To the DeFi Community,

The launch of Eth2 staking is a monumental moment for crypto.

Years of hard work are finally coming into fruition. The entire 2017 bull run was predicated on “Eth2 is around the corner”, three years later and that statement finally holds true. Anyone in the world can participate in the initial bond offering for the decentralized economy. All you need is 32 ETH. And while this is a significant barrier to entry for now, staking pools and other alternatives, like Rocket Pool, will democratize access to the perpetual bond of the future. Don’t get us wrong either – staking in ETH2 right now is risky. This is the frontier of the internet economy. But those that decide to take the risk will be rewarded handsomely. At the current parameters, those who lock up ETH in the deposit contract will be entitled to a 21% APY on their ETH – a respectable yield even in the lens of yield farming.

Eth2 launches December 1st 2020.

ETH staking will begin.

This is the initial bond offering for the largest non-sovereign global economy the world has ever seen.

No longer a commodity.

No longer a money.

ETH becomes a capital asset too.

ETH is a triple-point asset.

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— Ryan Sean Adams – rsa.eth ?? (@RyanSAdams) November 4, 2020

The biggest whales, like Vitalik and others, are beginning to lock up their ETH in order to participate and secure the network. And the market is starting to respond. While the BTC halving earlier this year acts as a tailwind for the broader crypto market, the launch of the Eth2 deposit contract acts as another token sink for ETH. Once deposited, that ether is locked away for years, continuously siphoning away a portion of the supply that can ever circulate secondary markets. All while DeFi continues to disrupt traditional finance on the Eth1.x chain and bring financial services to anyone in the world with an internet connection.

While ETH and BTC begin to climb, DeFi tokens across the board are rebounding. People are back to aping into the hottest yield farms and DeFi tokens. It feels like DeFi is back, but with a renewed respect for what we’re building. The amount of scams and rug pulls have dropped dramatically while new projects (with audits) are beginning to launch of mainnet, offering new building blocks for the world of open finance.

A few weeks ago, we wrote about how there’s blood in the streets and the peace and quiet in DeFi won’t last for long.

That’s starting to hold true. So hold on tight – 2021 is going to be an exciting year.

-Lucas

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Interest Rates

DAI

• Highest Yields: Bitfinex at 65% APY (not recommended), dYdX at 8.0% APY
• Cheapest Loan: Maker at 2.00% w/ ETH collateral or Compound at 4.0% (earn 2.83% in COMP rebates!) 
• MakerDAO Updates
  • Dai Savings Rate: 0.00%
  • Base Fee: 0.00%
  • ETH Stability Fee: 2.00%
  • USDC Stability Fee: 4.00%
  • WBTC Stability Fee: 4.00%
  • Updates: Executive vote to onboard YFI and BAL as collateral, adjust debt ceilings, and stability fees

USDC

• Highest Yield: BlockFi at 8.60% (centralized) Fulcrum at 11.4%
• Cheapest Loan: Nuo at 2.3% or Compound at 4.5% (earn 2.31% APY in COMP rebates)

Find more lending & borrowing rates on our Rates page! 

Eth2 Staking Launches on Mainnet

Ethereum 2.0 deposits are open on mainnet for prospective validators

UMA Introduces Developer Mining

The decentralized derivatives protocol introduced a novel new mining mechanism for developers

1inch Releases V2

The DEX aggregator released v2, featuring a new UI and more!

Notional Finance Brings Fixed Rate Lending to DeFi

A new protocol is here allowing anyone to lend and borrow crypto at fixed rates

In other news…

• Maker executive vote to onboard BAL and YFI as collateral
• Step by step guide on how to participate in APY Finance
• yEarn announces yveCRV Vault, codename yBackscratcher
• SnowSwap released details for OUSD staking

Stat Box

• Total Value Locked: $12.32B (up +12.4% from last week)
• DeFi Market Cap: $15.8B (up +7.4%)
• DEX Weekly volume: $3.2B (down -56% due to Harvest Finance exploit last week)
• DAI supply: 952.7M (up +2.8%) 
• Total DeFi users: 825K (up +10%)

Bonus Reads

• [Mara Schmiedt & Collin Myers – Bankless] ETH: The Internet Bond
• [Vitalik Buterin – Ethereum] Why Proof of Stake (November 2020)
• [CoinMetrics Team – CoinMetrics] Fundamentals show Bitcoin is poised for takeoff
• [Anthony Pompliano – The Pomp Letter] How investors are preparing for the 2020 election

Shoutout to Aave for supporting This Week in DeFi!

Aave is a leading lending protocol supporting dozens of the top DeFi tokens. Aave is currently undergoing its migration from LEND to AAVE which you can do directly through the migration portal!

We’ve done an extensive amount of coverage on Aavenomics – a new suite of protocol upgrades that incentives protocol safety through AAVE rewards and protocol fees. The best part about Aavenomics is that all of its parameters – including the logistics of Aave yield farming – are governed by tokenholders. There’s a ton of good activity happening on the Aave governance forum and we’d definitely recommend checking it out if you fancy yourself to be an Aavenger.

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