This Week in DeFi - April 8

This week, UST and FRAX take on DAI on Curve, a new token standard is created on Ethereum and NEAR Protocol raises $350M.

Apr 8

To the DeFi community,

This week Terra founder Do Kwon has declared war against prominent Dai stablecoin (DAI), via the launch of “4pool” – a stablecoin liquidity pool on Curve with an emphasis on UST and FRAX. The pool is attempting to attract liquidity from “3pool”, a similar pool containing DAI, by using large quantities of CVX to drive incentives.

Do Kwon 🌕 @stablekwon

1/ Introducing the 4pool - between @fraxfinance, TFL and @redactedcartel we pretty much own all the cvx UST-FRAX-USDC-USDT Curve wars are over, all emissions are going to the 4pool

zon @ItsAlwaysZonny

introducing the 4pool: @terra_money 🤝 @fraxfinance & a kickass partnership with the flappers: @terra_money 🤝 @redactedcartel https://t.co/CgDDvRUwGp

Grayscale has shaken up its DeFi fund with the first quarterly rebalance of 2022, removing Synthetix (SNX) and Sushi (SUSHI) from its basket of assets. Both tokens failed to meet the minimum market cap threshold to remain in the fund. Taking their place are Avalanche (AVAX) and Polkadot (DOT).

Grayscale @Grayscale

NEW: As part of our quarterly rebalancing, $DOT and $AVAX have been added to Grayscale Digital Large Cap Fund, and $ATOM has been added to Grayscale Smart Contract Platform ex-Ethereum Fund. $GDLC #GSCPXE @Blockworks_ has the exclusive with details:

Grayscale Adjusts Cryptoassets Exposure in Diversified FundsGrayscale Investments is adding three cryptoassets across its three diversified funds and removing two others from the products.gryscl.co

A new Ethereum-based token standard is on the horizon, with proclaimed support from multiple high-profile protocols. The ERC-4626 token standard is designed for interest-bearing yield tokens, intended to be more secure and solve composability issues.

scoopy trooples @scupytrooples

Omg I want this now so bad. Single biggest pain point for Alchemix v2 is the fact that every different yield token integration has a bespoke solution requiring audit. If they were standardized, it'd be one and done. @iearnfinance @AaveAave and @compoundfinance should all help too

Joey 💚’s ERC-4626 @joey__santoro

ERC4626 is a landmark interface for yield bearing vaults that will supercharge DeFi innovation ⚡️ On this rock we will build our empire 🏰 TLDR; adopt ERC4626 or ngmi Here is what this interface means for the Tribe, and for DeFi generally 🧵

NEAR Protocol has raised a massive $350 million in funding from Tiger Global, FTX Ventures and others. The protocol has plans to blaze its own trail as a decentralized application (DApp) platform, already bridging to the Ethereum main chain.

Wong Joon Ian @joonian

wow $500m this year

Ethereum Rival NEAR Protocol Raises $350 Million in New Funding - DecryptThis new raise by NEAR Protocol was led by Tiger Global, with participation from FTX Ventures, Dragonfly Capital, and others.decrypt.co

Stablecoins have become a very hot topic over the recent weeks, both directly in DeFi and broader cryptocurrency headlines. As we all know, stablecoins play an integral part across most DeFi protocols and will continue to do so for a long time – especially until major decentralized currencies reach a saturation point for adoption.

Governments and regulators are slowly closing in with their own influences, as highlighted by Treasury Secretary Janet Yellen in yesterday’s speech; the US government is more closely inspecting stablecoins, along with the risks they may pose to the traditional financial system. This influence will likely most strongly impact centralized stablecoins, which may eventually find themselves in direct competition with central bank digital currencies (CBDCs). As a result, this is placing increasing importance on decentralized alternatives. Newer examples such as Frax and TerraUSD have climbed the ranks quickly as of late, giving the well-established Dai a run for its money.

In other news, stablecoin use has even crept as far as Bitcoin’s Lightning Network, as the “Taro” protocol receives tens of millions in fresh funding.

There’s a lot to be watching in the stablecoin space, with massive implications for the wider DeFi space – time will tell us how it all plays out.

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