The market takes ETH, wstETH, WBTC and cbBTC as collateral against USDC at loan-to-value ratios of up to 87%. Compound says borrowing is open to anyone, with approval required only for the 200,000 USDC in supplier rewards.
Compound Foundation has opened a USDC lending market that takes ETH, wstETH, WBTC and cbBTC at loan-to-value ratios of up to 87%, three weeks after relaunching the protocol around institutional credit.
The Institutional Market is the first product out of the $52 million program COMP holders approved in May, and it went live under a control structure the DAO never voted on. The Treasury Management Committee administers the market and a separate Safe holds authority over its collateral and parameters, an arrangement a Compound delegate is now asking COMP holders to reverse.
The market lends USDC against ETH, wstETH, WBTC and cbBTC, and runs on Compound v3. Compound holds $1.53 billion in total value locked with $638 million borrowed against it, sixth among lending protocols on DefiLlama and up 23% over 30 days. Ethereum carries $1.42 billion of that, or 93%. COMP trades at $20.88, up 9% over seven days, for a market cap of $212 million.
"With today's Institutional Market launch, we are taking the first step toward building infrastructure to meet institutional client demands, including better capital efficiency, clearly defined risk, and a much higher standard of service," said Aaron Schnarch, executive director of Compound Foundation. "We are encouraged by the market demand, and look forward to launching additional capabilities over the coming months."
Oversubscribed At LaunchCompound says the market was oversubscribed on day one, with DeFi Saver, K3, KPK and Yearn taking part. The company gave no figure for how much was subscribed.
"Compound is combining the capital efficiency of onchain markets with the level of service institutional participants expect. The ability to access more efficient borrowing while working directly with a team that understands institutional requirements makes this a compelling new market for us," said Marcelo Ruiz de Olano, co-founder and CEO of KPK.
Four Assets, One BorrowThe collateral list is short and liquid: two forms of ether and two forms of wrapped bitcoin.
Compound's argument is that a market holding only those four assets can run higher loan-to-value ratios than one that has to price the tail, and that lenders capture better economics as a result. Borrowing is open to anyone. The approval process and a 100,000 USDC minimum deposit apply to the boosted supplier rewards, which run to 200,000 USDC paid pro rata over three months against a $20 million supply cap.
Compound's market page puts ETH at an 87% loan-to-value ratio, wstETH at 85%, and WBTC and cbBTC at 81%, with a $10 million borrow cap on each. Liquidation factors run from 93% on ETH to 86% on the two bitcoin assets, and liquidation penalties from 5% on ETH to 10% on WBTC and cbBTC.
The Foundation has described the market to delegates as an Institutional Comet built under v3.5, outside the V4 roadmap the DAO funded, to test an institutional use case. Compound also says v3 has run four years without an exploit, a claim worth stating as the company's own.
Who Holds The KeysCompound delegate ugurmersin asked COMP holders on Sept. 9 to move ultimate control of the market to Compound governance, writing that the DAO "does not currently appear to have ultimate control over Institutional Comet" and that he could find no governance authorization for the current structure or any way for COMP holders to revoke it. The proposal would leave day-to-day operation with the Foundation and the committee while requiring the administrators to publish a full permissions map within 10 business days and transfer ultimate authority within 30. It also notes that the committee's mandate from the DAO covers treasury management, not administering a lending market. The Foundation had not responded on the forum as of Wednesday.
Mostly Still In ReserveCOMP holders approved the budget on May 8, with 1.88 million COMP in favor and none against, and it executed two days later. The Foundation made it public on Aug. 17 alongside four hires from Coinbase, Anchorage, NEAR and Maple. Schnarch, the executive director, was chief operating officer of Anchorage Digital and chief executive of Coinbase Custody. The two-year budget runs $28 million for operations and $24 million for growth, but only $14 million went to the Foundation's multisig; the other $38 million sits in reserve against milestones that include a staffed engineering team and a production v3 integration kit.
Shipping an institutional product three weeks in is the first of those milestones met in public. Whether the remaining $38 million follows is a DAO decision, not a Foundation one.
The $480 Billion LineCompound's boilerplate puts the protocol at "approximately $480B in deposits and borrowing volume" since 2018. Compound sits behind Aave's $17.5 billion and Morpho Blue's $9.6 billion in a lending category holding $50.2 billion across 639 protocols, with 3.1% of the total.
Compound wrote the template for onchain lending in 2018 and now holds less than a tenth of Aave's deposits, and the institutional market is its attempt to win back size on terms and service rather than rates. Compound calls it the first in a planned series built around different collateral types and borrower profiles.
CORRECTION, Borrowing is open to anyone and approval applies only to the supplier rewards; COMP holders approved the program in May and the Foundation made it public in August; the participant is K3. The story has also been updated with the market's liquidation parameters and with a governance proposal filed Sept. 9.
Compound Foundation launched a permissioned lending market on September 8 that only institutional borrowers can access, effectively carving the protocol’s liquidity pool into two distinct layers. Whitelisted participants get their own collateral sets, custom loan-to-value ratios, and tailored risk parameters, all separate from the retail-facing side of the protocol.
The move comes three weeks after Compound relaunched itself around institutional credit, and roughly a month after a DAO vote approved a $52 million development program, the largest funding initiative in the protocol’s history.
A protocol reinventing itself In August, Compound’s DAO greenlit the two-year, $52 million budget with $14 million released upfront and the rest gated behind milestones. The program is focused on onboarding regulated financial players: banks, asset managers, exchanges, and fintechs.
Leading the charge is a new executive team with deep roots in traditional finance. Aaron Schnarch, formerly CEO of Coinbase Custody, now serves as Executive Director. Christopher Donovan holds the COO role, Steven Liu is CPO, and Leo Eikelman fills the CTO seat.
The foundation says it has more than 10 confirmed partners, with discussions underway with over 20 additional potential collaborators.
Under the hood, the development program is building out compliance tooling including KYC and AML infrastructure, permissioned vaults, and integration kits designed to plug Compound’s lending rails directly into institutional workflows.
Why institutions, why now Compound’s total value locked currently sits at roughly $1.2B, down from a peak of $12B in September 2021. Since its 2018 launch, Compound has processed approximately $480B in total deposits and borrowing volume, and has recorded zero bad debt across its entire operational history.
The permissioned market structure directly addresses the single biggest objection institutions have had to DeFi participation: regulatory risk. By creating a walled-off environment where only whitelisted, KYC-verified entities can borrow, Compound sidesteps the compliance concerns that have kept most regulated capital on the sidelines.
The competitive landscape shifts The development program explicitly targets RWA support, which positions Compound to facilitate lending against tokenized treasuries, bonds, and other traditional financial instruments.
For existing COMP token holders, the strategic pivot carries both promise and risk. If institutional capital flows materialize, the protocol’s revenue and TVL could recover meaningfully from current levels. The milestone-gated budget structure provides some protection against the $52M being spent without results, but $14M is already out the door.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
Compound Foundation has launched a USDC lending market with loan-to-value ratios of up to 87% as part of its $52 million plan to attract institutional capital.
Summary
The market supports ETH, wstETH, WBTC, and cbBTC as collateral for USDC borrowing. Loan-to-value ratios range from 81% for Bitcoin collateral to 87% for ETH. Compound said DeFi Saver, K3, KPK, and Yearn joined the oversubscribed launch. A Compound delegate has questioned whether the DAO retains final control over the market. Compound Foundation said in a Sept. 9 announcement that its Institutional Market runs on Compound v3 and separates selected collateral into a lending pool designed around specific liquidity and risk conditions.
Borrowers can use Ether (ETH), wrapped staked Ether, Wrapped Bitcoin, or Coinbase Wrapped BTC to access USDC. The market gives ETH an 87% loan-to-value ratio, while wstETH carries an 85% ratio. WBTC and cbBTC each have an 81% ratio.
Each collateral asset has a $10 million borrowing cap. Liquidation factors range from 86% for WBTC and cbBTC to 93% for ETH, while penalties begin at 5% for ETH and rise to 10% for both Bitcoin-backed assets.
Compound promoted the product as an institutional-only market in its announcement. However, its official market page states that anyone can borrow, while approval applies to suppliers seeking additional incentives.
Compound market pairs higher LTVs with a narrow collateral list By limiting the market to four liquid collateral assets, Compound said it can offer terms based on their individual risk and liquidity profiles instead of applying one set of conditions across a large group of tokens.
Institutions often manage larger positions and follow internal risk controls that differ from those of retail users, according to the foundation. Compound said the new structure provides increased borrowing capacity, defined collateral parameters, and direct operational support.
A dedicated contact will assist participating institutions with onboarding, market updates, and other operational matters. Compound also said USDC suppliers will receive the standard market yield, while approved lenders can qualify for extra incentives.
The rewards program will distribute as much as 200,000 USDC on a pro-rata basis over three months. Applicants must supply at least 100,000 USDC, and only the first $20 million in eligible deposits will count toward the program.
Compound said the market was oversubscribed when it opened, naming DeFi Saver, K3, KPK and Yearn among the participants. The foundation did not provide the amount committed or explain how much demand exceeded the available capacity.
“With today’s Institutional Market launch, we are taking the first step toward building infrastructure to meet institutional client demands, including better capital efficiency, clearly defined risk, and a much higher standard of service,” Compound Foundation Executive Director Aaron Schnarch said.
According to Schnarch, early demand encouraged the foundation, which plans to release more capabilities over the coming months.
KPK co-founder and CEO Marcelo Ruiz de Olano said direct access to a team familiar with institutional requirements made the market attractive to his company.
“Compound is combining the capital efficiency of onchain markets with the level of service institutional participants expect,” Ruiz de Olano said.
Institutional market follows Compound’s $52 million program Three weeks before the product launch, crypto.news reported on Compound’s new management team and its DAO-approved, two-year development program.
COMP holders approved $28 million for operations and another $24 million for growth and incentives. The package represents the largest development allocation in the protocol’s history, according to the foundation.
Only $14 million was moved to the foundation’s multisignature wallet at the start of the program. The remaining $38 million stayed in reserve, with future releases linked to delivery targets such as assembling an engineering team and producing a Compound v3 integration kit.
Along with Schnarch, the management group includes Chief Operating Officer Christopher Donovan and Chief Product Officer Steven Liu. Team members brought experience from Coinbase Custody, Anchorage Digital, Near Foundation, Maple Finance, HSBC, and Broadridge Financial.
The program covers institutional lending, real-world assets, and tools that allow financial companies to connect with Compound’s infrastructure. Improving capital efficiency also forms part of the plan, as does building credit products around traditional finance requirements.
