👷🏻♀️ Polkadot’s Parachain Winners Make Strides in Building Sharded Ecosystem
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AUCTIONS Polkadot’s first round of five parachain auctions have concluded and the winners are now producing blocks, setting Polkadot’s sharded ecosystem into motion for the first time.
BUILDING OUT The launch of parachains ushers functionality for smart contracts and other specialized computation on the Polkadot network, allowing top developers to begin building out Polkadot’s DeFi and the broader ecosystem.
STAKING The first five parachains belong to fintech-focussed DeFi hub Acala Network, EVM-compatible smart contract network Moonbeam, WASM and EVM smart contract platform Astar Network, decentralized lending and staking platform Parallel Finance, and cross-chain compatibility platform Clover Finance.
TRANCHES OF TOKENS Each project went live as a parachain and began producing blocks on Dec. 18. The winners now predict their dapps and liquid staking derivatives will go live before February, with the initial tranches of tokens distributed through the auctions also slated to unlock during January.
DOUBLE DIGITS It’s been a tough year for many DeFi protocols originating on the Ethereum blockchain. Despite being up in dollar terms, top tokens like UNI, MAKER, AAVE and Yearn Finance’s YFI have bled double digits against ETH in 2021.
CATALYST The apparent catalyst for YFI’s momentum is the token’s revamped tokenomics, according to a post linked by Yearn on Dec. 19. The proposal hasn’t been approved, but it is expected to do so, according to the post, which says the mechanics will create a “black hole “for YFI, meaning supply will come off the market along with a corresponding price increase.
YFI First and foremost among the proposed changes is the ability to stake YFI in exchange for xYFI, holders of which will receive additional YFI which Yearn buys on the open market. The mechanic will directly reward stakers while the purchases push YFI’s price northward.
NEWS Here comes SQUEETH. Decentralized options protocol Opyn is readying to launch its Squared ETH or SQUEETH token, which is designed to hedge ETH-based liquidity provider (LP) positions on automated market maker (AMM) exchanges.
DEFI PRIMITIVE In a Dec. 17 blog post, Opyn developer Joe Clark described SQUEETH as a “new DeFi primitive” that allows stablecoin/ETH liquidity providers to earn swap fees without being exposed to the impact of price fluctuations in Ethereum.
YIELD The instrument will be a new addition to Ethereum’s growing ecosystem of decentralized derivatives, with DeFi traders able to hedge using yield tokenization, leveraged tokens, structured options products, and futures contracts offered by decentralized protocols. Opyn has not announced an expected launch date for the product.
Comparative curvatures of Uniswap v3 LP position for USDC/ETH, SQUEETH, and ETH short positions. Source: Joe Clark
BUZZ WORDS Crypto is an industry known for entrepreneurs slapping buzz words on projects they hope hit the jackpot. A less trod path is buying a venerable brand that went bankrupt in 2015, and resuscitating it as a DeFi project.
OBJECTIVE That’s what’s happening with RadioShack, a 100 year-old consumer electronics retailer revived by internet entrepreneurs Tai Lopez and Alex Mehr as a DeFi protocol. The new RadioShack’s primary objective is to distribute blockchain technology, according to the project’s docs, which target “blue chip, large corporations” as adopters.
JUMP THE SHARK The project has raised some eyebrows as a possible jump-the-shark moment. “We have a month, 6 weeks tops left in this bull market,” tweeted Brantly Millegan, director of operations at Ethereum Name Service. “If RadioShack DeFi and Melania NFTs aren’t a signal then I don’t know what is.”
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🧑💻 ✍️ Stories in The Defiant are written by Brady Dale, Owen Fernau, Samuel Haig, DeFiDad, and yyctrader, and edited by Edward Robinson, yyctrader, and Camila Russo. Videos are produced by Robin Schmidt, Alp Gasimov and Daniel Flynn. Podcast is led by Camila, edited by Alp.
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