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.
It was a down week for DeFi, as the ecosystem’s total value locked (TVL) slid from $65B to $58.79B since this point last Saturday. On the bright side, this TVL has been holding firm above $50B in recent weeks, so that’s a pretty awesome activity floor if it is, in fact, our current activity floor!
As for interesting DeFi happenings this week, a few things that caught our eyes and that we’re tracking closely right now include:
-
+1.3% of bitcoin’s entire monetary supply now exists as “wrapped” tokens on Ethereum. That’s not really surprising, of course, considering there are currently a myriad of ways to productively put your BTC to work in Ethereum DeFi. And it’s precisely these teeming opportunities that will make it so +10% of the entire bitcoin supply will be on Ethereum in the next 1-5 years. We’re calling it now!
-
InstaDapp just completed a $10M funding round. The DeFi smart wallet suite makes the UX of interacting with DeFi a breeze, so this new raise forebodes the future: UX solutions are going to be increasingly popular and in demand as new users continue to come around to the possibilities of DeFi.
-
Polygon and 0x deploy $10.5M warchest. The Ethereum-focused sidechain and the popular DEX protocol are using the new windfall in a bid to bring in new DeFi builders and users to Polygon’s PoS scaling solution. This solution has boomed in popularity lately as users have flocked to affordable and rapid DeFi transactions, so it will be interesting to see what happens when there are even more dapps available to use on the project!
Your takeaways, then? Ethereum’s position as a huge DeFi hub is solidifying, new DeFi hubs like Polygon are blooming as offshoots around Ethereum accordingly, and UX advances are going to be important for fostering further growth from here.
Zooming out, let’s review the week’s best-performing DeFi tokens per usual. We just saw decent 7-day runs from KEEP (24%), BOND (+6%), and LDO (+4%), but beyond these assets, there was a whole lot of red on DeFi’s weekly price charts. In this span, the DeFi Pulse Index (DPI) dropped 24.58% to $302.93.
Thank you to our sponsors DEXTF, an asset management protocol that makes managing and investing assets easier, and O3 Swap, a cross-chain Aggregation Protocol that integrates fragmented liquidity across blockchains.
Accumulate and bundle yield generating assets with your favorite longs on DEXTF today, and access the best trading prices on a one-step platform with O3 Swap.
Farm the Newest DeFi Pastures via Curve’s TriCrypto Pools!
Curve became one of the brightest stars in decentralized finance by providing the young DeFi ecosystem with a premier venue for super-efficient trading of same-pegged assets, e.g. stablecoins and ERC20 bitcoin projects like WBTC.
But that was Curve V1. The competition revved up earlier this year when Uniswap, hitherto DeFi’s leading exchange for non-pegged assets, rolled out Uniswap V3. This breakthrough upgrade gave Uniswap the advantage of concentrated liquidity, meaning the popular DEX can now also compete with Curve on Curve V1’s bread and butter, efficient trading of same-pegged assets.
Powered by an innovative new algorithm, Curve V2 turns the tables by being able to facilitate trading around non-pegged assets as efficiently or at times more efficiently than Uniswap V3. Ka-pow! 💥
To break the new Curve V2 system in, Curve’s launched a flagship new liquidity pool dubbed the TriCrypto pool. Tri, because the pool’s deposits are composed of USDT, WBTC, and ETH — i.e. a stablecoin and then the cryptoeconomy’s two most popular cryptocurrencies.
The result? A pool that offers traders tons of liquidity, with little slippage to speak of.
That said, one of the newest DeFi pastures around right now is earning yield by providing liquidity to the TriCrypto pool. If you’re interested in doing this, you’ve got two options as the pool has implementations on both Ethereum and Polygon. The only distinction? The Ethereum pool only supports USDT, WBTC, and ETH currently, while the Polygon pool supports USDT, USDC, DAI, WBTC, and ETH.
To join the Ethereum pool, you can follow these steps:
-
After preparing your crypto, go to Curve’s TriCrypto deposit page and connect your wallet.
-
In the deposit interface, input the amount of liquidity you’d like to supply. You can choose to supply “all coins in a balanced proportion,” “use the maximum amount of coins available,” and so forth.
-
Click on the “Deposit” button, and then confirm the ensuing transaction in your wallet. Once that’s completed you’ll be earning yield for serving as an LP for the Ethereum TriCrypto pool.
To join the Polygon pool, follow these steps:
-
After preparing and bridging your desired tokens to Polygon, go to Curve’s Polygon TriCrypto deposit page and connect your wallet.
-
Then, everything’s the same as with the Ethereum-based deposit process: input the amount of liquidity you want to supply, press “Deposit,” and fire off your deposit transaction. Voila! You’re a TriCrypto LP on Polygon now.