Founded in 2018, Compound helped establish blockchain-based borrowing and lending through permissionless markets governed by COMP holders and delegates. The foundation says the protocol has processed about $480 billion in cumulative deposits and borrowing volume, although the figure does not represent current assets held on the platform.
Data cited by The Defiant placed Compound’s total value locked near $1.53 billion around the launch, with approximately $638 million borrowed. Ethereum accounted for about $1.42 billion, or 93%, of the protocol’s locked assets.
US financial firms are also expanding crypto-backed credit For US institutions, Compound’s use of USDC and Bitcoin or Ether collateral places the product alongside several recent crypto-backed lending programs, although the legal structures and access models differ.
In August, JPMorgan’s collateral program was reported to allow institutional clients to pledge Bitcoin and Ether for US dollar loans through its Kinexys digital asset platform. Fidelity Digital Assets and Coinbase Custody were named among the custodians holding the pledged assets.
Kraken and Maple also introduced a USDC-funded lending facility in June. Their structure uses a bankruptcy-remote special purpose vehicle to fund overcollateralized loans backed by Bitcoin and Ether, with Maple providing senior financing and Kraken servicing the loans.
Retail access to onchain credit has expanded through centralized platforms as well. Coinbase added an Ethena-linked USDC vault in June, using Morpho markets and allocations managed by Steakhouse Financial.
Unlike bank and special-purpose-vehicle lending arrangements, Compound’s new market operates through its v3 smart-contract infrastructure. The foundation described Compound v3 as having completed four years of production use without an exploit, a performance claim made by Compound rather than an independent auditor.
Compound delegate questions who controls the market While the product was open, Compound delegate ugurmersin submitted a governance proposal asking for the DAO to receive ultimate authority over the Institutional Market.
The delegate said Compound governance did not appear to have approved the market’s current control structure. According to the proposal, the Treasury Management Committee administers the product, while a separate multisignature wallet holds authority over its collateral settings and other parameters.
Ugurmersin also said the committee’s existing DAO mandate covers treasury management rather than the operation of a lending market. The delegate could not identify a mechanism allowing COMP holders to withdraw the administrators’ permissions under the present setup.
Under the proposed changes, the foundation and committee could continue handling daily market operations. Administrators would have 10 business days to publish a full map of their permissions and 30 days to transfer final authority to Compound governance.
The Compound Foundation had not posted a public response to the governance proposal at the time of publication.
Independent OpenZeppelin review of TxFlow’s bridge contract marks another step in TxFlow’s approach to security as its L1, DEX, and builder ecosystem continue to develop.
TxFlow announces the completion of an independent security audit by OpenZeppelin, one of the world’s most established blockchain security firms, trusted by major organizations and protocols including Coinbase, the Ethereum Foundation, Uniswap, Aave, Arbitrum, ZKsync, Compound, and others.
OpenZeppelin’s review covered TxFlow’s bridge contract, a critical component of the infrastructure supporting the movement of capital between external networks and TxFlow L1. OpenZeppelin’s review identified zero critical and zero high-severity findings. One medium-severity finding was identified and resolved during the audit process.
The independent review forms part of TxFlow’s broader approach to incorporating external security expertise as its financial infrastructure and ecosystem continue to develop. Alongside TxFlow DEX and continued L1 development, TxFlow is also building Builder Code, with additional details to be announced as both initiatives move closer to release. Together, these developments support TxFlow’s broader objective: to build a Layer 1 designed specifically for financial markets, bringing trading, liquidity, and financial applications onto one blockchain where all finance happens.
Security at TxFlow L1 is a continuous responsibility: An Independent Review by OpenZeppelin As part of this commitment, we work with leading independent security experts to rigorously assess our infrastructure. In 2026, OpenZeppelin completed a security audit of Bridge2, the USDC bridge connecting Arbitrum One to TxFlow L1. TxFlow aims to continue to strengthen its security architecture, monitoring, and operational safeguards as the network evolves. The audit report provides the technical scope, findings, and assessment from OpenZeppelin and is available for the community to review directly.
TxFlow’s broader bridge infrastructure supports deposits and withdrawals across Arbitrum One, Ethereum, Base, Polygon PoS, and Solana. TxFlow’s documented bridge flow includes controls around the movement of funds, including validator-approved withdrawals and a built-in safety wait before withdrawals are completed.
These controls form part of TxFlow’s approach to protecting one of the most important functions of financial infrastructure: the movement of capital between networks.
Global-Grade Security from the Ground Up TxFlow is building its security program with the standards expected of serious financial infrastructure in mind. To support that approach, TxFlow engaged OpenZeppelin, one of the world’s most established blockchain security firms. OpenZeppelin has completed more than 900 security audits, identifying more than 10,000 issues, including 700+ critical and high-severity vulnerabilities, across blockchain protocols and financial infrastructure.
Its security work spans major crypto organizations and ecosystems including Coinbase, the Ethereum Foundation, Uniswap, Aave, Arbitrum, ZKsync, Optimism, and Compound, as well as established financial institutions and infrastructure providers including DTCC, Fidelity Digital Assets, WisdomTree, ANZ, and CACEIS.
For TxFlow, working with globally recognized security specialists at an early stage establishes a clear approach: independently review critical infrastructure as the network and ecosystem grow. Security is not an add-on to financial infrastructure. It is part of the infrastructure itself.
Building Infrastructure for On-chain Finance TxFlow L1 is designed specifically for financial markets and applications.
TxFlow DEX, a fully on-chain central limit order book for perpetual markets, is the first application built on TxFlow L1. The DEX is the first product operating on a broader infrastructure layer. TxFlow L1 is designed to support multiple financial applications and markets on the same network, including perpetuals, spot markets, prediction markets, and new categories of on-chain financial products. Through TxFlow Improvement Protocol (TIP) Liquidity Standards, Channels can connect to common execution, settlement, and liquidity infrastructure rather than operating as isolated applications.
For traders, that means infrastructure designed around markets from the start.
For builders, it creates a foundation for developing new financial applications on a network designed for trading, liquidity, and settlement.
What’s Next: Builder Code Alongside continued development of TxFlow L1 and TxFlow DEX, the team is building two new ecosystem initiatives: TxFlow Builder Code.
Builder Code is being developed to expand how builders and ecosystem participants can contribute to and grow alongside the network. For the TxFlow community, these initiatives represent the next stage of ecosystem growth: more ways for traders to participate, more ways for builders to contribute, and more activity across the TxFlow network.
About TxFlow L1 TxFlow L1 is a high-performance blockchain built for on-chain financial infrastructure, organized around TIP Liquidity Standards that define how financial products are built, composed, and settled on-chain. TxFlow DEX is the first Channel on TxFlow L1, a CLOB orderbook DEX for perpetual trading, processing over 250,000 TPS with one-block finality. Through its TxFlow Improvement Protocol standards and Channel architecture, TxFlow enables spot markets, derivatives, prediction markets and future financial products to operate on the same chain while connecting to shared execution and settlement infrastructure where all finance happens. TxFlow L1 is building an open, composable and community-owned financial ecosystem in which each new application can strengthen the infrastructure available to those that follow.
About OpenZeppelin OpenZeppelin is a leading security partner for on-chain finance, trusted by organizations including DTCC, Fidelity Digital Assets, WisdomTree, Coinbase, Uniswap, Aave, and the Ethereum Foundation. Since 2015, OpenZeppelin has secured more than $35 trillion in value transferred and delivered 900+ security engagements, surfacing more than 10,000 vulnerabilities across critical on-chain infrastructure. Its open-source smart contract libraries are an industry standard used across leading stablecoins, tokenized assets, and blockchain applications.
Not financial or tax advice. PANews content is strictly educational and informational and is not investment advice, financial advice, tax advice, legal advice, or a solicitation to buy or sell any digital asset, security, or financial product. Do your own research and consult qualified advisers.
Disclosure. PANews may publish sponsored content, partner content, advertisements, affiliate links, event promotions, and market commentary involving Web3 projects, service providers, or financial products. PANews personnel, contributors, or affiliates may hold digital assets or other interests related to covered topics. See our Terms of Service.
Decentralized finance protocol Compound has secured formal approval for a substantial two-year development allocation aimed at accelerating its shift toward institutional participants.
The Compound decentralized autonomous organization endorsed a $52 million program—the largest funding commitment in the protocol’s history—to develop infrastructure that supports on-chain credit services tailored for traditional financial entities.
This decision comes as the protocol seeks to reposition itself in a maturing DeFi landscape.
Since its launch in 2018, Compound has processed roughly $480 billion in deposits and borrowing activity while maintaining a record of zero bad debt.
Its codebase remains one of the most widely forked and battle-tested in the sector.
Yet total value locked has declined sharply from a 2021 peak near $12 billion to approximately $1.2 billion, prompting a strategic recalibration away from retail-focused yield incentives.
Central to the new direction is a refreshed leadership group drawn from both traditional finance and digital asset organizations.
Aaron Schnarch, previously chief executive of Coinbase Custody, assumes the role of executive director.
Christopher Donovan joins as chief operating officer after serving in the same capacity at the Near Foundation.
Steven Liu takes the position of chief product officer, bringing experience scaling Maple Finance’s assets from $500 million to $5 billion.
Leo Eikelman has been appointed chief technology officer.
Collectively, the team brings extensive backgrounds in building and expanding institutional-grade systems across conventional finance and crypto infrastructure.
The budget is structured to promote accountability.
Approximately $14 million becomes available immediately, while the balance is released in stages contingent on reaching predefined milestones.
Roughly $28 million is designated for operational and engineering work, including development of Compound V4.
1/ Compound is entering its next era.
Today we're announcing a new leadership team and a $52M DAO-approved development program,the largest in the protocol's history, to bring institutional credit onchain.https://t.co/gMJMSVg2ZX
— Compound Foundation (@Compound_xyz) August 17, 2026
The remaining $24 million supports growth activities, of which $8 million to $10 million is specifically prioritized for institutional partnership development rather than conventional liquidity-provider rewards.
Compound V4 introduces a hub-and-spoke architecture designed to centralize capital allocation through a core hub.
This model aims to deliver tighter risk controls and improved capital efficiency that professional counterparties typically require.
The product roadmap also prioritizes native support for real-world assets, enhanced integration tools that enable institutions to embed on-chain lending capabilities into their own platforms, and features that address compliance and technical standards expected by regulated entities.
Protocol representatives note that banks, asset managers, exchanges, and fintech firms increasingly seek to incorporate on-chain lending experiences yet often lack the specialized expertise to construct such infrastructure independently.
Compound positions itself as a ready-made solution built on years of operational history.
More than ten partners have already committed, with discussions underway involving more than twenty additional organizations. Initial institutional-grade products are expected to roll out in the coming weeks.
