The 9th edition of our curated newsletter.
In today’s newsletter we look at:
- Impermanent losses counteraction
- How do different yVaults work
- Coinbase effect
- The concepts of sharding
- New Bancor liquidity mechanisms
- Kyber DMM release
Impermanent Loss: Explained by Binance
Chances are, DeFi enthusiasts might haven’t heard of impermanent loss. It happens when your tokens price changes after you deposited them in the pool. And larger changes are responsible for bigger losses. If you’re worried that providing liquidity might result in money losses, don’t panic just yet.
Impermanent loss (in fact, it’s pretty much permanent) can be counteracted by trading fees, but it depends on protocol, the specific pool, the deposited assets, and even wider market conditions.
In case you’ve spent the last few years under the rock, Yearn.Finance is one of the most talked-about DeFi projects that makers rather complicated yield farming (a process of making use of tokens in the DeFi market to earn interest) strategies available to any crypto user. The Yearn Vault strategies are designed to find the best possible path for DeFi investment.
Yearn State of the Vaults covering everything about Yearn Finance’s yVaults has published a new comprehensive piece that contains all yVault descriptions, including Yearn and Curve, v2 Vaults, v1 Curve Finance Based Vaults, v1 Vaults, and Retired Vaults. Bookmark this article if you’re planning on getting serious with yield farming.
How Coinbase Listings Affect the Prices
Coinbase is doing great. The Q1 2021 revenue is higher than the revenue for the whole of 2020. $1,1 billion in profit. Valuation over $100 billion. 56 million users. And tomorrow, the company is planning an IPO, which is definitely a positive sign for the whole crypto market.
Coinbase has a strong influence on the market in general, including asset prices. On our Twitter, we took a closer look at how listing affects the price of altcoins.
By implementing sharding, Ethereum plans to deal with the scalability issue (yet keep blockchain decentralized and secure) and allow using the network at affordable costs.
If you want to understand the depth of sharding, how it is different from other technologies, and what sacrifices sharded-based system makes to bring on all the benefits, this new insightful post by Vitalik is a must-read.
No-Liquidation Lending With Vortex by Bancor
Bancor introduced a new mechanism, Vortex, that allows users to lend crypto and at the same time maintain high liquidity through the use of its vBNT token. Vortex is changing the current mechanics of vBNT, the platform’s governance token received by users in exchange for BNT they’ve staked into the liquidity pool.
The new mechanism expands vNBT’s functionality and infrastructure, allowing users to buy the original BNT with the governance token and then exchange it for whatever asset they need. This way, Vortex becomes a no-liquidation lending platform that provides liquidity providers with the functionality to instantly receive their rewards.
Kyber Dynamic Market Maker Is Live
The mainnet beta release of Kyber’s Dynamic Market Maker protocol is finally out. The new development was designed for retail liquidity providers and token teams. So now, any liquidity provider can add their idle tokens to Kyber DMM pools, and takers such as dapps, aggregators, or end users can easily access this liquidity.
Launching the DMM protocol is a major event in the DeFi space as it features an open, permissionless liquidity contribution and extremely high capital efficiency and flexibility. Although still in beta, more tokens will work with DMM soon.
This is a weekly newsletter curated by our Blockchain Lead Vyacheslav Akhmetov. We cover the most sparkling events in the industry and sharing more about our journey.