LD Track Weekly Report [25/09/2023]
[Summary]
Lending: The Aave community has passed a proposal for a liquidity strategy upgrade concerning the stablecoin GHO. Maker’s RWA asset size continues to grow.
LSD: Last week, the ETH staking rate increased to 22.51%, a week-on-week growth of 0.7%. 27.06 million ETH were staked on the Beacon Chain, representing a staking rate of 22.51%, an increase of 0.7% from the previous week. Active validator nodes stood at 819,600, a growth of 1.94%, while 22,200 were in the queue, marking a 28.43% decline. This week, the ETH staking yield decreased to 3.55%, and the annual inflation rate increased to 0.285%.
Ethereum L2: Layer2 TVL has risen to $10.28 billion. Due to Holesky testnet’s failed launch last week, core Ethereum developers are concerned about a potential delay in the Cancun upgrade rollout this year. OP announced a private token sale of approximately 116 million OP tokens with a two-year lock-up. This week, OP will see a regular unlock of 24.16 million tokens.
DEX: Dex combined TVL is at $11.45 billion, a decrease of $0.27 million from last week.
Dex’s 24-hour trading volume is $970 million and a 7-day trading volume of $9.72 billion, down by $2.5 billion from last week. The market was influenced by FOMC’s hawkish stance, leading to a weak rebound and a decline in trading volume.
Derivative DEX:
In the past two weeks, the main Derivative DEX trading volumes were $6.9 billion and $6.5 billion, respectively, maintaining a generally low level. DYDX dominated the trading volume, particularly last week, accounting for over 60% of it.
[Lending]
Aave
1) The Aave community voted in favor of the “GHO Liquidity Strategy Upgrade” ARFC proposal, which will proceed to the on-chain voting phase. The proposal aims to stabilize the anchor price of the GHO token and promote diversified liquidity across various DEXs to counter challenges when GHO falls below $0.96.
Additionally, the strategy includes a reward budget to incentivize liquidity provision and stabilize the GHO token anchor price. These rewards will be added gradually based on platform needs and can be updated under specific conditions. TokenLogic will oversee the liquidity analysis and monitoring, and the Liquidity Committee will represent Aave DAO in executing on-chain transactions.
2) Curve’s founder, Michael Egorov, deposited 23.26 million CRV into the lending platform Silo and borrowed 3.75 million crvUSD. This action led the CRV TVL on Silo Llama to reach a historical high of $60 million. Egorov then exchanged these crvUSD for USDT to repay the debt on Aave.
MakerDAO
MakerDAO once again added $50 million of RWA assets through BlockTower Andromeda, mainly investing in short-term U.S. government bonds, with an annual interest rate of 4.5%. The current total scale of RWA assets has reached $2.96 billion.
[LSD]
Last week, the ETH pledge rate rose to 22.51%, up 0.7% from the previous week. 27.06 million ETH were locked in the beacon chain, corresponding to a pledge rate of 22.51%, an increase of 0.7%. Among them, the active verification nodes were 819,600, up 1.94%, and 22,200 were queued for verification, down 28.43%. This week’s ETH pledge yield dropped to 3.55%, and the annual inflation rate rose to 0.285%.
The pledge rate of ETH increased by 0.7% this week.
Ethereum (ETH) Staking Yield This Week: 3.80%
The annual inflation rate for ETH is 0.285%.
Of the three major LSD protocols, in terms of price performance, LDO fell 3.6% over the week, RPL fell 5.9%, and FXS rose 4.4%. From the perspective of ETH pledge volume, Lido increased by 0.88%, Rocket Pool increased by 0.72%, and Frax increased by 0.47%. The current deposit balance of Rocket Pool is 18,057 ETH, with an RPL pledge rate of 49.23% and an effective pledge ratio of 90.56%. SSV saw a significant correction this week, falling 7%. The current TVL is 10,432 ETH, which is an increase of about 3,000 ETH from the 7,500 ETH before entering the third phase of the mainnet launch. The growth rate is not eye-catching. The Frax V3 audit is completed, and the white paper will be released soon. The first national debt purchase is expected to be completed in early October.
[Ethereum L2]
TVL
The total TVL of Layer2 rose to $102.8 billion.
Cancun Upgrade
The 118th Ethereum core developer consensus meeting (ACDC) was held on September 21st. This meeting mainly discussed the preparation work for Devnet-9 and changes to the Ethereum consensus layer (CL).
