🌻Why Compound Might Ditch its Yield Farmers

Hello Defiers! Here’s what we’re covering today: News Why Compound Might Ditch its Yield Farmers Ethereum Mixer Blocks North Korean Hacker Group Behind $600M Axie Infinity Heist Ethereum Foundation, AMD, Polkadot Launch $7M Competition to Boost Zero-Kn...


Hello Defiers! Here’s what we’re covering today:



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$COMP Liquidity Incentives

🌻Why Compound Might Ditch its Yield Farmers

By Samuel Haig

In the summer of 2020, Ethereum lending protocol Compound worked out that if you give away free governance tokens for borrowing and lending crypto, people will flock to your platform and pump the value of your new token.

But when that free money spigot ran dry, those new users disappeared. Almost two years later, the price of Compound’s token has fallen 83% from its all-time high, and the protocol has lost considerable ground to its rivals.

Now the Compound community is using those governance tokens to redesign the incentives that attract people to the platform. One proposal wants to scratch the COMP rewards program entirely – and it’s gaining a lot of traction.

“The practice of COMP farming for profit has become very problematic,” wrote Tyler Loewen, the author of the popular governance proposal to overhaul Compound’s incentives.

“This COMP farming behavior is not the kind of activity that will bring value to the protocol, or for the existing users and token holders. Incentives need to be used to grow the protocol to the benefit of the protocol itself and its users and token holders,” he said.


Tornado Cash Takes Action Against Lazarus

👀 Ethereum Mixer Blocks North Korean Hacker Group Behind $600M Axie Infinity Heist

By Owen Fernau

Tornado Cash has banned Lazarus, the North Korean hacking group the FBI says is behind last month’s $600 million hack on Axie Infinity’s Ronin bridge, from using its Ethereum mixing service.

The state-sponsored hacking group, which the U.S. government also holds responsible for the 2017 WannaCry ransomware campaign, is one of 24 addresses banned by the service, which obscures the provenance of Ethereum transactions..

The mixing service announced on April 15 that it blocks addresses sanctioned by the U.S. Office of Foreign Assets Control (OFAC). Tornado Cash accesses the sanctions list through an oracle created last month by blockchain tracking company Chainalysis.

The sanctions list also includes addresses controlled by a Russian ransomware group, an exchange that the U.S. Treasury says helped ransomware groups launder money, and a number of Russian nationals, The Defiantdetermined after cross-referencing data from Chainlink’s oracle with the OFAC sanction list.


Swap Tokens From Any Web3 Dapp

💸 Ethereum Foundation, AMD, Polkadot Launch $7M Competition to Boost Zero-Knowledge Scaling

By Samuel Haig

Leading crypto projects have banded together to offer $7M in prizes to teams innovating using zero-knowledge (ZK) proofs, a privacy-preserving scaling technology for blockchain transactions.

Announced on April 19, ZPrize is an industry-sponsored contest supported by 21 Web3 organizations including Polygon, Polkadot, Mina, and the Ethereum Foundation. AMD-Xilinx will also provide competing teams with high-powered computing equipment.

ZPrize said in a statement that teams will try to engineer “new algorithms and techniques that achieve performance metrics unmatched by the best zero-knowledge systems.” The winners must open-source their submissions so that other developers can integrate any breakthroughs into their work.

Zero-knowledge proofs allow for blockchain transactions to be executed without publishing any data aside from the time and date they occurred. Only the transaction’s counterparties can access detailed information, including the wallet addresses involved and the assets transferred.


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🔗 Indian crypto exchange CoinDCX tops $2 billion valuation in new $135 million funding: TechCrunch

CoinDCX has doubled its valuation to $2.15 billion (post-money) in eight months following a fresh $135 million funding, it said today, as the Indian cryptocurrency exchange looks to aggressively expand its product offerings and talent base, including some to double down on compliances in the world’s second largest internet market.

The startup, the first Indian crypto firm to attain the unicorn status last year, says it has amassed over 10 million users. In addition to allowing users to buy various tokens for as low as 100 Indian rupees ($1.3), CoinDCX also provides margin trading and the option to stake digital assets.

