🚀 Uniswap Votes to Launch V3 on zkSync
Hello Defiers! Here’s what we’re covering today: News Uniswap Votes to Launch V3 on zkSync Tether Drops Commercial Paper From USDT Reserves Uniswap Fulfills its Unicorn Destiny with $165M Funding Round NFT Roundup Anthony Hopkins’ Metaverse Debut Sells Out in Seven Minutes
Hello Defiers! Here’s what we’re covering today:
News
- Uniswap Votes to Launch V3 on zkSync
- Tether Drops Commercial Paper From USDT Reserves
- Uniswap Fulfills its Unicorn Destiny with $165M Funding Round
NFT Roundup
👀 Defiant Premium Story for Paid Subscribers (📜Scroll to the end!)
Podcast
🎙️Friends with Benefits’ Alex Zhang on Building Web3 Communities That Endure
Video
DeFi Explainers
Elsewhere
- NFT games are ‘only scratching the surface’ of what’s possible — Animoca’s Yat Siu: CoinTelegraph
- Binance launches $500 million fund to provide loans to Bitcoin miners: The Block
- When I created Uniswap in 2018, it was an experiment to create an application that fully embodied the values of Ethereum: Hayden Adams
Trending in The Defiant
- SushiSwap’s Grey Rebuts Accusations Made ‘Without Any Substantial Evidence’
- Curve DAO Votes To Enable Permissionless Rewards
- Why MEV Matters and Other Post-Merge Revelations
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Uniswap + Layer 2s
🚀 Uniswap Votes to Launch V3 on zkSync
Leading DEX to Deploy on Layer 2 After Raising $165M in Funding Round
By Samuel Haig
PROPOSAL Acting on a governance proposal by students from the University of Pennsylvania, Uniswap v3, the top decentralized exchange by trade volume, will deploy on the zkSync Layer 2 network following a vote on Oct. 14.
👉READ THE FULL STORY IN THE DEFIANT.IO👈
Stablecoins
💵 Tether Drops Commercial Paper From USDT Reserves
Majority Of Reserves Allocated To U.S. Treasury Bills
By yyctrader
NEWS Tether, the company behind USDT, crypto’s largest stablecoin with a market capitalization of $69B, has completely eliminated commercial paper from its reserves.
👉READ THE FULL STORY IN THE DEFIANT.IO👈
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DeFi Fundraising
🦄 Uniswap Fulfills its Unicorn Destiny with $165M Funding Round
Leading DeFi Player Joins Elite Club of $1B+ Ventures as Members Deploy DEX on Another Network
The DeFi company famed for its unicorn logo has finally become a real life unicorn. On Thursday, Uniswap Labs, the company behind the leading DEX Uniswap, raised a whopping $165M in a Series B fundraising round, according to an announcement.
👉READ THE FULL STORY IN THE DEFIANT.IO👈
NFT Roundup
🎭 Anthony Hopkins’ Metaverse Debut Sells Out in Seven Minutes
OpenSea Adds Avalanche Support in Heady Week for NFTs
By yyctrader
FIRST FORAY Oscar-winning actor Anthony Hopkins made his first foray into NFTs on Thursday, and collectors snapped up the 1,000 NFTs on sale within a matter of minutes.
👉READ THE FULL STORY IN THE DEFIANT.IO👈
Defiant Video
📺 Quick Take: 4 DeFi Projects Get Hacked in 1 Day
Defiant Podcast Video
📺 Friends with Benefits – the community that uses crypto, not a crypto community
Shoutout
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DeFi Explainers
🤔 What Is TVL?
A Step-by-Step Guide to a Key Metric in DeFi
LOGIC Total value locked (TVL) is one of the key indicators to help us understand the value of a smart contract protocol. Smart contracts recreate traditional finance by codifying contractual logic and automating it.
👉READ THE FULL STORY IN THE DEFIANT.IO👈
Elsewhere
🔗 NFT games are ‘only scratching the surface’ of what’s possible — Animoca’s Yat Siu: CoinTelegraph
Animoca Brands co-founder Yat Siu believes nonfungible token (NFT) games are only scratching the surface of what’s possible and predicts completely new models of gaming will be developed as a result of digital ownership.
🔗 Binance launches $500 million fund to provide loans to Bitcoin miners: The Block
Binance has launched a $500 million fund to provide loans to Bitcoin miners struggling to cope with difficult crypto-market conditions.
1/ When I created Uniswap in 2018, it was an experiment to create an application that fully embodied the values of Ethereum.