The initiative reflects a broader industry trend in which DeFi protocols adapt to serve institutional demand for transparent, programmable credit markets while meeting elevated standards for risk management and regulatory alignment.
By combining a sizable, milestone-gated treasury commitment with leadership experienced in both traditional and digital finance, Compound aims to transition from a pioneer of early decentralized lending into a foundational infrastructure layer for the next phase of on-chain finance.
In a major change in leadership, Compound Foundation announced a total leadership overhaul of its management structure. According to the foundation, four executives joined the protocol’s management structure as part of its targeted expansion.
According to the report, Aaron Schnarch will take over as Executive director, and Christopher Donovan as the COO. Furthermore, Leo Eikelman takes over as Chief Tech Officer, while Steven Liu will be the CPO.
These appointments mark the largest leadership shake-up in the crypto industry over the past year. These changes are aimed at making Compound [COMP] a competitive asset.
Compound DAO deploys $52M for DeFi expansion In addition to the leadership shake-up, Compound DAO approved a major development fund of $52 million. The budget allocated $28 million to operations and $24 million to project growth over the next two years.
As per the reports, the $28 million will entail fields such as risk, marketing, and engineering. Moreover, the projects will seek the development of Compound V4. Additionally, $14 million was allocated to the foundation’s multisignature wallet. This major investment comes as Compound attempts to regain market share in the highly competitive lending market.
As such, the foundation hopes that institutional credit could offer a new growth path. With significant funds dedicated to the development of V4, the project wants V4 and institutional products to bridge the gap between DeFi and TradFi. Even more importantly, the investment reflects a broader transformation across the DeFi sector.
How did COMP price react? With the news, COMP made some gains on the price charts, rising to $18 before slightly retracing. With the price hike, the altcoin flipped its 20, and 50-day EMAs, indicating short-term upside momentum.
At press time, Compound was trading around $17.6, up 8.6% on the daily charts. Over the same period, altcoin’s trading volume surged over 648% to $43 million, indicating strong market participation.
Fresh market demand mostly drove the market activity as the Exchange Supply Ratio (ESR) crashed to a three-month low of 0.12.
Source: Cryptoquant Low ESR implies more COMP has flowed out of exchanges. Often, higher outflows strengthen upside momentum, leading to more gains.
In fact, the altcoin’s Relative Strength Index (RSI) has been on a strong upward trajectory, rising to 65. At this level, the indicator suggests that buyers are active.
Source: Tradingview Typically, such a market setup, if sustained, precedes more gains on the price charts. Therefore, if this demand holds, Compound will close above $18 and target $20.
Final Summary Compound announced a total overhaul in leadership structure and approved a $52 million development budget. COMP broke out, surged to $18, then slightly retraced to $17.
PANews reported on August 18 that, according to SoSoValue data, crypto market sectors were mixed, with Bitcoin (BTC) up 1.57%, breaking through $64,000; Ethereum (ETH) up 0.42%, breaking through $1,900. The DeFi sector stood out, rising 1.06% in 24 hours, with Compound (COMP) up 8.92%, Morpho Token (MORPHO) up 5.30%, and Hyperliquid (HYPE) up 1.41%.
In other sectors, the Layer1 sector rose 0.47% in 24 hours, with Zcash (ZEC) up 4.15%; the Layer2 sector rose 0.46%, with Polygon(ex-MATIC) (POL) up 6.29%; the Meme sector rose 0.18%, with PIPPIN (PIPPIN) surging 16.38%; the PayFi sector rose 0.01%, with SafePal (SFP) up 2.45%.
In addition, the CeFi sector fell 0.13%, with OKB down 5.06%; the AI sector fell 3.42%, with Worldcoin (WLD) down 7.54% and Velvet (VELVET) sharply down 43.90%.
Compound Foundation announced a new leadership team and a DAO approved $52 million development program on Aug. 17, targeting institutional credit and real world assets.
Summary
Compound DAO approved a $52 million two year program focused on institutional credit and infrastructure. Only $14 million is available initially, while $38 million remains subject to specific delivery milestones. Aaron Schnarch will lead Compound Foundation alongside executives overseeing operations, products, and core engineering functions. The roadmap includes real world asset support, integration tools, and improved onchain lending capital efficiency. Compound says it has processed roughly $480 billion in deposits and borrowing volume since 2018. Aaron Schnarch, a former Coinbase Custody chief executive, will serve as executive director. Christopher Donovan joins as chief operating officer, Steven Liu as chief product officer and Leo Eikelman as chief technology officer.
Compound described the allocation as the largest development program in the protocol’s history. However, the DAO has not made the entire $52 million immediately available for operating expenses.
The two year program releases $14 million at commencement. A further $38 million will remain in reserve and can only be released after the Foundation meets specified development and institutional adoption milestones.
1/ Compound is entering its next era.
Today we're announcing a new leadership team and a $52M DAO-approved development program,the largest in the protocol's history, to bring institutional credit onchain.https://t.co/gMJMSVg2ZX
— Compound Foundation (@Compound_xyz) August 17, 2026 Compound’s $52 million program uses milestone funding The Compound V4 funding proposal divides the total budget into a $28 million operational program and a $24 million growth and incentives program.
The initial $14 million allocation will finance approximately 12 months of execution. Compound expects to direct 45% to 55% of the operational budget toward engineering and product development. Other funding categories include infrastructure, security, governance, partnerships and administration.
The remaining $38 million will be placed in a separate reserve wallet. A planned Treasury Management Committee will control that wallet through a five of seven multisignature structure. The Foundation will not control the reserve independently.
Under the approved framework, a second $14 million operational payment requires completion of all first year deliverables. Those include a staffed engineering team, a production ready V3 integration kit and a new liquidation engine operating on mainnet.
Compound must also complete V4 core smart contracts to an audit ready standard and launch a limited private alpha. The Treasury Management Committee will review the evidence and either certify or reject the Foundation’s milestone submission.
Institutional adoption controls later payments The $24 million growth program will be divided into three payments. The first $10 million becomes available after the first operational checkpoint.
That payment starts a six month deadline for securing a top tier institutional integration partner. Compound must provide evidence of either a live integration or a formal commitment with a defined deployment plan.
Another $7 million requires the onboarding of a top tier curator to a V4 lending market within 180 days of the previous milestone. The final $7 million becomes available after Compound launches its public V4 testnet.
The committee may stop later transfers if the Foundation misses the conditions. Undeployed funds can also be returned or reassigned following DAO review.
Compound committed to publishing monthly reports, holding community calls and providing more detailed quarterly reviews. Program wallet addresses will be public, allowing governance participants to monitor balances and transfers onchain.
The reserve may earn yield through separately approved treasury strategies while awaiting release. Any forecast concerning that yield remains an estimate rather than guaranteed revenue.
Compound targets banks and tokenized assets Compound plans to add native support for real world assets and tools allowing financial institutions to embed lending services into their products. It also wants to improve capital efficiency and provide infrastructure for banks, asset managers, exchanges and fintech companies.
Schnarch said current DeFi products “fall short of meeting the traditional finance bar,” particularly in compliance and technical requirements. His assessment represents the Foundation’s explanation for the strategic change.
Steven Liu previously worked at Maple Finance, where Compound said he helped scale assets from $500 million to $5 billion. Donovan formerly served as chief operating officer at the Near Foundation. Compound said other team members have experience at Anchorage Digital, HSBC and Broadridge Financial.
The strategy places Compound in direct competition with lending protocols already developing services around tokenized assets. As crypto.news reported, Aave expanded its institutional lending infrastructure onto Avalanche in July.
Institutional collateral is also entering other lending markets. In related coverage, VanEck’s tokenized Treasury fund became available as collateral on Euler lending markets in May.
These projects show rising competition for asset managers seeking blockchain based credit services. They do not guarantee that Compound will secure institutional partners or increase deposits.
Compound faces a smaller position in DeFi lending Compound helped establish algorithmic lending when it launched in 2018. The Foundation says the protocol has processed approximately $480 billion in cumulative deposits and borrowing volume.
It also claims the protocol has recorded “zero bad debt since launch.” The statement is a company claim and differs from total losses or distribution errors, which use separate measurements.
Current deposits remain well below Compound’s 2021 peak. DeFiLlama data showed approximately $1.25 billion in total value locked on Aug. 18, compared with a peak near $12 billion in September 2021.
Ethereum accounted for about $1.14 billion, or almost 92%, of the current total. Compound also had approximately $575 million in active loans.
Aave V3 held about $14.4 billion, while Morpho Blue held roughly $8.1 billion. Those figures placed Compound sixth among lending protocols tracked by DeFiLlama.
The comparison provides context for Compound’s institutional strategy but does not measure revenue, credit quality or capital efficiency. Total value locked can also fluctuate with token prices, withdrawals and borrowing activity.
Compound will release its first product within weeks Compound said the first product from its institutional roadmap will arrive “in the coming weeks.” It did not provide a launch date, product name or confirmed institutional partner.
The next verifiable steps include publication of the program wallets and the first monthly progress report. The Foundation must also provide evidence for each development milestone before the committee authorizes later payments.
The V3 integration kit and liquidation engine are due before the first operational anniversary. Compound must also advance V4 contracts to an audit ready stage and open its private alpha within that period.
No verified market movement could be attributed solely to the leadership announcement. COMP’s price and Compound’s deposits remain exposed to broader cryptocurrency market conditions and activity across competing lending platforms.
Compound Finance has placed a $52 million bet and leadership renewal on its pivot to institutional DeFi. (Miguel Parera/Unsplash)Summary
Compound Finance overhauled its leadership and approved a record $52 million budget as it seeks to revive growth after its total value locked fell to $1.2 billion from a $12 billion peak in 2021.The protocol is pivoting toward institutional clients by developing real-world asset offerings, partner integrations and credit infrastructure designed to meet traditional finance compliance and technical standards.Industry executives say the new leadership team and sizable budget align with a broader shift in DeFi toward serving financial institutions, after the sector’s overall assets declined amid market weakness and security exploits.Compound Finance, one of the oldest decentralized finance (DeFi) lending protocols, replaced its leadership team and approved a $52 million budget on Monday to attract new capital after the value of assets locked on the platform tumbled to $1.2 billion from a peak of $12 billion in September 2021.
The company said it will now focus on attracting institutional users and will offer real-world assets, partner integration and credit infrastructure for traditional financial markets.
Compound pioneered decentralized lending when it started up in 2018, popularizing the concept of earning yield on crypto deposits without intermediaries. It said it has processed roughly $480 billion in deposits and borrowing volume since its inception. Over the past few years, it has lost ground to competitors such as Aave, which holds more than 11 times its TVL with $14.8 billion, DeFiLlama data shows.
