Weekly DeFi Index

This week's price, volume, and volatility indices were negative at -11.84%, -11.68%, and -25.42%, respectively.

Check the latest prices on Crypto.com/Price

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DeFi Index Tokens

*DeFI index tokens: AAVE, BAL, CAKE, COMP, CRV, CVX, FXS, JOE, LDO, LINK, MKR, OSMO, REN, SNX, SPELL, SUSHI, UNI, VVS, YFI.

News Highlight 

• Compound, a borrowing and lending protocol on Ethereum, launched a new version called Compound III. It’s a streamlined version of the protocol with an emphasis on security, capital efficiency, and user experience. The biggest change is that the collateral remains the borrowers’ property and nobody else can borrow or withdraw it. Additionally, borrowers won't earn interest on their collateral, which could enable them to borrow more with less risk of liquidation.

• Ethereum layer-2 scaling solution Arbitrum is set for a major upgrade on 31 August. Referred to as the ‘Nitro’ upgrade, it alleges to increase transaction throughput, slash transaction fees, and simplify cross-chain communication between Arbitrum and Ethereum. 

• Decentralised exchange Uniswap engaged in talks with multiple NFT lending protocols to build NFT financialisation. According to a social post from Uniswap's head of NFT product, the company is interested in solving both liquidity issues and the “information asymmetry” surrounding NFTs.

DEX Protocols Metrics

Sources: CoinGecko, DeFi Llama, Nomics, Crypto.com Research

Lending Protocols Metrics

*LDR (Loan to Deposit Ratio) = Total Borrowed / TVL

Sources: CoinGecko, DeFi Llama, Crypto.com Research

Charts on Layer 2 Projects

• Overall, the L2 market continued the downtrend, dropping by -8.41% in the last week and the TVL of all L2 categories fell. Optimistic rollup projects dropped by -7.61% and zero-knowledge rollup projects decreased by -3.50%. Ethereum’s TVL fell by -4.69%.

• The TVL for all major optimistic rollup projects were negative last week, and Boba Network plunged the most at -16.50%.

• Similarly, almost all ZK rollup projects’ TVL declined except dYdX, of which its TVL kept stable and grew +0.21%. Loopring plummeted the most at -10.27%.

Further Reading 

• Uniswap Foundation becomes reality after 86M votes in favour

• Aave community proposes to temporarily suspend ETH lending before the Merge

• MakerDAO co-founder recommends DAI-USD depegging to limit attack surface

• Blockchain gaming platform Myria launches layer 2 scaling solution on Ethereum

• Antpool reveals plans to drop Ethereum Ethash support, plans to keep mining ETC

• FBI issues alert over cybercriminal exploits targeting DeFi

Thank you for reading! We hope you find our Weekly Defi and Layer 1 & Layer 2 News Update enlightening!

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