This Week in DeFi – September 17

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To the DeFi community,

This week, Avalanche announced raising $230 million in a private token sale to investors led by Polychain and Three Arrows Capital. The sale was completed in June 2021, and the funds will be used to accelerate the growth of DeFi and enterprise applications on Avalanche through token purchases, grants, and technological support.


The Alpha Finance Launchpad announced support for pSTAKE, designed to increase the capital efficiency of staked crypto assets. Similar to Lido’s ETH and SOL staking programs, pSTAKE will allow users to capture the value from staking underlying tokens, as well as additional incentive rewards for using the pSTAKE platform, and of course the liquidity from received stkTOKENs (e.g. stkALPHA). 


Minterest, a new borrowing and lending protocol, was announced this week after raising $6.5 million in a private sale. Mintrest plans to employ a unique fee-based token buyback and distribution scheme to boost long-term yields and more fairly distribute accrued value. The product is still in early access (and not yet audited), so those interested have an opportunity to get into a new DeFi protocol on the ground floor.


And Arbitrum is breaking fast out of the gates, with TVL rising to more than $2.5 billion in the first weeks after launch. Much of the frenzy is driven by sky high yields on projects like NYAN, which have greatly overshadowed liquidity directed to more established projects like Sushiswap. 


The era of the Ethereum L2 has been around for a few months now, but the launch of Arbitrum and the subsequent crush of liquidity into that solution marks the next phase of speed, cost effectiveness, and available bandwidth for blockchain projects for experimentation and industry growth. Next up, bridges and wrappers will increasingly interconnect these competing options, bringing greater efficiency to the movement of value, but also increasing contagion risk that ought not be ignored.


Of course, experimentation and technical innovation that ultimately moves the industry forward are not without their unique and substantial challenges – just last week, several Ethereum alternatives, both L2 and competitors, experienced outages that go against the foundational ethos of always-on, immutable blockchains. These events are inconvenient, and repeated issues of that sort should give any investor pause. But it’s worth remembering that Ethereum’s early days were no walk in the park either, featuring hacks and failures that were perhaps even more damaging to the then even more nascent industry, and indeed idea, of blockchains beyond Bitcoin.

One happy knock-on effect of more choice for your preferred blockchain flavor? It increasingly takes pressure off those protocols that were doing essentially all of the heavy lifting just a few months ago. EIP-1559 has also, as advertised, made Ethereum gas fees more predictable, if not necessarily more affordable for the average user. With so many choices, where will you park your liquidity? It’s enough to make your head spin – but the rewards are great, so try to stay focused. We’re building the future!


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Interest Rates


Highest Yields: BlockFi at 8.50% APY, Nexo Lend at 8% APY

Cheapest LoansCompound at 4.34% APY, Aave at 5.17% APY

MakerDAO Updates

DAI Savings Rate: 0.00%

Base Fee: 0.00%

ETH Stability Fee: 5.50%

USDC Stability Fee: 0.00%

WBTC Stability Fee: 4.50%


Highest Yields: Celsius at 8.88% APY, Ledn at 8.50% APY

Cheapest LoansCompound at 4.70% APY, Aave at 6.45% APY

Top Stories

Kyber and Avalanche Foundation collaborate to launch KyberDMM with $5.8M in Liquidity Incentives

Trading Rebates are Live on Injective

Router Protocol receives grant from Terra Blockchain

Idle + Chainlink: Price Feeds to Secure New Use Cases for $IDLE


Stat Box

Total Value Locked$90.87B (up 4.95% since last week)

DeFi Market Cap$129.5B (up 4.93%)

DEX Weekly Volume$14.73B (down -29.9%)

DAI Supply6.33B (up 2.1%)

Total DeFi Users3,367,000 (up 2.09%)

Bonus Reads

[Sting – The TIE] – A Deep Dive into SushiSwap

[Fabian Klauder – DeFi Times] – Top Cosmos Projects

[Ben Giove – Bankless] – The best ways to invest in Layer 2

[Anthony Sassano – The Daily Gwei] Time Preferences – The Daily Gwei #336

[Brady Dale – The Defiant] – Solana Outage Likely Caused by Bots Pursuing an Initial DEX Offering


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