As an industry, DeFi is operating from a weakened base. TVL across the sector has fallen by more than a third since the start of the year to roughly $70 billion, driven by a broad correction in the crypto market, compressed yields and a run of protocol exploits, including the $292 million KelpDAO hack in April. Still, the sector is forecast to reach $2.7 trillion by 2030, with tokenized real-world assets (RWAs) among the fastest-growing segments, according to a Standard Chartered projection.
"Now is a great time for initiatives like these, where real capital goes toward both the structural work and the bringing in of bright minds from the institutional sphere who can explain it to a risk committee in their own language,” said Gal Stern, chief business development officer at deBridge, over Telegram. “That combination is what brings institutional confidence back."
The new team includes Chief Operating Officer Christopher Donovan, who previously held the same role at the Near Foundation. Steven Liu, who scaled Maple Finance from $500 million to $5 billion in assets, joins as chief product officer and the former CEO of Coinbase Custody, Aaron Schnarch, becomes an executive director. Other appointees join from Anchorage Digital, HSBC, Broadridge Financial and Maple Finance, the company said.
"DeFi is a remarkable innovation; however, it has achieved limited institutional adoption," Schnarch said in a statement. "Current product offerings fall short of meeting the traditional finance bar, especially as it pertains to compliance and technical requirements."
The move is a logical response to the shift in DeFi's user base, according to Ran Hammer, chief business officer at Orbs.
"Retail participation is a fraction of what it was, and the chain has quietly become a venue for settlement, execution and interaction between financial institutions," Hammer said. “Since DeFi summer, the space has turned into something completely different, essentially a new financial layer for institutions. So bringing in leadership that speaks that language is exactly the right direction."
The size of the allocated budget, the largest approved by Compound's decentralized autonomous organization (DAO), may help underline its commitment.
"The $52 million and a bench with that much institutional experience is a serious move, and it should improve its execution," said Himanshu Sahay, co-founder and chief technology officer of crypto lending firm Arch Lending, but institutions will want more than credentials. They "aren't underwriting teams, they’re underwriting structures."
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Compound, the protocol that helped invent DeFi lending back when “yield farming” was still a novel concept, is making its biggest strategic pivot in years. A $52 million, two-year funding proposal is heading to the Compound DAO with a clear thesis: the future of the protocol runs through institutional finance, not retail incentives.
Of that total, $14 million has already been greenlit for immediate deployment. The rest will unlock in tranches tied to specific milestones, a structure that essentially puts the development team on a performance plan funded by the protocol’s own treasury.
What the money buys The $52 million splits into two buckets. Roughly $28 million goes toward operations, covering the engineering and product teams needed to build Compound V4. The remaining $24 million is earmarked for growth and incentives, though “incentives” here carries a different meaning than it used to.
Rather than spraying tokens at liquidity providers and hoping the TVL number goes up, Compound is directing between $8 million and $10 million, representing 35% to 45% of the growth allocation, specifically toward institutional partnerships. Think onboarding compliance-minded financial firms, not subsidizing anonymous whale farmers.
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The architectural centerpiece of V4 is a hub-and-spoke system for liquidity management. In plain terms, instead of siloed lending markets that each need their own pool of capital, the new design routes liquidity through a central hub that can allocate it across multiple spokes. The result is better capital efficiency and more granular risk management for the kind of counterparties who have compliance departments and legal counsel.
Year-one milestones include assembling a full product and engineering team, shipping upgrades to the existing V3, and delivering a private alpha of V4. That staffing requirement isn’t just a nice-to-have. It’s a gate: the full funding allocation won’t release until the team is in place.
The institutional pipeline Compound claims more than 10 high-profile partners are already committed, with over 20 additional institutions in active discussions. The protocol is betting that the DeFi market’s next growth phase won’t come from retail traders chasing triple-digit APYs but from professional capital looking for programmable, transparent lending infrastructure that can satisfy regulatory requirements.
Compound’s bet is that it can reclaim relevance in this race. The protocol was once the undisputed leader in decentralized lending, pioneering the concept of algorithmic interest rates and governance tokens with COMP. But it gradually lost ground to Aave, which expanded more aggressively across chains and asset types.
The V4 proposal reads as an acknowledgment that competing on incentives alone wasn’t working. Pouring tokens into liquidity mining programs became a treadmill: impressive numbers while the rewards lasted, deflating metrics once they stopped.
Why this matters beyond Compound For the DAO governance model, this proposal is an interesting stress test. Asking a decentralized community to approve $52 million in spending, with clear accountability structures and performance gates, is more sophisticated than the typical “should we adjust this fee parameter” governance vote.
The risk, of course, is execution. Compound needs to hire the right team, ship working software, and convert those 20-plus institutional conversations into actual integrations, all while its DAO maintains the conviction to keep releasing funds at each milestone. The tranche structure provides some protection against a team that takes the money and underdelivers, but it also means development could stall if any single milestone proves harder than expected.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
Coinbase Derivatives launches US500 perpetual contract, which tracks the 500 largest securities in the United States.
According to an official announcement, Coinbase Derivatives has launched the US500 perpetual contract. Trading hours are 8:00 PM ET on Sundays to 5:00 PM ET on Fridays, with the market closed on trading holidays. The US500 Index perpetual futures contract is a cash-settled 5-year futures contract that supports round-the-clock trading, allowing traders to manage risk, conduct margin trading, or speculate on the price of the MarketVector Top 500 US Profitable Companies Index (MVUS5P). The contract uses a funding rate mechanism to keep futures prices closely aligned with the index price, and it is tradable on Coinbase Derivatives Exchanges (CDE).
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The US and Iran remain in a stalemate, the three major U.S. stock indexes closed lower, and Bitcoin posted a minor gain.
International oil prices rose roughly 3% to close on Monday amid dim prospects for U.S.-Iran peace talks. Trump stated he has no intention of extending the upcoming expiring agreement with Iran. The U.S.-Iran memorandum of understanding signed in June this year technically expired on Monday. The two sides still have differences on multiple issues including the Strait of Hormuz. Other officials hinted that the U.S. is not in a hurry to end the nearly six-month conflict. U.S. Energy Secretary said the U.S. is engaged in a long-term game with the Islamic Republic of Iran, while Trump senior advisor Kushner noted that Trump will remain patient in reaching an agreement. Per market data from BIT (bit.com), U.S. stocks closed on Monday: the Dow Jones Industrial Average fell 0.5%, the S&P 500 dropped 0.5%, and the Nasdaq declined 0.32%. SK Hynix (SKHY.O) rose 3%, Micron Technology (MU.O) gained 4%, SanDisk (SNDK.O) jumped 8.8%, and Nike (NKE.N) fell 4%. According to HTX market data, Bitcoin is currently trading at $64,288, with a 2.13% gain in the past 24 hours.
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Anthropic's annual revenue exceeds $65 billion ahead of its IPO.
According to people familiar with the matter, Anthropic’s current performance indicates its annual revenue is on track to exceed $65 billion, more than seven times the level at the end of last year. The sources added that as of the end of July, Anthropic’s annual recurring revenue (ARR) had reached $65 billion, with one source noting the company shared the figure during regular investor updates. The sharp revenue acceleration has further strengthened Anthropic’s confidence in advancing its initial public offering (IPO) plans. Both Anthropic and OpenAI have confidentially filed IPO-related documents, and Anthropic is expected to list on Wall Street as early as this fall, possibly earlier than OpenAI.
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A dormant 15-year crypto address has transferred 8.54 BTC to Kraken, generating an unrealized profit of 4,600 times.
According to monitoring by Onchain Lens, a Bitcoin wallet dormant for 15 years has transferred 8.54 BTC (valued at approximately $539,000) to crypto exchange Kraken. The wallet initially received the Bitcoin across multiple addresses back when BTC traded at roughly $14. Calculated at current prices, the 8.54 BTC holding has surged around 4,600 times in value from its original purchase cost.
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Trump: The United States does not seek to extend the memorandum of understanding with Iran.
US President Donald Trump has stated that the United States is not currently seeking to extend its memorandum of understanding (MOU) with Iran. Trump noted that Iran wants to reach an agreement but will not accept what he views as the "necessary" terms of such a deal. He also reiterated his earlier proposal to declare the Strait of Hormuz as US territory, and reaffirmed America’s control over the strategic waterway. Trump further claimed that the Strait of Hormuz remains open, and oil prices are trending lower.
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Sources: The Pentagon acknowledges that existing military plans cannot ensure the Strait of Hormuz remains unimpeded.
According to a report by Iran’s Press TV, a regional intelligence source revealed that the Pentagon (U.S. Department of Defense) has concluded that none of the existing military plans can guarantee the safe passage of vessels through the Strait of Hormuz or ensure stable energy supplies in the region. The official noted that this assessment exposes a strategic deadlock Washington faces in the Persian Gulf, with the situation being extremely severe. The source stated: "The Pentagon’s assessment is that currently no military plan has sufficient political and security capabilities to keep the Strait of Hormuz open, ensure the safe passage of vessels, and maintain energy stability." This is a major setback for U.S. military planners, who have long regarded the Strait of Hormuz as a vital chokepoint requiring a continuous naval presence. The U.S.’s inability to control this strategic waterway has severely undermined Washington’s strategic posture in the region and exposed the limitations of U.S. military power when facing Iran’s growing asymmetric warfare capabilities.
The DAO approved the two-year budget in May with 1.88 million COMP in favor and none against. Compound holds about $1.2 billion in deposits, against Aave's $14.8 billion.
Compound Foundation named four executives recruited from Coinbase Custody, Anchorage Digital, the NEAR Foundation and Maple Finance to spend a $52 million budget on turning the 2018 lending protocol into credit infrastructure for banks and asset managers.
The hires arrive with Compound at roughly a twelfth of Aave's size. Compound V3 and V2 hold about $1.23 billion in deposits combined, according to DefiLlama, against $14.8 billion at Aave and $8.06 billion at Morpho Blue. What the Foundation is selling institutions is operating history: running since 2018, the most forked codebase in DeFi, and, by the Foundation's account, zero bad debt since launch. That last record held through November 2025, when Compound paused withdrawals in three stablecoin markets on risk manager Gauntlet's recommendation to head off bad debt as Elixir's deUSD collapsed.
$38 Million Behind MilestonesCOMP holders approved the money in Proposal 582, which executed on May 10 with 1.88 million COMP in favor and nothing against or abstaining. Turnout ran more than double the 600,000 to 850,000 COMP that routine risk-parameter votes drew over the same period.
The funding proposal splits $52 million across two years: $28 million for operations, including engineering, integrations, risk and marketing, and $24 million for growth, including institutional onboarding, market seeding and curator expansion. Only $14 million went to the Foundation's own multisig. The remaining $38 million sits in a Program Reserve controlled by a 5-of-7 Treasury Management Committee multisig, released against milestones: a staffed engineering team and a production V3 integration kit for the first tranche, a tier-one curator onboarding for the second, a public V4 testnet for the third. Undeployed budget earns yield for the DAO until certification.
