Weekly Yields

DeFi Shall Thrive: Crypto Weekly Newsletter #052

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Blur's NFT loans exceed $156M. MakerDAO launches Spark Protocol. Tether reports a $1.48B net profit. Binance exits Canada. Europe sees VC funding increase.

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Weekly Yields
Danail Velchovski
May 15, 2023
May 15

Welcome to this week’s newsletter.

Blur’s Blend NFT lending protocol has exceeded expectations, with over $156M in loans opened within two weeks. MakerDAO has also made a move in DeFi by launching the Spark Protocol to enhance its lending capabilities. Tether has reported a net profit of $1.48B but still faces criticism over transparency, and Binance has announced its exit from Canada due to regulatory tensions. Additionally, European crypto startups are seeing an increase in venture capital funding following the approval of the MiCA regulatory framework.

Let’s take a closer look at how the market has reacted.

Market update:

All major cryptocurrencies have recovered from their respective dips during the last 7 days, with Solana even gaining +2.94% to its price, marking an excellent +113.42% performance so far in 2023. Bitcoin currently trades at $27.457 and has a Mcap of $532B.

Data from May 15, 2023, at 19:00 UTC via Messari.io.

Latest news:

Blur Users Open $156M Loans Backed By NFTs In 2 Weeks

The newly launched Blur platform challenges OpenSea as the go-to NFT marketplace and continues to innovate. Two weeks ago, they introduced Blend, an NFT lending protocol that exceeded expectations with over $156M in loans within fourteen days.

Source: Dune

Over the past week, the platform has opened more than 3,200 individual Blend loans, accounting for 75% of the record-high NFT loan volume of $67M. Currently, Blend supports loans backed by four NFT collections, with Azuki being the most popular collateral (image above), representing nearly half of the active loans.

MakerDAO Launches Spark Protocol, a New DeFi Lending Solution for DAI Users

MakerDAO has launched the Spark Protocol, a lending solution for DAI users that will act as a “lending marketplace,” providing users with supply and borrowing features for cryptocurrencies. The platform is linked to Maker’s D3M, a system that enables interaction between the Maker ecosystem and third-party lending pools and seeks to enable users to borrow DAI at more competitive rates.

The Spark Protocol promises to enhance MakerDAO’s DAI lending capabilities, increase liquidity, offer users improved rates, offer a yield-bearing version of DAI, and provide more liquidity options.

Tether Reports Net Profit of $1.48B and All-Time High Reserves in Q1 2023

In its Q1 assurance report, Tether reported a net profit of $1.48B, with reserves reaching an all-time high of $2.44B, mostly held in cash and cash equivalents, with the majority invested in U.S. Treasury Bills. However, the report has yet to be independently audited.

Tether is the company behind USDT, the biggest stablecoin, with a market cap of $82.5B, and is the most traded cryptocurrency. Tether has been criticized for inadequate transparency, and its troubles continue, with reports that it used fake documents and shell companies to open bank accounts.

Binance Announces Exit from Canada, Citing Regulatory Tensions

Cryptocurrency exchange Binance has announced that it is ending operations in Canada, citing the challenging regulatory environment in the country. The move comes after the Canadian Securities Administrators (CSA) released new guidance prohibiting crypto asset trading platforms from allowing customers to buy or deposit stablecoins without the CSA’s prior approval.

Binance disagreed with the new regulations but still hopes to work with Canadian regulators to develop a regulatory framework around cryptocurrencies. The company’s CEO, Changpeng Zhao, is a Canadian citizen, and the decision to exit Canada is described as having “sentimental value.

VC Funding Flows into European Crypto Market Following Landmark Regulation

European crypto startups are seeing an increase in venture capital funding due to the recent approval of the Markets in Crypto Assets (MiCA) regulatory framework by the European Union. The new regulation aims to regulate crypto assets and those transacting them, making it the first significant step toward industry regulation.

Source: Twitter

As a result, VC investment into European crypto projects has increased nearly 10x in one year, with Europe accounting for 48% of all VC funding that went to crypto startups in Q2 2023. While England is no longer part of the EU, London-based crypto startups have successfully secured VC funding. Despite the increase in funding, VC funding for crypto startups has fallen 82% in the first quarter of 2023.

Other news

DeFi weekly stats:

Top Stablecoin Yield Pools (Single Exposure Filter)

Stablecoin yield pools remain the most predictable, with the top 4 pools being unchanged. Origin Dollar’s OUSD pool has achieved a 30d average APY of 5.06%, granting it a top 5 spot.

The top 3 Stablecoin Yield Pools By 30d Average APY (TVL>$30M) as of May 15, 2023. Data: DefiLlama

Top Blue-Chip Coins Yield Pools (Single Exposure + High Confidence Filters)

Blue chip yield pools have blossomed, with Aribtrum’s Premia getting 2 of its pool into the top 5. Yearn Finance remains dominant, with over $173M in TVL in its ETH pools.

The top 3 Blue-Chip Coins Pools By 30d Average APY (TVL>$30M) as of May 15, 2023. Data: DefiLlama

Top ETH Liquid Staking Derivatives Pools

Stafi’s RETH pool has fallen below $30M TVL, allowing for Frax’s SFRXETH pool to climb back to first place with 6.51% 30d Avg APY. Lido’s STETH pool has increased further to $12.2B in TVL, with a 5.37% 30d Avg APY.

The top 3 ETH LSD Pools By 30d Average APY (TVL>$30M) as of May 15, 2023. Data: DefiLlama

One Click updates

One Click Crypto is announcing that the locked liquidity on the OBT/BNB PancakeSwap pool has been extended for another 3 months until Aug 28, 2023, to ensure sufficient time to prepare for the upcoming 1CC launch and migration.

Final word

At the end of 2022, I wrote an article on Medium called “9 Hidden Web3 Trends,” which has since gained popularity. In it, I emphasized the importance of liquidity optimization in DeFi and NFT marketplaces. Now, a few months into 2023, we see the benefits of projects addressing this fundamental issue in the crypto space with Blur and Maker.

Additionally, we have previously discussed the importance of clear regulatory frameworks, and it has become increasingly evident that countries that have established such frameworks are leading the way in becoming the future crypto hubs, while the others are being left behind.

Max Yampolsky,
CEO at One Click Crypto
ir@oneclick.fi

DISCLAIMER:
This is not financial advice. This newsletter is strictly educational and does not provide investment advice, solicit the purchase or sale of assets, or encourage readers to make financial decisions. Please use caution and conduct independent research.

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Danail Velchovski

Danail masterfully combines his deep knowledge of blockchain technology and his strong writing skills to deliver crisp, comprehensive content. With his early immersion in the web3 domain, he navigates the complexities of this revolutionary technology with ease, turning intricate concepts into engaging, digestible pieces. His research acumen and keen insight into the rapidly evolving world of decentralized networks make him an invaluable asset in educating audiences about web3's potential and its ever-evolving landscape.

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