👩‍🌾 Exploring the DAI-USDC LP vault on Beefy Finance

🦀 DeFi TVL decreases — On April. 12th, 2022, the total value locked (TVL) in Ethereum DeFi projects was $76.12B according to DeFi Pulse, almost 7.4% lower than the value we saw a week ago.

😳 Driving crypto news this week — UK considering regulations for various cryptocurrencies amid a global effort, WorldPay to offer merchant settlements in USDC

• The United Kingdom has announced plans to regulate some cryptocurrencies as part of a larger strategy to become a worldwide hub for digital payments, at a time when regulators in the United States and Europe are rushing to draft crypto rules. Rishi Sunak (Treasury Chief) has also asked the Royal Mint to generate a non-fungible token (NFT) by the end of summer 2022. There are also proposals to investigate the possibility of issuing UK government debt using crypto technology.

• On 6th April 2022, Worldpay (payments infrastructure service) announced that merchants would be able to receive a direct settlement in the stablecoin USDC (USD Coin). The move, made in collaboration with Circle, will allow both crypto-native and traditional firms to integrate stablecoin settlement into their operations.

💸 This week’s best-performing assets:

• 📈 Kyber Network Crystal (KNC) +23.2%

• 📈 Balancer (BAL) -3.8%

• 📈 Rari Governance Token (RGT) -13.4%

  👀 Things you should keep an eye on:

👛 The $DPI pulse — The DeFi Pulse Index ($DPI) is presently trading at $171.86, a decrease by 22.61% since Tuesday, April 5th. 

• Luna & Avalanche announce $100M treasury swap
  TLDR: Terra diversifies its holdings beyond Bitcoin by purchasing AVAX, the Avalanche native token. Luna Foundation Guard, a Singapore-based nonprofit organization, announced a $100 million treasury swap with the Avalanche Foundation on April 7, 2022;

• Coinbase suspends payments and buy orders within three days of India launch
  TLDR: Coinbase has disabled its app’s functionality for the Unified Payments Interface (UPI) payment instrument in India, rendering its eponymous exchange inaccessible for any purchase orders less than four days after introducing the trading business in the world’s second-largest internet market;

• SIX Swiss Exchange Adds two new Bitcoin and Ethereum ETPs
  TLDR: At SIX Swiss Exchange, Helveteq is launching two new crypto exchange-traded products (ETPs) on Bitcoin (Bitcoin Zero / BTCO2) and Ethereum (Ether Zero / ETH2O). This year, Helveteq is the third new crypto ETP issuer to join SIX;

• Robinhood releases crypto wallet and plans integration with Bitcoin Lightning Network
  TLDR: Robinhood Markets (HOOD) announced on 7 April 2022 that it has activated its crypto wallet for 2 million “qualified” consumers, allowing for widespread digital asset transactions in the formerly password-protected investment app;

• Grayscale kicked SushiSwap and Synthetix from its DeFi Fund
  TLDR: After the two crypto assets failed to meet the specified minimum market capitalization, Grayscale removed tokens from crypto-derivatives decentralized exchange Synthetix and decentralized exchange SushiSwap. Avalanche (AVAX) and Polkadot (DOT) have been added to the crypto asset manager’s Digital Large Cap Fund, while Cosmos (ATOM) has been added to its Smart Contract Platform Ex-Ethereum Fund (GSCPxE Fund). 

🚜 Exploring the DAI-USDC LP vault on Beefy Finance

StellaSwap’s DAI-USDC pool is an opportunity to put your stablecoins to work! StellaSwap is the leading decentralized exchange on Moonbeam (one of Polkadot’s smart contract platforms). To enter these pools, users will have to provide equal amounts of DAI and USDC. 

Once a user has received their DAI-USDC LP tokens, they may choose to stake them on StellaSwap under the “Farm” section, or they may stake them with Beefy Finance (a decentralized, multi-chain yield optimizer) who are offering an additional boost.

✅ Advantages of the farm: 

• The pool is composed of two stablecoins, so long as they maintain their peg, then users may not experience impermanent loss; 

• The pool has a decent amount of Total Value Locked (TVL), so one can assume the yield will not drastically decrease from new pool entrants diluting farmers;

• StellaSwap and Beefy Finance have undergone multiple audits;

• The pool is auto-compounding, hence less maintenance is needed;

• The pool being composed of two stablecoins prevents one from having correlated exposure to the overall market, so if the market has a bad week, the pool will be unaffected. Additionally, DAI and USDC are two of the most trusted stablecoins.

❗ Risks to keep an eye on:

• By optimizing the yield via Beefy, one takes on additional protocol related risk;

• If DAI or USDC were to lose peg, the pool would experience a large amount of impermanent loss;

• Since the farm is composed of two stablecoins, the yield is lower than what you could find in a riskier opportunity.

Interested in trying this opportunity? You could:

Beefy Finance has been audited, but there are no ultimate guarantees in DeFi. So, always do your own research, and never invest more money into any project than you can afford to lose.

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How can web3.0 make the most of DeFi?

DeFi was the first Web3.0 sector to gain traction; it is now more popular than Web3. The DeFi Summer of 2020 boosted the blockchain sector, bringing decentralized applications (dApps) out of the hypothetical realm. However, soon after the advent of DeFi, an incorrect belief arose that DeFi represented the entirety of Web 3.0 and that all other dApps were still phantoms, with public blockchains just existing to support DeFi.

However, this is a limited assumption, evidenced by the rise of DAOs, GameFi and NFTs. Also, “beyond finance” has always been the long-term goal of DeFi. Here’s how Web3 can effectively utilize DeFi:

• Allow DeFi to be the Web3 engine rather than a fleeting flower blooming for its own sake. 

•  DeFi’s long-term viability is contingent on its link with the decentralized digital economy. Web3 non-financial sectors may thrive by leveraging DeFi’s convenient transaction architecture and ample funding.

“In a nutshell, DeFi and Web3 require each other in the same way as a car’s engine and body require each other” -Guneet Kaur

All info in this newsletter is purely educational and should only be used as research. DeFi Pulse is not offering investment advice, endorsement of any project or approach, or promising any outcome. This post is prepared using public information (which does not account for specific goals or financial situations) and links provided to third-party sites are for informational purposes. Such sites are not under the control of DeFi Pulse, so DeFi Pulse or the author are not responsible for the accuracy of the content on such third-party sites. Be careful and keep up the honest work!