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Money Legos keep stacking! Finance Redefined 4/21-4/28

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Joyful Wednesday fellow DeFi degens! 

I used to be anticipating to spend a big portion of this version of Finance Redefined analyzing Aave’s liquidity mining program. There was some anxiousness from buyers that the emission of two,200 $AAVE per day (which might translate to roughly 5% of the ecosystem reserve fund of two.8 million AAVE per 12 months) may find yourself dragging down the token’s worth as farmers earn and dump.  

I might really feel very uncomfortable holding an asset if the governance token of a vital protocol results in the fingers of people that solely take into consideration brief time period good points.

— Grogu (@eip1559) April 26, 2021

Seems, it is pointless: this system’s an unmitigated success. The AAVE token is up almost 15% for the reason that launch of liquidity mining to $462, and the protocol’s complete worth locked determine has surged to $11.8 billion — up from simply over $7 billion since liquidity mining started.

Nicely-researched liquidity mining works. Solely query now’s, if this system is discontinued, how a lot of that TVL will probably be sticky? 

Different narratives to keep a watch on: 

Money legos keep stacking

Initially of the 12 months there was hypothesis that in 2021 DeFi would see one thing of a novelty: one protocol buying one other, probably by way of a governance token buyout. The Synthetix 2021 roadmap specifically opened the door to such a chance, evaluating it to acquisitions in TradFi and trying to Yearn’s merger/acquisition/collaboration spree for inspiration. 

Massive-scale mergers and acquisitions have but to play out, nevertheless. There are some smaller examples brewing — Inverse Finance is presently trying to purchase out Tonic for some $1.6 million, as an example — however as an alternative what we’re seeing is a increase in deep integrations on the protocol and frontend layers.

Women and gents

We lastly current to you the primary on-chain DAO acquisition vote within the historical past of crypto

NEW ON-CHAIN PROPOSAL: Purchase Tonic Finance

Vote now: https://t.co/c4beGqz6t5

In the event you delegated another person, your delegate will vote in your behalf pic.twitter.com/inNwskammI

— Inverse.Finance (@InverseFinance) April 28, 2021

On Monday, Badger DAO and RenVM launched the Badger Bridge, a brand new interface for depositing native BTC into Badger vaults with just some clicks. The combination stands out for 2 causes. One is that it’s so clearly helpful for each events: an idiot-proof technique to earn yield on BTC is engaging for hodlers, that means Ren will see an uptick in exercise on its bridge (and subsequently protocol charges), whereas Badger likewise will get a lift in TVL.

The opposite angle, nevertheless, is the willingness with which Ren subordinated its branding, letting Badger — which, I’d argue, has the stronger neighborhood — take over the touchdown web page. Have been it not for absurd token valuations, one might need been an acquisition goal for the opposite, given the plain wants every fills — however by working collectively Ren will get the whole lot they’d need from a protocol like Badger, and the identical applies to Badger and Ren.

This raises the query: why trouble with takeovers when a pleasant integration can accomplish the identical results?

One other prime instance is right this moment’s Balancer-Gnosis Protocol announcement. You may see the main points in my piece, however successfully Balancer v2 is bringing some neat improvements to AMM liquidity provision and Gnosis’ CowSwap is a liquidity aggregator and offchain transaction batching protocol that can reportedly in the reduction of on miner extractable worth. The mixture of the 2 will make for a considerably extra feature-rich DEX from each a LP and dealer’s perspective — presumably even positioning the Balancer-Gnosis-Protocol as a Uniswap v3 competitor.

In a press release to Cointelegraph, Balancer CEO Fernando Martinelli famous that such a deep collaboration can be unattainable within the conventional finance world:

“Each of the two protocols would be impossible to implement in the traditional finance world simply because there is no such thing as trustlessness there (you always need an intermediary). Even if that were possible, combining these two protocols would be as much of a challenge as it would be to integrate Fidelity Index Funds (Balancer) with Nasdaq (Gnosis) under one single platform.”

Acquisitions could also be an outdated mannequin — or at the very least one that does not apply to DeFi. Interoperability and composability signifies that protocols can profit from each other with out hostile takeovers.

The branding may nonetheless must get discovered in sure cases, nevertheless — Balancer-Gnosis-Protocol isn’t precisely the very best title.

Two of the strongest groups in crypto and but not a single particular person mentioned yo bro cowswap looks as if a nasty title for our collaboration pic.twitter.com/MvHD9O4z9I

— ∞ CO฿IE (@CryptoCobain) April 28, 2021

Are you talking my language? 

The goalposts keep shifting for Ethereum maximalists as natural exercise begins to unfold to different chains. 

On Solana, as an example, $COPE and $STEP have attracted important neighborhood following and funding from main gamers (together with from funds apart from famous SOL supporters Alameda Analysis!), and this morning introduced a hackathon aiming to kick off the hashtag “solanaszn.” Folks have bandied round “Solana Summer” within the mould of final 12 months’s DeFi Summer season, however no matter your most well-liked sobriquet the competitors is for actual — nobody can cry “present me one developer constructing an actual XYZ” anymore. 

The success has — maybe predictably — led some observers to attempt to poke holes in SOL’s progress thesis. Whereas, like all chain, there’s loads of assault floor, one rising criticism is that Solana’s flagship language, Rust, is each troublesome and unique.

1/ in my humble and naïve opinion, Rust is likely to be an preliminary bottleneck for Solana dev adoption as its solely barely simpler than studying C++ and can take time to have individuals to choose it up

— 10spot (@10spot1) April 24, 2021

In a press release to Cointelegraph, Solana founder and present Solana Basis president Anatoly Yakovenko rejected that view. 

“Rust is a modern language with wide adoption suitable for writing high performance secure code. It has ranked on Stack Overflow as one of the most loved programming language by 65,000 people who code, so we are confident this plays a key role in driving the organic growth in our developer community to date,” he mentioned.

He additionally famous that the Basis has counted 2,000 builders constructing on Solana (he didn’t point out methodology or definitions used to reach on the determine, and it appears maybe a contact inflated given {that a} 2019 research from ConsenSys discovered that there’s about 1,300 Ethereum builders, and in 2020 Electrical Capital pegged the full variety of ETH devs round 2,300), and that Solana devs aren’t serious about “copy/pastes” of Ethereum initiatives.

He’s additionally proper concerning the Stack Overflow research, although a 2018 survey from the Rust Weblog confirmed that over 20% of builders working with the language felt unproductive after a 12 months of use.

No matter you are feeling about Rust, nevertheless, crypto is all about incentives — which implies it is an issue that cash can repair. And to that finish Solana is urgent the pedal: the hackathon will characteristic “up to $1 million” in prizes and/or seed funding. I feel I might study a tricky language for that.

1/Saying the Solana Season Hackathon! #solanaszn

As much as $1 million in prizes/seed funding
Anybody with an web connection can be a part of
4️⃣ Further regional tracks
️ Working Might 15 – June 7
Registration is stay right this moment pic.twitter.com/3yeMoW7BLy

— Solana (@solana) April 28, 2021

Different tales this week:

Uranium Finance loses $50 million, probably rug

ETH cracks all-time highs

Aave’s liquidity mining program a hit out of the gate

NYSE president bullish on DeFi

Supply