DeFi Daily

Crypto Markets Surge As Investors Predict Fed Pause

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Fed Policy

Crypto Markets Surge As Investors Predict Fed Pause

Bitcoin and Ether Approach $26K, $1,800

By Aleksandar Gilbert


A rally that began over the weekend was given a boost Tuesday morning, with the release of US inflation data that hardened investor expectations of a quarter-percent interest rate hike at the Fed’s March 22 meeting.

As of noon Tuesday, the global market capitalization of digital assets has jumped more than 23% from a Friday low, according to data from CoinMarketCap.

The two largest cryptocurrencies, Bitcoin and Ether, jumped almost 30% and 25% over that same period, far outpacing the broader equities markets.

Investors are now betting Federal Reserve Chairman Jerome Powell will temper interest rate hikes to avoid further destabilizing the banking system.

Read the full story in The Defiant


USDC Finds Stability Near $0.97 After Crashing on SVB Concerns

Circle said the stablecoin will be redeemable for US dollars starting Monday.

By Samuel Haig


USDC is edging closer to its peg after its issuer, Circle, said it would stand by the stablecoin. Traders are still flocking to alternatives as concerns persist that Silicon Vallet Bank’s failure will impact the token.

USDC, the second-largest stablecoin, traded within a one-cent range near $0.97 over the past six hours after crashing to as low as $0.88.

Many users rushed to trade their depegged stablecoins for Tether’s USDT, the largest centralized stablecoin, and Liquity’s LUSD, a decentralized and overcollateralized stablecoin exclusively backed by Ether.

Read the full story in The Defiant

DeFi Rally

Markets Recover After U.S. Regulators Backstop Deposits At Failed Banks

DeFi Heavyweights Maker, Synthetix and Lido Lead Sector Higher

By Samuel Haig

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The crypto markets are rebounding after Circle, the company behind the USDC stablecoin, assured investors that its reserves held with the failed Silicon Valley Bank are safe.

DeFi assets surged, with Synthetix (SNX) up 33%, Maker (MKR) rallying 30%, Lido (LDO) bouncing 22%, and Frax (FXS) recovering 16% over the past day.

The combined market cap of DeFi projects is up 10% today after slumping 17.5% between March 2 and March 12.

Markets caught a further tailwind after Binance, the top centralized exchange, announced it will mobilize the remaining $980M from its $1B Industry Recovery Initiative that it set up in November to purchase Bitcoin (BTC), ETH, and Binance Coin (BNB).

Read the full story in The Defiant


DeFi Exploit

DeFi Lender Euler Suffers $200M Exploit

Code Bug Enabled Flash Loan Attack

By Tarang Khaitan


Euler, a lending protocol that held over $400M of user assets as of yesterday, has been exploited for nearly $200M in what may be the biggest DeFi exploit of 2023.

The attacker managed to steal nearly $136M of Lido Finance’s stETH, $34M of USDC, $18.5M of WBTC and $8.8M in DAI.

The protocol’s EUL governance token lost over half its value in the wake of the attack.

Euler is widely integrated with the broader DeFi ecosystem due to a combination of being well-regarded and offering liquidity incentives, and the exploit has affected many protocols that either deposited funds in Euler or had indirect exposure.

Read the full story in The Defiant

US Banks

Silvergate, Signature Collapse Leaves Crypto with Few Bank Partners

Foreign Companies Could Fill the Void

By Aleksandar Gilbert


Crypto’s go-to banks collapsed last week, and it left U.S.-based players in the embattled industry with few remaining links to the traditional financial system.

It’s the latest blow to an industry under siege in the United States, where bank regulators have issued repeated warnings regarding crypto’s risk profile. There are few remaining banks willing to work with crypto companies, according to experts, and there are significant obstacles to those willing to fill the void left by Silvergate.

At stake is the ability for companies in the crypto industry to accept and make payments in U.S. dollars, and convert crypto to fiat and vice versa, drastically limiting their business in the U.S.

Read the full story in The Defiant

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