The DeFi space is on a path of steady recovery as good actors

The harm that was inflicted by the collapse of major cryptocurrency ecosystems in the previous year is on its way to making a gradual comeback as positive actors take aggressive initiatives to reestablish investors’ faith. Principal participants from the ecosystem of decentralized finance (DeFi) got together to discuss the benefits of running trustless, interoperable, and permissionless systems.

Over thirty DeFi protocols participated in an endeavor to “permissionlessly” distribute tweets from other protocols for a period of twenty-four hours, beginning on February 6 and continuing until February 7. This served to showcase the permissionless and interoperable nature of Web3.

This campaign has contributions from a number of different projects, some of which include, MakerDAO, SushiSwap, and Aave.

Despite the fact that DeFi has gained widespread recognition and big institutions have made their entry into the field, its image is still fragile owing to the numerous exploits that it has participated in.

The chief marketing officer of MakerDAO, Mamun Rashid, said that in order to fulfill the “full potential” of DeFi, there has to be a partnership between the ideas and the talent that is present in the field.

“By working together, we will be able to push the limits of conventional banking and create a financial system that is more welcoming and accessible thanks to decentralized money.”

The “spirit” of DeFi was characterized as a more collaborative environment, rather than a more competitive one, by the projects that were working together on the campaign.

According to Jared Grey, CEO of SushiSwap, the goal of the construction of DeFi is to disrupt the status quo of recognized financial frameworks, which have traditionally been known to impose hurdles and decrease economic freedom.

“By using the modularity of this cutting-edge technology, we are able to democratize the financial industry and provide tools and services that are more egalitarian, safer, and more transparent to an audience on a global scale.”

According to what Grey stated, the obligation to represent the genuine meaning of Defiantly Fiction begins in the space itself. Therefore, the initiative taken by more than 30 builders inside the area and the unity shown by those builders came at a crucial moment.

The DeFi domain has been a primary focus of adventures throughout the course of the last year. According to a study that was compiled by Beosin in 2022, the greatest number of assaults were launched against DeFi-based initiatives.

This weakness was the root cause of a 47.4% increase in security losses in 2022 when compared to the previous year’s total of $3.64 billion in losses, which came to a total.

Additional research from the industry has shown that it is reasonable to anticipate that the current trend of DeFi exploits will continue into this year owing to the introduction of new products to the market and the development of more skilled cybercriminals.

According to a research published by DappRadar, despite this, the industry saw strong growth to begin the year. To encourage more people to use DeFi and Cosmos, the company Injective established a new ecosystem fund in the amount of $150 million in January.


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SushiSwap to Redirect Trading Fees to its treasury

The decentralised exchange (DEX) SushiSwap will, in the near future, reroute one hundred percent of the trading fees that are collected on the platform to its treasury in order to pay for ongoing operations and maintenance for a period of one year. This decision was made in accordance with a governance proposal that was approved on January 23.

After receiving a warning from the CEO that the market could potentially become unstable, the decision to take action was made “Even after lowering annual operational expenses from $9 million to $5 million in the midst of the protracted crypto winter, barely has enough runway in its treasury to last for another 1.5 years.

In the event that this proposal is accepted, the income that is brought into the treasury will be divided between ETH and USDC in a manner that is equal to each other, and it is anticipated that this revenue will total around $6 million over the course of the next year.”

In a second motion that was put to a vote and passed on the same day, 99.85 percent of voters decided to “clawback” 10,936,284 SUSHI tokens with a total value of $14.8 million. These tokens had been distributed to early liquidity providers at the launch of the DEX in 2020 but no one had claimed them. The motion was approved.

Users of SushiSwap who provided trading liquidity for the exchange throughout the months of August 2020 and February 2021 were eligible to claim the rewards, which had been made available to users for more than two years at that time.

Several of the commentators said that “people have earned their SUSHI fair and square,” and that their title to these assets should not be denied because of this fact. In addition, they stated that “people have earned their SUSHI fair and square.”

Others have voiced their support for the clawback on the basis that it removes “idle SUSHI that may be put to higher use.” 

The money will be transferred over to the common account that SushiSwap uses.


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SushiSwap CEO Suggests New Tokenomics For Liquidity And Decentralization


According to a request that was presented on the 30th of December on the Sushi’s forum, Jared Grey, the Chief Executive Officer of the decentralized exchange SushiSwap, has plans to restructure the tokenomics of the SushiSwap token.

In the new model of tokenomics that has been presented, time-lock tiers will be implemented for emission-based incentives. Additionally, a token-burning mechanism and a liquidity lock will be included in order to provide price support.

According to Grey, the new tokenomics plan is to increase “treasury reserves to assure continued operation and growth.” Additionally, the plan seeks to improve the platform’s liquidity and decentralization.

According to the approach that is being suggested, liquidity providers (LPs) would get 0.05% of the money generated from swap fees, with bigger volume pools receiving the largest proportion.

LPs will also have the option to lock their liquidity in order to receive increased rewards that are depending on emissions.

