Weekly DeFi Index

This week's market cap, volume, and volatility indices were positive at+0.37,+0.86, and+75.98, respectively.

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Chart of the Week

DOGE saw a significant surge in network activity, as its daily transactions increased from an average of 20,000 in early May to hitting the 2 million mark in the past week. Compared to other networks, Dogecoin processed more transactions than Ethereum (~1.9 million) and Bitcoin (less than 1 million) between 27 and 28 May. This increase also coincided with a jump in hashrate, up 38% in May, suggesting an increasing number of miners on the network. 

News Highlights

• Ethereum recently surpassed a major milestone in deposit contract balance since the completion of the Shapella upgrade, exceeding US$40 billion. Since 12 April, users have deposited over 4.4 million ETH. 

• Stablecoin issuer Tether announced its plans to invest in an energy production and sustainable Bitcoin mining facility in Uruguay. This comes after Tether laid out its plans earlier this month to regularly allocate a portion of its profits to Bitcoin investments. 

• The Ordinals Market and the Bitcoin Miladys NFT collection jointly launched BRC-721E, a new token standard that enables NFT migration from the Ethereum network to the Bitcoin network. This is done by burning ERC-721 NFTs and transferring them to inscriptions on the Bitcoin network. The bridged NFT will then appear on a custom Ordinals Market collection page with complete metadata once inscribed.  

• Optimism and Sui are scheduled for token unlocks this week. Layer-2 blockchain Optimism is set to release 387 million tokens on 31 May, which represents 9% of its total token supply and will increase its current circulating supply by 114%. Layer-1 blockchain Sui will unlock 61 million tokens on 3 June, increasing its circulating supply by 13%. Meanwhile, decentralised exchange 1inch is also set to unlock nearly 250 million 1INCH tokens on 2 June, releasing over 16% of its token supply into circulation. 

• Stablecoin issuer Circle launched Euro Coin (EUROC) on the Avalanche network on 25 May, with the aim to further increase its liquidity. Launched in 2022, EUROC is a Euro-based regulated stablecoin held in custody at US-regulated financial institutions. 

• Kain Warwick, founder of decentralised derivatives trading platform Synthetix, shared 12 governance proposals in a blog post. Proposals involve a 3:1 split of SNX tokens, a buyback-and-burn scheme, and a ‘core contributor alignment’ in the form of quarterly SNX token bonuses awarded to project contributors. 

• Arbitrum-based DeFi app Jimbos Protocol was attacked days after its Version 2 went live. It lost 4,090 ETH (worth around $7.5 million at the time) through a flash loan attack and is currently working with authorities to reclaim lost funds. 

• DeFi protocol WDZD Swap experienced an exploit on 19 May. According to blockchain security firm Certik, about $1.1 million worth of Binanced-pegged Ether was drained through a contract associated with the WDZD project.

Recent Research Reports

• Monthly Research Roundup (April 2023): In this issue, we feature trending market insights, and our latest research reports take a closer look into Bitcoin’s expanding ecosystem, specifically Layer 2s, DeFi, and NFTs.

• Alpha Navigator: Quest for Alpha [April 2023]: Asset classes were generally flat in April, with cryptocurrency outperforming other assets. The US Federal Reserve could be on the cusp of ending its interest rate hike cycle.

• Bitcoin’s Expanding Ecosystem: Layer-2, DeFi, NFT: The landscape of the latest projects building on top of Bitcoin is expanding beyond payments. It now includes Layer-2 scaling solutions and key application categories like DeFi and NFTs.

Recent University Articles

• A Short History of Bitcoin Price: The price of BTC has experienced peaks and valleys ever since it launched in 2009. Learn all about Bitcoin's price history.

• What Are ERC-20 Tokens? All About Ethereum’s Most Important Token Standard: ERC-20 is a token standard for fungible tokens on Ethereum. Learn what it is and how cryptocurrencies can be minted with it.

• How to Buy Bitcoin and Other Cryptocurrencies: Wondering how to buy your first Bitcoin? Or cryptocurrency in general? Here's a step-by-step guide on crypto buying for beginners.

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