The DAO created that committee in Proposal 580, executed two minutes later, pulling roughly $18.95 million in V2 reserves and $6.94 million in V3 surplus reserves into treasury escrow alongside about $32 million already sitting in Aera and Avantgarde vaults.
"DeFi is a remarkable innovation, however, it has achieved limited institutional adoption," said Aaron Schnarch, the Foundation's new Executive Director, in a statement. "We know the demand is there, but current product offerings fall short of meeting the traditional finance bar, especially as it pertains to compliance and technical requirements."
Nine Of Eleven ETFsSchnarch was most recently COO of Anchorage Digital and before that CEO of Coinbase Custody. The Foundation credits him with securing 11 of 12 U.S. bitcoin ETF custody mandates. Coinbase said in July 2024 that it was "custodian powering 9 of 11 spot bitcoin ETFs," having started as custodian for eight of the funds that began trading in January 2024. At Anchorage, Schnarch oversaw the bank's role in the Global Dollar Network, the Paxos-led USDG consortium launched in November 2024 with Robinhood, Kraken, Galaxy Digital, Bullish and Nuvei.
The other three appointments:
Christopher Donovan, COO. Former COO and General Counsel of the NEAR Foundation, where he helped launch NEAR Intents, the cross-chain liquidity protocol the Foundation says has cleared more than $20 billion in volume. Previously a partner at Outlier Ventures.Steven Liu, Chief Product Officer. Former Head of Product at Maple Finance, which the Foundation says he scaled from $500 million to $5 billion in assets under management. Maple currently holds about $2.42 billion in TVL, per DefiLlama. Earlier roles at Anchorage Digital, Amazon and HSBC.Leo Eikelman, CTO. More than four years in engineering leadership at Coinbase Institutional, where he led development of Prime Onchain Wallet. Earlier roles at Amazon and InvestorCOM.The Foundation told delegates in its June program update that it had appointed a CTO from "tier-one digital asset and big-tech companies," hired two protocol engineers and added a non-executive director, without naming them at the time.
Permissioned Vaults, Tokenized EquitiesWhat the $52 million builds is set out in the Foundation's V4 roadmap, published in January: an integration suite letting brokerages and fintechs embed Compound lending, tokenized equities accepted as collateral against stablecoin borrowing, permissioned vaults with KYC and AML controls, portfolio-aware risk management with dynamic loan-to-value calibration, and a third-party risk manager with authority to reallocate liquidity in real time.
Some of it lands before V4. The July update put the V3 integration kit at development complete, the Institutional Comet in launch testing and a new liquidation engine in controlled testing. The Foundation launched its own front end at compound.xyz on June 29, where a Compound Institutional Market is now taking early-access signups. The Foundation says the first institutional product ships within weeks.
Compound is arriving after its two larger competitors. Aave Labs launched Horizon for institutions borrowing stablecoins against tokenized assets, and Morpho raised $175 million to expand curated lending.
Ninety-Eight Percent Below PeakCompound's own site puts cumulative deposits and loans at about $480 billion and all-time loans at $57 billion. Current activity is smaller: V3 generated about $1.77 million in fees over the past 30 days and $29.1 million over the past year, per DefiLlama.
TVL peaked above $12 billion in November 2021 and fell to about $1.4 billion by February 2026, when The Defiant examined the decline. Founder Robert Leshner left in June 2023. Proposal 62 shipped a bug in October 2021 that over-distributed COMP rewards, costing the DAO tens of millions of dollars. In July 2024, Compound offered COMP stakers 30% of protocol reserves to defuse what delegates called a governance attack by the whale known as Humpy, who had pushed through a vote to move roughly $24 million of treasury COMP into a vault his associates controlled.
COMP traded near $16.26 on Monday, up less than 1% over 24 hours, per CoinGecko, for a market cap around $163 million. The token sits about 98% below its May 2021 high of $854.45.
Delegates Want Spend DataDelegates have started pressing for numbers the Foundation has not yet published. In the June thread, Tane asked for capital deployment broken out by operational category "as originally committed in the funding proposal," Curia questioned how an R&D Comet initiative fits Year 1 milestones, and DAOplomats proposed a standard monthly template covering milestone delivery, hiring and spend-to-date. The Foundation agreed to include aggregated deployment data going forward. Neither the June nor July update disclosed spending.
Before the vote, delegate compw1n challenged the growth plan's curator selection, arguing performance data favored Steakhouse Finance and Sentora over Gauntlet, whose role in Compound governance delegates have contested before. No delegate voted against the budget.
While Bitcoin continues to move within a narrow range, cryptocurrency analytics company Santiment highlighted three altcoins in a recent post.
At this point, Santiment noted that investor interest in the cryptocurrency market was shifting towards certain altcoins.
According to Santiment data, the number of active addresses on Compound (COMP), Cronos (CRO), and Rollbit (RLB) networks has reached its highest levels in recent months.
According to Santiment, the fact that all three networks have reached activity levels not seen since at least spring indicates a significant increase in user and wallet activity within the respective altcoin ecosystems.
According to Santiment data, the number of active addresses on Compound has reached 1,400, on Cronos 521, and on Rollbit 120.
According to the data, Compound showed the highest on-chain activity among the three projects. This is attributed to renewed integration efforts within Compound. It is believed that the increase in activity on the COMP side stems not only from speculative transactions but also from technical and governance improvements surrounding the protocol.
According to Santiment, the increase in the number of active addresses on the Cronos (CRO) network is directly driven by developments that support network usage. Santiment cites the momentum in the Cronos App, along with plans for native USDC and EURC, CCTP support, and increased visibility on Dune, as developments that could re-engage network users.
Finally, Santiment assesses that the activity on the RLB side, unlike the other two projects, is largely linked to token economics and supply mechanics.
According to Santiment, while the common thread in the increase in activity across Compound, Cronos, and Rollbit is a significant rise in on-chain mobility, the catalyst appears to be different for each network.
In conclusion, Compound stands out with its integration and governance, Cronos with its ecosystem-supporting developments, and Rollbit with its supply reduction mechanism. Data shows that currently, altcoins COMP, CRO, and RLB are facing renewed user interest in the market. However, an increase in the number of active addresses alone does not necessarily mean that the token price will rise.
*This is not investment advice.
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In the summer of 2020, a governance token called COMP turned decentralized finance inside out. Compound, a lending protocol on Ethereum, began distributing COMP tokens to anyone who lent or borrowed on the platform, and within weeks, hundreds of millions of dollars flowed into smart contracts that had held a fraction of that the month before. Users were not just earning interest on deposits; they were earning a second layer of rewards, governance tokens, on top of the base yield, and then depositing those tokens elsewhere to earn a third layer. The practice acquired a name, yield farming, and for a brief, fevered period, annual returns exceeded 1,000% on major platforms. The rates were unsustainable, the risks were poorly understood, and the strategies were genuinely novel. Three years later, the fever broke, the unsustainable yields collapsed, and what remained was a permanent feature of the DeFi economy: the practice of actively deploying capital across protocols to maximize returns. Yield farming did not disappear after DeFi Summer. It grew up.
Summary
Yield farming is the practice of depositing cryptocurrency into DeFi protocols to earn returns from trading fees, lending interest, governance token rewards, or protocol incentive programs. The strategy encompasses multiple categories: liquidity provision on decentralized exchanges, lending on money markets, automated vault strategies, and points-based programs that convert to future token allocations. Sustainable yields in DeFi typically range from 3-15% for stable pairs and 10-30% for volatile pairs, with higher advertised rates usually reflecting temporary subsidies, token inflation, or risks that are not priced into the headline number. The term “farming” is borrowed from gaming culture, where players repeat actions to accumulate resources. In DeFi, the resource is yield, and the repeated action is depositing capital wherever the return is highest. The analogy extends further than most people realize: farming in games is tedious, repetitive, and rewards those who optimize ruthlessly. DeFi yield farming is the same. The casual farmer deposits stablecoins into Aave and earns 4%. The professional farmer splits capital across eight protocols on four chains, compounds rewards hourly through automated strategies, hedges impermanent loss with options positions, and earns 12-20% while monitoring smart contract risk across every position. The difference between the casual and professional farmer is not just in returns; it is in the understanding of where yield comes from, because yield that appears to come from nowhere always comes from somewhere, and the farmer who does not know the source is usually the source.
The mechanics: what happens when you deposit Yield farming, stripped to its simplest form, involves three steps: you deposit tokens into a smart contract, the protocol uses your tokens for some productive purpose, and you receive a share of the value that purpose generates. The productive purposes vary by protocol type, but they fall into a small number of categories.
On a decentralized exchange like Uniswap or Curve, the productive purpose is market-making. You deposit a pair of tokens, say ETH and USDC, into a liquidity pool, and the DEX uses your tokens to facilitate trades between those assets. Every time a trader swaps ETH for USDC or vice versa, they pay a fee (typically 0.3% on Uniswap v2, variable on v3), and that fee is distributed proportionally among all liquidity providers in the pool. Your return depends on the volume of trades flowing through the pool relative to its total size: a pool with $10 million in deposits and $1 million in daily trading volume generates a different return profile than one with $10 million in deposits and $100,000 in daily volume. The yield is real, it comes from fees paid by real traders, but it is not free: providing liquidity exposes you to impermanent loss, a cost that can exceed the fees earned if the price ratio of your deposited tokens changes significantly.
On a lending protocol like Aave, Compound, or Morpho, the productive purpose is credit intermediation. You deposit tokens, the protocol lends them to borrowers who pay interest, and you receive a share of that interest. Borrowers must overcollateralize their loans (deposit more value than they borrow), which protects lenders from default risk at the protocol level, though smart contract risk remains. Lending yields fluctuate with demand: when lots of people want to borrow USDC (often to lever up during bull markets), the interest rate rises; when borrowing demand drops, yields compress. Stablecoin lending rates have ranged from below 1% to above 15% in recent years, driven almost entirely by the market cycle.
On a yield aggregator like Yearn Finance, Beefy, or Sommelier, the productive purpose is strategy execution. You deposit tokens into a vault, and the vault’s smart contract automatically executes a farming strategy: depositing into lending protocols, providing liquidity, claiming reward tokens, swapping them for the base asset, and redepositing. The vault automates the compounding and rebalancing that a manual farmer would need to do themselves, charging a performance fee (typically 10-20% of profits) in exchange. Vaults are the passive farmer’s tool: they abstract away the complexity of multi-protocol strategies and reduce gas costs by batching operations across all depositors. The tradeoff is opacity, you are trusting the vault’s strategy and its smart contract code, and a layered risk: the vault contract can fail, the underlying protocol contracts can fail, and the strategy itself can underperform if market conditions change faster than the vault rebalances.
