relaunched this week and is airdropping their new MARS token to former MARS holders on Terra.
Evmos drops their Evmos Manifesto, possibly due to the overwhelming success of Canto, another Cosmos-based EVM-compatible chain, in the past month. Canto has seen almost a 200% increase in TVL on their chain since the beginning of the year.
Delphi Labs and Attic Labs showcase their early deployment of passive concentrated liquidity (PCL) for Cosmos-compatible chains. This deployment aims to improve capital efficiency, reduce toxic flow and facilitate algo-supported passive liquidity provision.
World Mobile is dedicating resources to building a Cardano sidechain, specifically to connect it to the Cosmos ecosystem. This will be constructed using Cosmos’ Tendermint protocol which most Cosmos app-chains are built on.
Another Week, Another Airdrop
NFT automated market maker (AMM) protocol, Sudoswap, announces their long anticipated airdrop, SUDO. Holders of the XMON token can also lock their XMON tokens to receive SUDO, in a lockdrop fashion.
As the market continues to rally on a dovish Fed, builders continue to ship at an incredible rate. The past week has been packed with updates and new products. Stay tuned for next week’s edition and keep supporting your favorite projects, degens!
This article contains links to third-party websites or other content for information purposes only (“Third-Party Sites”). The Third-Party Sites are not under the control of CoinMarketCap, and CoinMarketCap is not responsible for the content of any Third-Party Site, including without limitation any link contained in a Third-Party Site, or any changes or updates to a Third-Party Site. CoinMarketCap is providing these links to you only as a convenience, and the inclusion of any link does not imply endorsement, approval or recommendation by CoinMarketCap of the site or any association with its operators.
This article is intended to be used and must be used for informational purposes only. It is important to do your own research and analysis before making any material decisions related to any of the products or services described. This article is not intended as, and shall not be construed as, financial advice.
The views and opinions expressed in this article are the author’s [company’s] own and do not necessarily reflect those of CoinMarketCap.