-
Of course, keep in mind that these pastures aren’t spinning out tons of yield. The base APY is ~4% currently and more yield from CRV rewards is incoming. On the flip side DeFi’s about pioneering, and participating in this TriCrypto pool is certainly that, so if you’re the pioneer type do consider checking out these pools!
The TriCrypto pool has been audited by MixBytes and ChainSecurity, and Curve has a stellar track record so far, so it’s reasonable to consider these pools on the safer side of things. However, you know the drill: there are few ironclad guarantees in DeFi, so only ever yield farm after you’ve done your own research and with money you can easily afford to lose.
Farmers can enhance this week’s farms with our sponsor Alpha Finance. Its recently launched Alpha Homora V2 allows farmers to do leveraged yield farming on pools that are on Curve, Balancer, SushiSwap, and Uniswap. Farmers can also lend assets such as ETH, DAI, USDT & USDC.
In Alpha Homora V2 farmers can open leveraged yield farming positions for selected pools and, similar as in Alpha Homora V1, farmers don’t need to have equal value of both tokens to yield farm. Head over to Alpha Homora V2 and start farming or lending today!
-
Uniswap V3: The Universal AMM
TLDR: Paradigm’s Dan Robinson outlines how Uniswap V3 is so advanced it can be used to simulate the design of other popular DEXes like Balancer and Curve. -
Decentralized Finance: (DeFi) Policy-Maker Toolkit
TLDR: The World Economic Forum (WEF) publishes a primer on DeFi to help policymakers around the world grow the ecosystem. -
Introducing Circle Yield
TLDR: USDC creators Circle unveil Circle Yield, a “white-glove offering” for helping companies earn yield via capital deployments into USDC. -
OHM x FRAX: A New Breed of Partnership
TLDR: OlympusDAO and Frax Finance are launching an OHM-FRAX liquidity pool as part of a new partnership between the two projects. -
London Upgrade Overview
TLDR: The Ethereum Cat Herders publish an excellent guide on Ethereum’s coming London upgrade, which will implement a series of Ethereum Improvement Proposals (EIPs). -
OKEx integrates with Polygon
TLDR: Large cryptocurrency exchange OKEx integrates with Polygon’s PoS sidechain, ensuing users can withdraw directly from OKEx to the Ethereum scaling solution.
Farm ~40% + UNI fees on stables farms via xToken’s U3LP tokens!
Uniswap V3 is a beast of engineering. Yet one common complaint we’ve seen around the new protocol is that its NFT-based, concentrated liquidity model is more complicated to use than Uniswap V2.
The good news for Uniswap? A host of third-party projects are rising up and working on solutions to make deploying capital to Uniswap V3 easier. One such project to watch right now is xToken, whose fundamental raison d’être is providing an ERC20 staking system for simplifying DeFi.
xToken accomplishes this by offering “set-and-forget” tokens that are wrapped representations of popular but somewhat tricky DeFi activities. For instance, manually staking SNX on Synthetix isn’t friendly to newcomers, so xToken created xSNX, a wrapped expression of Synthetix’s SNX staking process. The idea? Now you can simply acquire xSNX to enjoy the perks of Synthetix staking in an automated fashion.
So that brings us to the newest xTokens on the block, the project’s xU3LP tokens. In short, these tokens are fungible, ERC20 representations of non-fungible Uniswap V3 LP positions.
This works because of what’s called “common shared positions” — xToken takes the liquidity of V3 LP NFTs that share the same price range/fee tier and then uses this liquidity to underpin a given xU3LP token. Accordingly, these are grab-and-go tokens that abstract away the need for directly and manually providing liquidity on Uniswap V3 yourself.
Right now, xToken has 3 xU3LP offerings live (the numbers on the right refer to price ranges):
The tl;dr is that the “a” token facilitates maximizing DAI-USDC LP yield, the “b” token facilitates maximizing USDC-USDT LP yield, and the “c” token facilitates maximizing sUSD-USDC LP yield. If you’re interested in earning from these pools, simply head over to your xU3LP token of choice on the xToken platform. Here, you can mint xU3LP by providing either side of the underlying collateral, e.g. DAI or USDC in the case of xU3LPa. Then you can stake your xU3LP tokens at the xToken cafe dashboard to harvest those extra XTK rewards.
These tokens are an experimental new form of yield farming, so keep that in mind before making any deposits. If you are interested, try testing the waters with a small sum of money you can afford to lose and only after you’ve done your own research!
Honest farmers need all the info about Uniswap & Sushiswap pairs that they can get their hands on, so today’s Plow of the week will catch your attention. DEXtools allows farmers to track live new pairs and to track big swaps, check it out!
DeFi may be a bit of a rollercoaster lately, up and down and ‘round again. Regardless, there are some really excellent yield farms going on at the moment, so keep your head down and keep farming safely and you’ll be in good shape!
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!