The taxonomy: types of yield farming The yield farming landscape has diversified into several distinct categories, each with different return profiles and risk characteristics.
Liquidity provision farming is the oldest and most straightforward form. You deposit token pairs into DEX pools and earn trading fees. On concentrated liquidity DEXs like Uniswap v3, you can specify a price range for your liquidity, concentrating your capital where trading activity is highest and earning more fees per dollar deployed. The tradeoff is that concentrated liquidity amplifies impermanent loss when prices move outside your range, and managing positions actively requires constant attention or automated position managers.
Incentivized farming adds a second yield layer. Protocols distribute their own governance tokens to liquidity providers as a subsidy to attract deposits. During DeFi Summer 2020, COMP, SUSHI, and dozens of other tokens were distributed this way, producing triple-digit APYs that attracted billions in capital. The incentive model has evolved: modern incentive programs tend to be more targeted (rewarding specific pools or behaviors) and time-limited (vesting schedules, lock-ups, or decreasing emission rates). The fundamental dynamic has not changed: incentivized yields are subsidized by token inflation, and the sustainability of the return depends entirely on whether the token’s price holds while emissions dilute the supply.
Lending farming is lower-risk and lower-return. Depositing stablecoins into Aave or Compound earns a base interest rate from borrower payments. Some lending protocols add governance token incentives on top, creating a total yield that exceeds the base rate. The appeal is simplicity and the absence of impermanent loss: your deposit stays in the asset you deposited, and your return is denominated in the same asset. The risk is primarily smart contract exposure and, for non-stablecoin deposits, the underlying token’s price volatility.
Points farming emerged in 2024-2025 as a new incentive model. Instead of distributing tokens directly, protocols award off-chain “points” for depositing capital or using the product. Points are expected to convert to governance tokens at a future token generation event, but the conversion ratio is unknown until that event occurs. EigenLayer’s restaking points, Blast’s ecosystem points, Ethena’s shard system, and Hyperliquid’s points program all used this model. Points farming introduces a unique risk: you are earning a claim on a future asset whose value, issuance, and distribution rules are all unknown. The speculative element is explicit, and the returns are entirely dependent on the eventual token’s price and your share of the total point supply.
Recursive or leveraged farming amplifies returns and risks. A farmer deposits collateral into a lending protocol, borrows against it, deposits the borrowed tokens into another protocol (or the same one), and repeats. Each loop earns an additional layer of yield but also increases the farmer’s exposure to liquidation risk: if any of the underlying assets drops in price, the chain of positions can unwind in a cascade of forced sales. Leveraged farming was responsible for some of the most spectacular blowups in DeFi’s history, and it remains a strategy reserved for operators who understand exactly what they are leveraging and what triggers their liquidation.
The math that lies: APY, APR, and what the numbers actually mean Yield farming returns are universally quoted as APY or APR, and both numbers lie, though in different ways.
APR, annual percentage rate, is the simple interest rate without compounding. If a pool earns 1% per month on deposits, its APR is 12%. The number is honest about what the rate has been but says nothing about what it will be: APR is backward-looking, a measurement of recent performance extrapolated to a year, and DeFi rates change daily or hourly based on capital flows and demand. A pool showing 50% APR when you check it may show 5% APR a week later because $100 million in new deposits arrived and diluted the yield.
APY, annual percentage yield, includes the effect of compounding. The same 1% per month, compounded, produces an APY of 12.68%. In DeFi, the compounding frequency varies: some vaults compound daily, others weekly, and the difference in APY can be significant for high-yield positions. The number is useful for comparing strategies with different compounding frequencies but adds a layer of abstraction that can obscure the underlying rate.
Both metrics share a critical flaw when applied to incentivized farming: they value the reward tokens at their current price. A pool showing 200% APY in governance token rewards assumes the governance token maintains its current price for the entire year. If the token drops 80%, which is not unusual for newly-launched DeFi tokens, the real APY is 40%, and if everyone who farmed the token sells their rewards simultaneously (which is what typically happens), the selling pressure itself drives the price down, creating a reflexive loop where the advertised yield self-destructs.
The honest way to evaluate yield farming returns is to decompose the yield into its sources and assess the sustainability of each. Fee-based yield from trading volume is sustainable as long as the trading volume persists. Interest from lending is sustainable as long as borrowing demand exists. Governance token incentives are sustainable only if the token’s price absorbs the emission schedule without collapsing. Points-based yields are entirely speculative until the token launches. Any headline APY above 15-20% for stablecoin strategies or 30-50% for volatile pair strategies should be treated with skepticism and decomposed into its sources before capital is committed.
Impermanent loss: the cost the headline yield hides Impermanent loss is the single most important concept in yield farming, and it is the one most farmers understand least well. It occurs whenever you provide liquidity to a constant-product AMM (like Uniswap) and the price ratio of your deposited tokens changes relative to when you deposited them.
The mechanism is mathematical and unavoidable. A constant-product AMM maintains the invariant x * y = k, where x and y are the quantities of the two tokens in the pool and k is a constant. When an external price change occurs, arbitrageurs trade against the pool to bring its internal price in line with the market price, and this rebalancing changes the composition of your position. If you deposited 50% ETH and 50% USDC and ETH doubles in price, arbitrageurs will buy ETH from the pool (cheap relative to the market) and sell USDC into it, leaving the pool with less ETH and more USDC. Your position is now worth less than if you had simply held the original tokens in your wallet.
The magnitude depends on the price change. A 1.25x price move produces approximately 0.6% impermanent loss. A 2x move produces 5.7%. A 5x move produces 25.5%. For concentrated liquidity positions, where capital is allocated to a narrow price range, the impermanent loss is amplified proportionally to the concentration factor, creating a tradeoff between higher fee earnings and higher impermanent loss exposure.
The term “impermanent” is misleading. The loss is impermanent only in the sense that it reverses if the price ratio returns to its original value. In practice, prices rarely return to exactly where they were, and for trending assets, the loss is permanent and growing. For stablecoin-stablecoin pairs (USDC/USDT), impermanent loss is negligible because both tokens track the same price. For volatile pairs (ETH/MEME, SOL/bonk), impermanent loss can easily exceed the trading fees earned, producing a net loss despite a seemingly positive APY.
The practical implication: impermanent loss must be subtracted from the headline yield to determine the real return. A pool showing 30% APY in trading fees but experiencing 15% impermanent loss is actually yielding 15%. A pool showing 10% APY with 12% impermanent loss is losing money. Tools like APY.vision, Revert.finance, and DeBank allow farmers to track their actual P&L including impermanent loss, and anyone providing liquidity without tracking this number is flying blind.
The risk stack: what can go wrong, ranked by frequency Yield farming risks form a hierarchy, and the most common risks are not the ones that make headlines.
Token price decline is the most frequent source of loss. If you farm with volatile tokens and the token price drops 40%, your 15% APY is irrelevant: you lost money. This is not a DeFi-specific risk but a market risk that yield farming amplifies because it encourages deploying capital into the highest-yield (often the highest-volatility) opportunities.
Impermanent loss, as described above, is the second most common source of loss for liquidity providers. It is predictable, measurable, and almost universally underestimated.
Smart contract exploits are the most consequential risk. DeFi protocols are code, and code has bugs. In 2024, over $1.7 billion was stolen from DeFi protocols through smart contract exploits, oracle manipulation, and governance attacks. Your deposited funds are held in smart contracts that can be exploited, and the composability of DeFi, where one protocol deposits into another which deposits into a third, creates cascading risk: a bug in a downstream protocol can affect every protocol built on top of it. Audits reduce but do not eliminate this risk; some of the largest exploits have targeted audited code.
Rug pulls and protocol abandonment are distinct from exploits. In smaller, newer protocols, the development team may drain the protocol’s funds and disappear, or simply stop maintaining the code and let the protocol decay. Rug pulls are less common on major, established protocols but remain a significant risk in the long tail of DeFi, particularly on newer chains where the protocol ecosystem is less mature.
Liquidation risk applies to leveraged farming strategies. If you borrow against your deposits and the collateral value drops, the protocol liquidates your position, selling your collateral to repay the loan, often at a significant loss. During sharp market downturns, cascading liquidations create forced selling that amplifies the crash, and leveraged farmers are the first casualties.
Regulatory risk is the slowest-moving but potentially the most disruptive. Centralized yield products, Celsius, BlockFi, Gemini Earn, were shut down or restructured under SEC enforcement. Pure DeFi yield farming, interacting directly with permissionless smart contracts, has not been directly targeted, but the regulatory boundary between “decentralized” and “centralized” is legally ambiguous, and the DeFi frontends that most users interact with are operated by companies subject to jurisdiction.
The Curve Wars and the economics of liquidity incentives No discussion of yield farming is complete without the episode that revealed the mechanism’s deepest dynamics: the Curve Wars.
Curve Finance, a DEX optimized for stablecoin and similar-asset swaps, introduced a system where CRV token holders who locked their tokens for up to four years (receiving vote-escrowed CRV, or veCRV) could direct the protocol’s token emissions to specific liquidity pools. Pools receiving more emissions attracted more liquidity providers, which deepened liquidity, which improved trading execution, which attracted more volume, which generated more fees. The right to direct CRV emissions became, in effect, the right to attract liquidity, and protocols whose stablecoins or tokens needed deep Curve pools began competing for that right.
The competition took the form of bribes: protocols paid veCRV holders to vote for their preferred pools. Convex Finance emerged as the dominant intermediary, aggregating CRV deposits and voting power and selling governance votes to the highest bidder. At the peak of the Curve Wars, protocols were paying $1.50-2.00 in bribes per $1 of CRV emissions directed to their pools, a ratio that only made sense because the liquidity those emissions attracted was worth more to the protocol than the bribe cost.
The Curve Wars revealed a fundamental truth about yield farming economics: liquidity is a commodity that goes to the highest bidder, and yield farming returns are, in the long run, determined by the cost protocols are willing to pay to rent that liquidity. When protocols pay high incentives, yields are high. When they stop paying, yields collapse and capital migrates elsewhere. The farmer who understands this dynamic, that they are selling a service (liquidity) to protocols willing to rent it, has a fundamentally clearer view of their position than the farmer who believes high yields are a natural property of DeFi.
Yield farming and US taxes: the compliance reality US tax treatment of yield farming is complex, largely ungoverned by specific guidance, and imposes significant record-keeping burdens on active farmers.