1. Parithosh Jayanthi, the DevOps engineer of the Ethereum Foundation, stated that their team will launch Devnet-9 on September 27th. EL and CL client teams such as Lodestar, EthereumJS, Lighthouse, and Geth have confirmed they are ready for this testnet release. (Devnet-9 is the second testnet, including a full set of code changes in the Dencun upgrade. Devnet-9 will be the first testnet to activate EIP-7514 and EIP-7516, and these two new EIPs were added to the Dencun upgrade in a meeting last week.)
2. Previously, Tim Beiko suggested launching Dencun on the Holesky, Goerli, and Sepolia testnets in that order. However, as Holesky failed to launch on September 15th, it will be relaunched on September 28th. Ethereum core developer Tim Beiko questioned the Dencun test timeline, stating that if developers cannot ensure Dencun is released on the public testnet before the Ethereum developer’s big Devconnect in November 2023, then the mainnet activation of Dencun is likely not to happen this year.
Jayanthi proposed launching Dencun on Goerli first, then Holesky. Since Goerli is a soon-to-be-abandoned testnet, this means developers can freely try to modify the Dencun specifications. Tim Beiko and Del Fante agreed to test Dencun on Goerli before Holesky, and several developers also supported releasing Dencun on a public testnet before Devconnect.
3. Additionally, developers also discussed the deployment strategy for EIP-4788, and deploying a trusted setup for EIP-4844 on Devnet-9.
OP
1. On September 21st last week, Optimism announced that they had conducted a private token sale of approximately 116 million OP tokens. These tokens were allocated to seven purchasers for financial management purposes. These tokens come with a two-year lock-up period. During the lock-up period (with community feedback suggesting they will unlock immediately after two years), purchasers will be able to delegate their tokens to unrelated third parties for governance. These tokens come from the undistributed portion of the OP token pool and were part of the foundation’s original working budget, representing 30% of the initial OP token supply. This announcement is intended to inform the community in advance, and these are all planned transactions.
2. This Saturday, September 30th at 12:00 PM, Optimism will unlock 24.16 million OP tokens (worth approximately 30.92 million USD), representing 3.03% of the circulating supply.
ARB
1. The short-term incentive plan proposed on September 11th was voted on and completed last week on September 18th. The plan is to distribute 50 million ARB tokens by January 31st, 2024, to incentivize the use of existing Arbitrum dApps. Beneficiaries will be determined based on criteria such as the time of joining Arbitrum, TVL, and transaction volume.
2. The Arbitrum Odyssey will relaunch this week. This Odyssey will collaborate with the Web3 community activity platform, Galxe, for a period of seven weeks. By completing tasks and exploring 13 projects on Arbitrum One, participants can earn customized badges (no airdrops this time). The new Arbitrum Odyssey will include the following 13 projects: GMX, Aboard, tofuNFT, Uniswap, ApeX Protocol, 1inch Network, Premia Blue, DODO, Swapr, Treasure, BattleFly DAO, handle.fi, SushiSwap.
BASE
1. On September 20th, Base announced the open-source monitoring system, Pessimism, aimed at supporting the security of all OP Stack and EVM-compatible chains. Since Base’s launch, the Coinbase team has been running Pessimism internally to monitor the Base mainnet. Pessimism can detect threats specific to the OP stack protocols (withdrawal execution, fault detection) as well as general EVM blockchain events (balance execution, event emission) — with a modular architecture.
2. At the annual summit of Mainnet 2023 hosted by Messari on September 22nd, Coinbase’s Chief Legal Officer, Paul Grewal, responded to the question “Will Base have a token?” by saying, “We haven’t completely ruled out the possibility. I think a token might be viable at some point in the future. However, right now we aren’t focusing much on protocol economics and tokenization. Regulatory clarity is also very important.”
On-chain Activity
[Dex]
Dex combined TVL is 11.45 billion, a decrease of 0.27 million from last week. Dex’s 24-hour trading volume is 970 million, with a 7-day trading volume of 9.72 billion, down 2.5 billion from last week. The market this week has been affected by FOMC’s hawkish stance, causing a weaker rebound momentum and a decrease in trading volume.
Ethereum
ETH L2/sidechain Ecosystem
BTC L2/Sidechain
Alt L1
[Derivative DEX]
Over the past two weeks, the trading volumes of major derivative DEXs were $6.9 billion and $6.5 billion respectively, with trading volumes still generally at a low level. DYDX accounted for most of the trading volume, especially in the most recent week, where its volume share exceeded 60%.
In terms of TVL (Total Value Locked), the overall TVL for derivative DEXs appears to be in a net outflow state, with no signs of incoming funds.
Regarding users, the daily active user count for derivative DEXs overall remains low. The number of daily active users for the main protocols has not seen significant changes. Over these two weeks, the main surge has been in the daily active users of the perpetual protocol, which has increased to over 1,000.
LD Capital
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