This Week in DeFi – January 22

To the DeFi community,

This week, Curve and Synthetix are joining forces on new smart contracts that enable low slippage using synthetic asset.

One difficulty of making high value trades is slippage, or getting a progressively worse realized price as the trade eats up more and more sell orders. That drives up the average price of the target asset, which can sometimes result in big losses compared to a trade with no slippage.

Step 2 is that Synthetix is awesome for creating “synthetic assets” (aka synths) which are assets that trade like other assets, that are backed by another, entirely different asset. Basically, a plastic banana that I can buy and sell like a real banana.

— I’m just a doggie boi (@fubuloubu) January 16, 2021

 

Using the new collaboration, Curve swaps between native and synthetic assets, Synthetix facilitates the trade from one synth to another for a flat fee, and Curve makes the final swap back from virtual to the target native asset. Viola, swap millions between USDC and WBTC in a single transaction, largely slippage-free.

This is disruptive!

No more slippage 😍

Thanks to @synthetix_io, you swap between diverse assets with no slippage

Thanks to @CurveFinance between same representatives (e.g. DAI/USDC)

The only downside, it’s async

I am expecting A LOT of volumes

And looking for L2 👀😎 https://t.co/fammCg7R9S

— Emiliano Bonassi | emiliano.eth (@emilianobonassi) January 17, 2021

 

The advent of this type of super-low slippage trading is a prime example of the financial innovation DeFi makes possible by moving all the pieces of traditional banking systems into a digital, open-source ecosystem.

The amount of things that start clicking together when you stop thinking about separate system, and instead systems as a whole integrating, is honestly amazing. Lending is such a powerful and underutilized tool. The things we can do with it in defi are about to get scary

— Andre Cronje (@AndreCronjeTech) January 16, 2021

 

Slippage is not a new problem or unique to DeFi, so new tools like this will be a catalyst for bringing institutional investment to the industry, seeking an edge in traditional markets.

Yearn Finance launched the first new v2 yVaults for USDC, DAI, and HEGIC (with free transfers from v1 vaults!) alongside a new UI design this week, the first big step on a long road to much deeper integration with protocols across the DeFi landscape.

DAI Vault from @iearnfinance

🐵User
🏦Vaults v2
🧑‍🤝‍🧑Governance (🗳️Voting+✒️MultiSig)
💰Treasury
🦄UniswapV2Router02 @UniswapProtocol
🏦IronBank @CreamdotFinance
👻Flashloans @AaveAave, @dydxprotocol
💱Lend/Borrow @compoundfinance
🧠Strategist
🤖Keeper

h/t @arbingsam
🧵👇 pic.twitter.com/eVT5psuNpb

— vasa (@vasa_develop) January 18, 2021

 

Sushiswap is teaming up with Furucombo to build automation cubes that use Sushi liquidity pools, opening the door for more complex no-code strategies on the automation platform. It’s also the first set of cubes to be designed outside the Furucombo team, another nice collaboration between two rising projects.

The new protocols also kept rolling this week, with Saddle Finance bringing a new market for pegged tokens and stablecoins and Charm Finance launched their mainnet for decentralized options trading.

Lots of top DeFi builders have spent the last few months hyping up the type of products in store for 2021 that would blow minds and change the entire game, in crypto markets and beyond. We’re getting the first tastes of that now less than a month into the new year, and the best part is each DeFi innovation is likely to build on the last.

Every day it looks more like the only limit to our financial success will be our own imaginations.

Stay tuned!

Highest Yields: Fulcrum at 12.82% APY, dYdXNexo Lend at 10% APY

Cheapest Loans: CoinList at 3.00% APY, Compound at 7.24% APY

MakerDAO Updates

DAI Savings Rate: 0.00%

Base Fee: 0.00%

ETH Stability Fee: 2.50%

USDC Stability Fee: 0.00%

WBTC Stability Fee: 4.50%

Highest Yields: dYdX at 14.13% APY, Fulcrum at 12.6% APY

Cheapest Loans: CoinList at 1% APY, Aave at 7.09% APY

Charm Finance launches options trading mainnet, but warns smart contract audits are still in the works.

Perpetual Protocol clocks hundreds of traders, half a million in fees in the first month of mainnet.

Saddle Finance launches a Curve-style AMM with more than $4 million in VC backing.

C.R.E.A.M is keeps up with the times by adding new tokens to the platform.

 

CREAM debuts its plan for zero collateral loans in the yearn ecosystem.

 

Total Value Locked: $23.9B (up 11.6% since last week)

DeFi Market Cap: $40.35B (up 30.3%)

DEX Weekly Volume: $11.96B (down -2.5%)

DAI Supply: 1.44B (up 2.1%)

Total DeFi Users: 1,291,000 (up 3.7%)

[3LAU – The Defiant] – Building the Investable Layer of Music

[Ryan Sean Adams – Bankless] – DeFi will eat corporate debt

[Anthony Sassano – The Daily Gwei] – YFInflation – The Daily Gwei #163

[Curve Market Cap] – Curve Cross Asset Transactions Arrive

[The Defiant] – ETH Heats Up and Not Just The Price

[MakerDAO Blog] – Nine Most Common Missteps of Crypto and DeFi Users

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