Every yield farming reward is a taxable event. The IRS treats tokens received as farming rewards, whether from trading fees, lending interest, governance token distributions, or vault profits, as ordinary income at fair market value when received. If you claim 100 COMP tokens worth $50 each, you owe income tax on $5,000, regardless of whether you sell the tokens. If you later sell those tokens at $80 each, you owe capital gains tax on the $3,000 gain ($30 per token times 100 tokens). If you sell at $20 each, you have a $3,000 capital loss that can offset other gains.
Compounding creates a tax nightmare. Vaults that auto-compound, selling reward tokens and redepositing the proceeds, generate a taxable event at every compound cycle. A vault that compounds daily creates 365 taxable events per year, each requiring the fair market value of the tokens at the moment of compounding. No DeFi protocol issues 1099 forms. The burden of tracking every event falls entirely on the farmer.
Impermanent loss has no clear tax treatment. The IRS has not addressed whether impermanent loss constitutes a realized loss (deductible against income) or an unrealized loss (not deductible until the LP position is closed). Most tax advisors treat impermanent loss as realized only upon withdrawal of the LP position, but the treatment is not settled.
Token swaps within a strategy are taxable. If a vault sells governance tokens for stablecoins as part of its compounding strategy, each swap is a taxable disposition. Multi-hop strategies that involve three or four token swaps per cycle generate taxable events at each hop.
The practical advice for US yield farmers: use a crypto tax tracking platform (Koinly, CoinTracker, TokenTax, ZenLedger) from day one. Retroactive tracking across multiple chains, protocols, and wallet addresses is exponentially harder than real-time tracking. Budget for tax compliance as a cost of farming, because the marginal gains of active yield farming can be significantly reduced by the tax and accounting costs of documenting them.
How to start: a practical path for beginners If you want to explore yield farming, a progressive approach minimizes your risk while building your understanding.
Begin with stablecoin lending. Deposit USDC or USDT into Aave on Ethereum mainnet or Arbitrum. The yield is modest, currently 3-8% depending on market conditions, but the risk profile is the simplest in DeFi: no impermanent loss, single-asset exposure, and Aave is one of the most audited and battle-tested protocols in the ecosystem. This step teaches you the mechanics of connecting a wallet, approving transactions, depositing, and monitoring a position.
Graduate to stablecoin LP positions. Providing USDC/USDT liquidity on Curve earns trading fees from stablecoin swaps with minimal impermanent loss (both tokens track the dollar). The yield is typically higher than pure lending, and the experience teaches you how LP positions work, how to read pool statistics, and how to claim and compound rewards.
Explore yield aggregator vaults. Depositing into a Yearn or Beefy vault automates the compounding process and exposes you to the vault’s strategy, which may span multiple protocols. Read the vault’s strategy description, understand what protocols it deposits into, and check the TVL and age of the vault (older, larger vaults have been more heavily tested).
Only after you are comfortable with these steps should you consider volatile pair liquidity provision, concentrated liquidity positions, or leveraged strategies. Each step up the complexity ladder adds risk, and the most common yield farming losses come from farmers who jumped to advanced strategies before understanding the basics.
Regardless of strategy, follow these operational principles: use established protocols with multiple audits and significant TVL. Deploy capital you can afford to lose. Monitor your positions regularly. Use hardware wallets for large deposits. Diversify across multiple protocols and chains. Track your taxes from day one. And remember the fundamental question: if you do not know where the yield comes from, you are the yield.
Frequently asked questions Is yield farming still profitable in 2026? Yes, but the character of profitability has changed. The triple-digit APYs of DeFi Summer 2020 are gone for mainstream protocols. Sustainable yields on stablecoin deposits range from 3-10%. Volatile pair liquidity provision yields 10-30% but carries impermanent loss risk. Points farming and early-protocol incentives can produce higher short-term returns but with significant uncertainty. Professional yield farmers earn competitive returns through active management across multiple protocols and chains, but casual farming with set-and-forget deposits produces modest, savings-account-level yields on stablecoins.
What is the difference between yield farming and staking? Staking secures a proof-of-stake blockchain network and earns validator rewards. Yield farming provides liquidity, lending capital, or strategic deposits to DeFi protocols and earns trading fees, interest, or incentive tokens. The risk profiles differ: staking risk is primarily slashing and lock-up periods; yield farming risk includes impermanent loss, smart contract exploits, token price collapse, and liquidation (for leveraged strategies). Some activities blur the line: depositing liquid staking tokens like stETH into a DeFi lending protocol combines both staking and yield farming in a single position.
Can you yield farm with Bitcoin? Not directly on Bitcoin’s blockchain, which does not natively support the smart contracts required for DeFi protocols. However, wrapped Bitcoin (WBTC on Ethereum, tBTC via Threshold Network) can be deposited into Ethereum DeFi protocols for yield farming. Some Bitcoin layer-2 networks and sidechains are building native DeFi capabilities, but the ecosystem is much smaller and less battle-tested than Ethereum’s. The wrapping process itself introduces risk: your BTC is held by a custodian or smart contract that issues the wrapped token, and that intermediary is a single point of failure.
What is the safest yield farming strategy? Lending stablecoins (USDC, USDT, DAI) on established, multi-year, multiply-audited lending protocols (Aave, Compound, Morpho) on Ethereum mainnet or major layer-2 networks. This strategy eliminates impermanent loss, minimizes token price risk, and uses the most heavily-tested smart contracts in DeFi. The yield is modest, typically 3-8% APR, but the risk-reward profile is the most conservative available in decentralized finance. Even this strategy carries non-zero smart contract risk and stablecoin depeg risk, but both are well-understood and historically rare on established platforms.
How much money do you need to start yield farming? The answer depends entirely on which blockchain you use. On Ethereum mainnet, gas costs for depositing, claiming rewards, and withdrawing can run $50-200 per transaction, making yield farming impractical with less than $5,000-10,000 in capital. On layer-2 networks like Arbitrum, Base, or Optimism, gas costs are typically under $1, allowing meaningful farming with $500-1,000. On Solana, transaction costs are fractions of a cent, and farming is accessible with even smaller amounts. The minimum is set by gas economics, not by protocol requirements: most protocols have no minimum deposit, but if your gas costs exceed your expected yield, the position is economically irrational.
Disclaimer: This article is for informational purposes only and should not be considered financial or investment advice.
Güney Kore’nin en büyük kripto para borsalarından Upbit, yeni bir altcoin listelemesini daha duyurdu. Borsa tarafından yapılan resmi açıklamaya göre Morpho (MORPHO), 25 Temmuz itibarıyla Kore Wonu (KRW) işlem çiftiyle alım satıma açılacak. Güney Kore pazarına doğrudan erişim sağlayacak bu listelemenin, MORPHO’nun likiditesini artırması ve daha geniş bir yatırımcı kitlesine ulaşmasına katkı sağlaması bekleniyor. Duyurunun ardından tokene yönelik ilgi hızla artarken, yatırımcılar hem işlem hacmindeki değişimi hem de fiyat hareketlerini yakından takip etmeye başladı.
Upbit, MORPHO’yu KRW Pazarında Listeleyecek Upbit’in yayımladığı duyuruya göre MORPHO, 25 Temmuz saat 12.00 (TSI) itibarıyla KRW işlem çifti ile alım satıma açılacak. Güney Kore merkezli borsa, yeni listelemelerde olduğu gibi MORPHO için de belirli güvenlik prosedürlerinin uygulanacağını ve işlemlerin ağ doğrulamalarının tamamlanmasının ardından başlayacağını belirtti. Upbit’te gerçekleştirilen listelemeler, platformun yüksek işlem hacmi nedeniyle çoğu zaman ilgili altcoinlerde volatilitenin artmasına neden olabiliyor.
Morpho Nedir? Morpho, Ethereum ağı üzerine inşa edilmiş bir merkeziyetsiz finans (DeFi) protokolüdür. Ana hedefi, kullanıcıların daha optimize faiz oranlarıyla borç alma ve borç verme işlemlerini gerçekleştirmesini sağlamaktır. Protokol, özellikle Aave ve Compound gibi popüler DeFi protokolleri üzerinde çalışan bir optimizasyon katmanı olarak tasarlanmıştır. Platform, merkeziyetsiz bir kredi ve borç protokolüdür. Kullanıcılar, ERC-20 ve ERC-4626 token’larını teminat göstererek kredi alabilir veya borç verebilir. Morpho’nun benzersiz özelliği, “permissionless market creation” (izin gerektirmeyen pazar oluşturma) özelliğidir. Bu, kullanıcıların kendi risk ve faiz modellerini oluşturarak izole edilmiş pazarlar yaratmalarına olanak tanır.
İlginizi Çekebilir: Morpho Nedir?
Listeleme Sonrası Fiyat Hızla Yükseldi Upbit’in listeleme duyurusunun ardından MORPHO piyasasında alım ilgisi belirgin şekilde arttı. Açıklamanın ardından token fiyatı kısa sürede güçlü bir yükseliş kaydederek günün en dikkat çeken altcoin performanslarından birini sergiledi. Artan işlem hacmiyle birlikte yatırımcıların listeleme haberine olumlu tepki verdiği görülürken, Güney Kore pazarından gelebilecek yeni likidite beklentisi fiyat hareketini destekleyen başlıca unsurlar arasında yer aldı. Kripto para piyasasında Upbit gibi yüksek hacimli borsaların listeleme kararları, ilgili varlıklarda kısa vadeli fiyat artışlarını sıkça tetikleyebiliyor.
Kripto para piyasasında borsa listelemeleri genellikle fiyat üzerinde olumlu etki yaratsa da, kısa vadede sert dalgalanmalar görülebiliyor. Listeleme öncesinde yaşanan yükselişlerin ardından bazı yatırımcıların kar satışına yönelmesi, fiyatın hızlı şekilde geri çekilmesine neden olabiliyor. Bu nedenle uzmanlar, MORPHO işlemi yapmayı planlayan yatırımcıların listeleme sırasında oluşabilecek yüksek volatiliteyi göz önünde bulundurmaları ve risk yönetimine dikkat etmeleri gerektiğini belirtiyor.
Değerlendirme Upbit’in MORPHO’yu KRW işlem çiftiyle listeleyeceğini açıklaması, proje için önemli bir gelişme olarak öne çıkıyor. Güney Kore pazarına doğrudan erişim sağlayacak olan listeleme, tokenin işlem hacmini ve görünürlüğünü artırabilir. Ancak geçmiş listelemelerde görüldüğü gibi, yatırımcıların kısa vadeli fiyat dalgalanmalarına karşı temkinli hareket etmeleri önem taşıyor.
Son dakika kripto para haberleri için hemen tıkla
Konu ile ilgili yorumlarınızı bize yazabilirsiniz. Ayrıca, bu tarz bilgilendirici içeriklerin devamının gelmesini isterseniz, bizleri Telegram, Youtube ve Twitter kanallarımızdan takip edebilirsiniz.
