We’ve added a new product for our Insights and Institutional subscribers today – and the first edition just went out today!
The purpose of the Weekly Farms is to provide you with the best stablecoin/BTC/ETH farming strategies out there that have no or relatively low impermanent loss risk. We think this is an interesting niche within the farming ecosystem. Occasionally, though, we may explore or highlight tasty opportunities outside of this niche. Check out our subscriptions tiers today to gain access!
Harvest Finance is a yield aggregator that offers DeFi users the ability to access a wide variety of yield farming opportunities from a single interface. Going beyond just aggregating strategies, Harvest also saves users a significant amount of money on gas.
People deposit funds into a vault for a particular asset and strategy, like a USDC vault that farms CRV on Curve Finance. Instead of hundreds of farmers individually claiming and selling their CRV, the vault does it for all of them in a single transaction.
If this sounds eerily similar to yEarn Finance, that’s because it is. yEarn’s token, YFI, was the poster child for DeFi Summer, but the protocol has come to somewhat of a standstill in recent months.
Harvest has been adding new strategies and has achieved a fairly sticky TVL despite succumbing to one of DeFi’ largest exploits. Additionally, its native token, FARM, is already undergoing a re-pricing as the market takes note of Harvest’s growth.
- Market Overview with Kevin Kelly.
- Bitcoin Outlook + CRV Update with Paul Burlage.
- SUSHI & UNI Comparison with Ashwath Balakrishnan.
- NBA TopShots Highlight with Alex Gedevani.
- Mirror & Terra Analysis with Medio Demarco.
- State of Algo Stablecoins and Our Upcoming ESD Proposal with Yan Liberman.
Cosmos’ Catalysts; BSC Makes Some Noise by Medio Demarco
- In the medium-term, scalability is on its way to Ethereum via layer 2 alternatives but those are still immature, have different security assumptions and can lack composability. This allows competing base-layer chains to gain market share. We have our eyes on two projects, Cosmos and Binance Smart Chain.
- With Cosmos, each application is its own layer-1 (i.e, “application-specific blockchain”). This allows them to be optimized for their specific use case and may also be beneficial for value accrual, given it’s a necessity for security. When coupled with the standard Tendermint PoS consensus, scalability goes much higher. Tendermint based chains can typically do at least a few thousand transactions per second, relative to Ethereum’s ~14.
- There are two catalysts on the horizon that make the Cosmos ecosystem particularly interesting at the moment. The first is the Stargate upgrade which would use the IBC for the first time. The IBC protocol allows Cosmos app-chains to communicate with one another. The second catalyst is the upcoming launch of THORChain’s multichain mainnet, which would pave the way towards the first decentralized and secure peg-zone. In layman’s terms, THORChain could leverage its existing infrastructure to bring external assets (i.e. BTC & ETH) into the Cosmos ecosystem.
- While the Binance Smart Chain (BSC) is a more centralized solution relative to other prominent layer 1s, its utility at the moment and brand recognition is making a lot of noise. Over the past 30 days, DeFi TVL on Binance Smart Chain has risen ~$3.5B, driven primarily from growth in Venus and PancakeSwap. In the near-term, BSC could continue to see strong growth and become the starting crypto experience for many newcomers.
- As it stands now, both Cosmos and Binance Smart Chain offer their own unique opportunities, which our research team is continuing to explore. We plan to release full thematic reports analyzing the ecosystems of both in the coming weeks. The time of serious competition for Ethereum may just be warming up.
Revenge of the Yam (Yam Finance) by Alex Gedvani
- Never let missteps count out a project’s future success. Many projects like Harvest, Pickle, Sushi and even Aave were able to rise from the ashes to become a standard in the DeFi space. This is a story about Yam Finance and how it’s now in its third version which offers new services for DeFi users.
- Degenerative.Finance: launched by Yam Finance in tandem with UMA to develop a number of DeFi derivatives. These derivatives can range from TVL Futures to uStonks, a synthetic that tracks an index of ten stocks that are most commented on r/WallStreetBets. uGas is the first product of the Degenerative.Finance arm and will be used as a synthetic gas futures token that tracks gas, creating a hedge against high gas costs. In addition to going long or short gas and trading the tokens, there’s also the option to mint and LP uGas.
- Umbrella: an insurance protocol offering customizable pool creation, NFT based protection, and a simple to use design. With simplicity in mind, team shifted from a funding rate model to an NFT-based model, enabling passive management of one’s protection.
- YAM DAO Set (YDS): collaboration with Set Protocol on an initiative for its own Yam DAO set. The treasury itself can have subdivisions across investments, insurance, and capital for other use. Yam plans to offer YDS as an investment to other DAOs, reducing their legwork when it comes to capital. Assuming AUM traction, the cut of revenue streams would be another benefit to the Yam protocol.
- YAM Factory: a decentralized incubator for novel DeFi concepts based by community input. It’ll encourage teams to build products for Yam and in return receive funding and other support across marketing/design etc.
The Curve Bull Case, StakeDAO Strategies, and Managing Mbappé by Jonathan Erlich
- Julien Bouteloup, CEO of Stake Capital and Curve team member, believes that the next boom will be in stablecoins. Projections suggest that stablecoins will capture 50–60% of the total crypto market due to central bank digital currencies (CBDCs). To put it in perspective, current USD stablecoin supply is ~$31B, while M1 money supply currently sits at ~$6,900B.
- Curve is well positioned to take market share as it already serves as the backbone for stablecoin trading in DeFi. At current stablecoin supply, Curve is generating $17M in annualized fees for CRV lockers and has facilitated more than $25B in cumulative volume. Its market cap is around $650M which implies a P/E ratio of 38, if fees are consistent with the last 20 weeks.
- Julien’s recent project, StakeDAO, aims to be the go-to-place for retail investors looking for a profitable yield strategy in the DeFi space. StakeDAO is going to offer several custom strategies: Flashboys 2.0, Blackpool, Liquidation v1 and APY Hunter.
- Blackpool is a financial services company focused on the NFT space. They focus on NFTs with utility that can generate passive income. For each vertical they operate in, they hire managers whose job is to play the game in the best possible way. Blackpool, in turn, provides their managers with the tools and assistance to do so.
MetaMask: Aggregating The Aggregator by Paul Burlage
The unfolding MetaMask story reveals valuable insights on the emergent and ever-evolving Ethereum defi stack. In particular, aggregators, as well as underlying liquidity protocols.
With the rise of DEX aggregators, smart-order routing made it more efficient to trade on aggregator venues rather than going straight to the liquidity source (for the most part). The growth in both 1inch and Matcha (0x project) volume exemplifies this trend. DEX aggregators source liquidity, while AMMs/MMs must surface liquidity, and therefore, aggregators compete for flow, while AMMs compete for LP capital. Two different ball-games, but both still highly competitive incentive games. It is also interesting to think about who is the stickier customer between traders and LPs.
As mentioned, we will continue to iterate on the design of our Delphi Debrief based on your feedback—so please let us know which section you enjoy the most and what else you’d like to see!