Over these 4 years, it’s grown more than I could have imagined. Today I'm so excited to announce that Labs has raised $165M in Series B funding 🦄 https://t.co/jMPvBBiG8L
— hayden.eth 🦄 (@haydenzadams) October 13, 2022
Trending in The Defiant
- SushiSwap’s Grey Rebuts Accusations Made ‘Without Any Substantial Evidence’ Jared Grey has said his piece. And yes, he addressed the horse. In a detailed response published on Thursday, SushiSwap’s new head chef rejected the extraordinary allegations leveled against him this week and defended his record and reputation.
- Curve DAO Votes To Enable Permissionless RewardsCurve Finance, a decentralized exchange (DEX) that is DeFi’s third-largest protocol with $6B locked in its smart contracts, has concluded a governance vote to allow any project to add token rewards to its factory-deployed gauges.
- Why MEV Matters and Other Post-Merge RevelationsThe Merge was undoubtedly the most significant Web3 network upgrade to date, with implications that go beyond switching consensus mechanisms and reducing energy consumption. In fact, this upgrade was the first step towards a future in which your Ethereum wallet pays you to use it.
🧑💻 ✍️ Stories in The Defiant are written by Owen Fernau, Aleksandar Gilbert, Samuel Haig, and yyctrader, and edited by Edward Robinson, yyctrader and Camila Russo. Videos were produced by Alp Gasimov. Podcast was led by Camila, edited by Alp.
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👀 Defiant Premium Story for Paid Subscribers
📉 Arrakis Loses Mojo as User Pulls $300M From Vault Provider
Automated Liquidity Protocol Struggles with ‘Incredibly Complicated’ Model
By Samuel Haig
Arrakis Finance, an automated liquidity management protocol, is sliding down the DeFi rankings.
On Oct. 13, 0xngmi, a prominent crypto influencer and contributor to web3 analytics website, DeFi Llama, flagged that a user removed around $300M from Arrakis Finance’s DAI/USDC vault. The withdrawal reduced the pool’s TVL by more than 40% from $800M.
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Arrakis, which is apparently named after the desert planet in Frank Herbert’s sci-fi classic Dune, provides automated vaults designed to bolster profits and minimize risks for Uniswap v3 providers.
The vaults automatically rebalance and compound liquidity positions, offering a hands-off alternative to what is otherwise an intensive trading strategy.
Challenging Months
The $300M withdrawal compounds a challenging couple of months for Arrakis Finance, which leverages the Uniswap v3 decentralized exchange.
The project’s TVL has lost half its value since August and is now worth $856.5M, according to DeFi Llama.
Before its recent troubles, Arrakis was one of the few DeFi protocols to grow during the bear market.
The project launched in mid-2021 and quickly built up momentum. It started 2022 with more than $131M in its smart contracts and grew 13-fold over the next eight months.
Concentrated Liquidity
Yet Arrakis’s growth hinges on increasing capital being deployed to provide liquidity to Uniswap v3. And the complexity of the model is becoming an issue.
Uniswap v3 pioneered concentrated liquidity within the decentralized exchange sector. Uniswap v3 allows liquidity providers to select specific price ranges within which their assets are deployed to settle trades and collect fees.
Prior to v3, all assets provided to DEXs by liquidity providers were always used to settle trades regardless of price, resulting in inefficient capital provision and increased risks of divergent loss.
However, recent research from the Swiss Federal Institute of Technology found that providing liquidity on Uniswap v3 is “incredibly complicated,” warning that “retail traders do not stand a chance” at competing with sophisticated and institutional entities.
High Returns
“Obtaining high returns as a liquidity provider on Uniswap V3 is a highly complicated undertaking requiring active management and a good know-how,” the institute said. “The introduction of Uniswap V3 has thus turned liquidity providing into a playing field for sophisticated investors where retail traders must be wary to avoid risking significant losses. Retail traders… should therefore restrict themselves to simple strategies that yield only small returns.”
The complexity associated with manually providing liquidity to Uniswap v3 paved the way for protocols offering automated liquidity management.
Despite its struggles, Arrakis continues to dominate its corner of DeFi.
A competitor, Visor Finance, launched in mid-2021 and peaked with a nearly $25M TVL in December. However, it failed to recapture market share after being rocked by an exploit that drained $8.2M from the protocol on Dec. 21. Visor now holds just $3.1M in locked assets, according to Stelareum.
Charm Finance similarly enjoyed a strong growth trajectory after launching automated liquidity management vaults shortly after Uniswap v3’s launch. It peaked with a TVL of $13M in November 2021, but suffered amid the 2022 bear trend. Its TVL is now just $2.1M, according to DeFi Llama.
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