Additionally, staked SUSHI (xSUSHI) will not earn any portion of the fee money; rather, it will receive awards determined by emissions and paid out in SUSHI tokens.

Emissions-based awards will be determined using time-lock levels, with longer time locks resulting in larger prizes than shorter time locks.

It is possible to make withdrawals prior to the expiration of time locks, albeit doing so will result in the rewards being lost and destroyed.

The decentralized exchange will utilize a configurable amount of the 0.05% swap charge in order to purchase the SUSHI token again and then destroy it.

The percentage will adjust itself according to the total number of time-lock levels that are chosen.

After disclosing that it had fewer than 1.5 years of runway left in its treasury, which means that a huge deficit was jeopardizing the exchange’s economic sustainability, SushiSwap decided to rework its tokenomics. This decision was made after the company made this revelation.

Due to the fact that the token-based emission approach caused SushiSwap to incur a loss of $30 million over the course of the previous 12 months on incentives for LPs, the firm made the decision to implement the new tokenomics model.


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SUSHI Price Posts Significant Leap Amid GoldenTree’s $5.3M Stake in Sushiswap

The price of SushiSwap has risen by 23.76% in the last 7 days. The price rose by 2.99% in the last 24 hours. In just the past hour, the price grew by 0.39%. At the time of writing, the current price is $1.35 per SUSHI, according to CoinMarketCap. SushiSwap is 94.15% below the all-time high of $23.38.

SushiSwap price has made a strong surge this week as investors react to several important developments within the ecosystem. First, on Monday, Sushi DAO changed its leadership team and as a result elected Jared Grey as the “head chef”, the equivalent of a CEO.

Grey, the CEO at crypto exchange Bitfineon and former CEO of decentralized finance (DeFi) platform EONS, is a highly experienced professional who has established many crypto startups in the past few years. In a statement, Grey said he wants to bolster engagement on the Sushiswap platform, improve the exchange’s internal organization as well as focus his time on revenue and market share growth.

Multiple technical analysts on Twitter also believe SUSHI’s recent positive performance is tied to the recent investment by GoldenTree Asset Management in Sushiwap. On Wednesday, GoldenTree invested about $5.2 million in the SushiSwap governance token. GoldenTree disclosed a $5.3 million token stake in decentralized exchange (DEX) SushiSwap – a development that sent the SUSHI token surging 13% as bullish investors piled in.

GoldenTree explained the reason for such investment, stating that it has been amazed by the resilience of both SUSHI’s core team and the community in the face of challenges, “as they continued to build and release top-tier products.”

The renewed bullish activity surrounding the Sushiswap token is reflected in the rising social volumes, supported by a surge in the weighted social sentiment, as result bolstered the recent price growth.

SUSHI community elections and GoldenTree’s announcement came when interest in SUSHI was seeing an uptick. Between October 4 and October 6, active addresses on the SUSHI protocol rose from 306 to peak at 811, though currently, the figure stands at around 700.

The token’s trading volume also rose from $32 million on October 1 to peak at $201 million on October 6, according to Santiment data. SUSHI’s supply distribution also indicates that addresses holding 10,000 to 100,000 tokens and 100,000 to 1 million tokens surged with the uptick in prices as whales sought more accumulation.

Image source: Shutterstock


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Users flock to Curve amid lack of stablecoin liquidity on major DEXs

In a Tweet posted by user @cryptotutor Friday, a screenshot appears to show a 27% spread between stablecoin Magic Internet Money (MIM) and USD Coin (USDC) trading pair on decentralized exchange, or DEX, Uniswap (UNI). Both have a theoretical peg of 1:1 against the U.S. Dollar.

“Magic Internet Money,” joked cryptotutor, as he attempted to swap approximately $1 million in MIM but received a quote for only 728.6k USDC. Others quickly took to social media to complain as well. In another screenshot, user @DeFiDownsin allegedly received a quote to swap $984k worth of MIM for just 4,173 in USDT on SushiSwap (SUSHI).

Curve, a popular platform for stablecoin trading, offered their insight on the matter. “Uniswap actually now works much better than what the screenshot shows. Sushiswap is just unsuitable for stablecoin-to-stablecoin swaps always,” said the Curve team via a Tweet.

During bear markets, investors typically flee from holding volatile cryptocurrencies and instead pile into stable assets that generate fixed income. For example, the amount of deposits in Terra Luna’s flagship stablecoin savings protocol, Anchor, which promises yields of up to 20%, has increased from $2.3 billion to $6.1 billion in the past 60 days.

However, the capital flight has also resulted in issues, such as stablecoin liquidity disappearing from exchanges, causing their spread to widen to excruciating levels. In addition, the flock of stablecoins into the Anchor protocol has caused its yield to become unstainable as there are not enough borrowers to pay depositors’ interest.

But despite large fluctuations in the market, Curve appears to be doing better than ever. According to its developers, the platform saw a record trading daily volume of $3.6 billion, with total deposits surpassing $16.7 billion. Investors typically seek to take advantage of the occasional difference between stablecoins’ theoretical peg to fiat money or other stablecoins to make a profit.