🔗 Republican lawmakers accuse SEC of restricting crypto exchanges in recent rulemakings: The Block

On April 18, Representatives Patrick McHenry (R-NC) and Bill Huizenga (R-MI) wrote to SEC Chair Gensler criticizing the commission's recent rulemakings as they relate to crypto.

The two proposals in question — one from January and one from March — push for expanded definitions of terms that appear in the 1934 Securities Exchange Act. In general, the rulemakings seem to require crypto exchanges to register with the SEC as exchanges and market makers to register with the SEC as broker-dealers.

🔗 U.S. Government Issues Alert on Malicious North Korean Crypto Activity: Decrypt

TThe FBI, the U.S. Treasury Department, and Cybersecurity and Infrastructure Security Agency (CISA) have co-released a cybersecurity advisory on North Korean state-sponsored efforts targeting the blockchain and cryptocurrency industry.

“The U.S. government has observed North Korean cyber actors targeting a variety of organizations in the blockchain technology and cryptocurrency industry,” the report reads.

🔗 Hackers steal $655K after picking MetaMask seed from iCloud backup: Bleeping Computer

MetaMask has published a warning for their iOS users about the seeds of cryptocurrency wallets being stored in Apple's iCloud if app data backup is active.

MetaMask is a “hot” cryptocurrency wallet used by over 21 million investors to store their wallet tokens and manage their digital assets.

🔗 Terra’s LUNA Surges 17% as UST Becomes Third Largest Stablecoin: CoinDesk

LUNA pushed past the $80-$82 mark, a pivot support level, to as much as $92.07 during early Asian hours. Profit-taking saw prices fall to $89 at writing time, another support level for the token.

The spike comes as Terra's algorithmic stablecoin UST toppled Binance USD (BUSD) to become the third-largest stablecoin by circulation, during the later hours of Monday.

Trending in The Defiant

  • Uniswap Launches Swap Widget For Third-Party Apps Uniswap is now accessible from anywhere across web3. On April 14, Uniswap launched Swap Widget, allowing developers to integrate access to the exchange “with just one line of code.” Swap Widget leverages Uniswap’s Auto Router to source the best pricing across the exchange’s v2 and v3 pools. It is also available on Uniswap’s Layer 2 deployments, allowing developers building on Optimism, Arbitrum, and Polygon to integrate the widget to facilitate low-fee swaps.
  • Meta’s Plan to Keep 47.5% of Metaverse Sales Draws SkepticismThe company formerly known as Facebook continues to make moves toward its version of the metaverse. And the crypto community remains skeptical. A Reuters article reported that the recently renamed Meta will be taking a 47.5% cut from sales of digital assets. This is through a combination of a 30% fee on the Meta Quest Store, where users buy games and apps for the Oculus Quest headset, and a 17.5% fee from Horizon Worlds, Meta’s metaverse platform.
  • Uniswap Faces Class Action Lawsuit From Trader Who Lost Money On AltcoinsTwo U.S. law firms have invited anyone who lost money on Uniswap since last April to join a class action suit against the exchange’s developers and investors for failing to crack down on “rampant fraud”.On April 4, Nessa Risley of North Carolina filed a lawsuit alleging that the decentralized exchange’s lack of identity checks and securities restrictions lets fraudsters list “thousands of scam tokens” associated with rug pulls, pump and dumps, and Ponzi schemes on the platform.

🧑‍💻 ✍️ Stories in The Defiant are written by Owen Fernau, Samuel Haig, DeFiDad, and yyctrader, and edited by Edward Robinson, yyctrader, and Camila Russo. Videos are produced by Robin Schmidt, Alp Gasimov and Daniel Flynn. Podcast is led by Camila, edited by Alp.

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The Defiant is a daily newsletter focusing on decentralized finance, a new financial system that’s being built on top of open blockchains. The space is evolving at breakneck speed and revolutionizing tech and money. Signest, most interesting developments. Subscribers get full access, while free signups get only part of the content. Click here to pay with DAI (for $100/yr) or sub with fiat by clicking on the button above ($15/mo, $150/yr)