Someone just walked into BonkDAO, spent roughly $4.4 million on tokens, and walked out with approximately $20 million from the treasury. Not by hacking smart contracts. Not by finding a zero-day exploit. By simply showing up to vote when nobody else did.
Welcome to the era of the “apathy attack,” a term coined by Dr. NickA (Nick Almond), Head of Governance at Jito Foundation, to describe a governance exploit pattern that has now hit DAOs from Compound to BonkDAO. The vulnerability isn’t in the code. It’s in the community.
How the BonkDAO attack unfolded On July 6, 2026, an attacker acquired enough BONK tokens to surpass the DAO’s 1% quorum requirement. Only about 2.9% of total participants actively voted on the malicious proposal, spread across just 7 wallets. The proposal passed and drained roughly 4.43 trillion BONK tokens, valued at approximately $20 million, from the treasury.
Post-attack, the stolen tokens were reportedly moved into a newly established “BONK 2.0” multisig DAO controlled by the attacker and their associates.
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The irony is thick: BonkDAO specifically set its quorum at 1% as a measure to deter apathy by making governance participation easy. Instead, the low threshold made governance capture trivially cheap.
Compound’s earlier warning shot Compound, one of DeFi’s most established lending protocols, faced its own governance crisis back in July 2024. Declining voter participation created the conditions for a similar exploit pattern, where proposals could be pushed through without meaningful community consensus. The incident was serious enough that Compound established the Compound Governance Working Group specifically to boost engagement and prevent future attacks.
Dr. NickA has drawn a direct line between these incidents, framing them as part of the same systemic vulnerability. The attack vector doesn’t target code. It targets disengagement. Historical data on DAO voter participation paints a grim picture. Turnout across token-weighted DAOs can dip below 10%, and in some cases falls as low as 0.1% to 3%.
The governance paradox The BonkDAO attack is especially instructive because the $4.4 million spent to acquire tokens yielded roughly $20 million in stolen assets. That’s nearly a 5x return on a governance exploit.
Some protocols have experimented with alternative models. Quadratic voting, conviction voting, and delegate systems all attempt to solve different aspects of the participation problem. But none have achieved widespread adoption, and the dominant model remains one-token-one-vote with fixed quorum thresholds.
What this means for investors Traders and investors evaluating DAO-governed protocols should be paying close attention to governance participation metrics. A protocol with consistently low voter turnout and a large treasury is essentially advertising its vulnerability. The ratio of treasury size to quorum cost becomes a rough measure of exploit profitability.
The emergence of “BONK 2.0” as an attacker-controlled entity adds another wrinkle. If stolen governance tokens can be reorganized into new structures that claim legitimacy, the attack doesn’t just drain a treasury. It fragments a community. Recovery becomes a legal, social, and technical challenge all at once.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
Intel will invest 5 billion euros to expand its factory in Ireland.
Intel (INTC.O) will invest 50 billion euros (approximately $57 billion) to expand its factory in Ireland, aiming to recapture its leading position in manufacturing amid the artificial intelligence boom. In a statement, Intel said the investment will boost production capacity at its Leixlip campus outside Dublin, as part of the company’s plan to increase output of data center processors. The expansion will enhance manufacturing capabilities for products including its flagship Xeon server processors, while advancing research and development activities. Intel Executive Vice President Naga Chandrasekaran noted in a statement that the move is also part of the company’s plan to improve delivery capacity for its foundry business. Intel’s foundry arm, which manufactures chips for other tech companies, is a core component of its revitalization strategy, designed to strengthen its competitiveness against rivals such as TSMC.
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Trump: The United States may take charge of managing the Strait of Hormuz in the future.
US President Trump posted that he may "operate" the Strait of Hormuz in the future, stating that if the US takes the lead in managing the Strait of Hormuz, the US will receive compensation. "We will become the guardians of the Strait of Hormuz."
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US media: Trump's so-called "standing retaliation order against Iran" cannot take effect automatically after his death.
According to the Associated Press, in response to recent remarks by former U.S. President Donald Trump that he has ordered the U.S. military to launch large-scale strikes on Iran if he is assassinated by Tehran, there is no so-called "dead man’s switch" mechanism in U.S. law that automatically triggers military retaliation upon the president’s death. Under the 25th Amendment to the U.S. Constitution and the Presidential Succession Act, if the president dies, Vice President JD Vance will immediately assume the presidency and the role of commander-in-chief, with military command authority transferring simultaneously. The successor president will independently decide whether to execute, modify, or cancel the relevant orders of the predecessor. Experts note that while the U.S. has established government continuity and nuclear contingency plans, it has never allowed the military to automatically launch retaliatory actions based on preset orders after the president’s death.
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Bitmine increased its holdings of 27,801 ETH last week, pushing its total staked amount to 4.917 million ETH, with projected annual staking revenue of $242 million.
Bitmine announced it purchased an additional 27,801 ETH over the past week, and will maintain its steady accumulation pace that has been in place since 2026. The company expects to achieve its so-called "Alchemy of 5%" target this year. As of July 12, Bitmine holds a total of 5.77 million ETH, of which 4.917 million ETH (accounting for 85% of its holdings) has been staked. At an ETH price of $1,820, the total value of its ETH holdings is approximately $9 billion. Based on an annual staking yield of 2.70%, the company’s annual staking revenue is around $242 million; if all its ETH is staked, annual staking rewards would reach $284 million. Additionally, Bitmine said it launched MAVAN (Made in American Validator Network), an institutional-grade Ethereum staking platform, this year, which will be opened to institutional investors, custodian institutions, and ecosystem partners. Bitmine also noted that it is currently the world’s largest ETH reserve institution, and ranks second globally in terms of crypto asset reserve size, trailing only Strategy, which holds 843,775 BTC. The company further stated that the GENIUS Act and the U.S. SEC’s Project Crypto will drive transformation in digital asset financial infrastructure, an impact comparable to that of the end of the 1971 Bretton Woods system on Wall Street’s modernization.
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Hyundai Motor completes enterprise-level USDT cross-border settlement pilot, with cross-border fund transfers finished in just 7 minutes.
Tether announced that Hyundai Motor America and Hyundai Motor Mexico have completed an enterprise cross-border settlement proof of concept (POC) on the Avalanche network via Axiym, marking Tether’s first enterprise cross-border fund settlement pilot. During the pilot, Hyundai Motor America converted $20,000 into USDT, transferred the funds cross-border to Hyundai Motor Mexico, which then converted the amount back to USD. The entire cross-border transfer and verification process took an average of just 7 minutes, a notable acceleration compared to traditional bank cross-border remittances, which typically take 3 to 4 hours or longer. Tether noted that the pilot demonstrates stablecoins’ application potential in enterprise cross-border payments, fund management, and global fund allocation. In the next phase, the project will explore additional cross-border payment channels and local currency settlement scenarios, further evaluating stablecoins’ use in enterprise treasury management.
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Trump: I am taking over the Strait of Hormuz, Iran got nothing at all.
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Samsung Electronics and SK Hynix each unveiled major chip investment plans Monday at a presidential briefing in Seoul. Neither announcement stopped their stocks from falling sharply.
Samsung dropped 5.3% to 321,500 won from a Friday close of 339,500 won. SK Hynix fell 3.4% to 2,583,000 won from 2,673,000 won. The KOSPI settled near 8,258, down from 8,411.
Why the Announcements Didn’t Move Markets HigherSamsung Group presented a roughly 1,000 trillion won spending package to President Lee Jae-myung. SK Group followed with a separate 1,000 trillion won plan. Both cover new semiconductor fabs, AI data centers, and chip cluster development over the next decade. Fortune reported the combined figure at around $1.3 trillion.
Markets shrugged. The Korea Exchange scrapped its planned launch of weekly options contracts tied to Samsung, SK Hynix, Hyundai Motor, and LG Energy Solution. Regulators pulled the product after retail investors poured into daily double-leveraged ETFs, pushing KOSPI volatility to record highs. That decision removed a key tool for short-term traders and hit speculative appetite immediately.
Despite a breakout last 12 months, the KOSPI is down in the last month and opened the new week down again. Image Source: Trading ViewChip Selloff and Middle East Pressure Compound the PainGlobal tech sentiment stayed negative. Last week, South Korea’s market triggered circuit breakers twice on fears over AI chip valuations. Samsung and SK Hynix make up roughly 42% of the KOSPI, so chip selling anywhere hits Seoul hard. South Korean retail investors who borrowed heavily during recent rallies now face compounding losses.
🚨 KOSPI JUST CLOSED ONE OF ITS WORST WEEK OF 2026.
South Korean market is down 10% in just one week, wiping out roughly ₩550 TRILLION ($350 BILLION) from the market.
AI and semiconductor stocks are leading the collapse as panic spreads across Korean markets. pic.twitter.com/iSBrIyoj7H
— Crypto Rover (@cryptorover) June 27, 2026 Middle East tension added pressure. The US struck Iranian military targets over the weekend. Both sides then agreed to halt attacks and meet on Tuesday in Doha. Japan’s Nikkei 225 also fell as SoftBank retreated, extending a pullback after six consecutive record sessions.
The websites of crypto lending platform Compound Finance and Celer Network have been attacked, redirecting users to a malicious phishing site, according to multiple security researchers.
Compound, one of the longest-established decentralized finance (DeFi) applications, holds assets worth over $2B, according to data from DeFiLlama. Celer’s cBridge allows users to send tokens between 14 blockchains, processing over $200M in volume last month.
Security advisor to the Compound DAO, Michael Lewellen, posted a community alert via X (formerly Twitter), urging users to avoid the platform’s website. Compound Finance confirmed the attack 90 minutes later. The breach was highlighted earlier by ZachXBT via Telegram.
ALERT: The https://t.co/vSAGYl6wwJ URL has been compromised and is currently hosting a phishing site. DO NOT interact with the https://t.co/vSAGYl6wwJ website until further notice.
The Compound protocol itself is not impacted and all smart contract funds are safe.
— Michael Lewellen (@LewellenMichael) July 11, 2024 Read more: Compound Finance upgrade bug freezes $830M in crypto
Celer Network alerted users four hours later to a similar attack that “seems to be hitting multiple projects at the same time.” Pseudonymous security researcher Samczsun suspects the breaches to have come from Squarespace. DeFiLlama’s 0xngmi compiled a list of other domains that may be at risk.
This type of attack, known as a ‘front-end’ attack, is a relatively common vector for crypto hackers. The method doesn’t rely on finding a bug to exploit within the underlying smart contract code, instead simply replacing the project’s website with a malicious version.
A potential attacker must compromise the domain name service (DNS) registrar, generally using financial incentives or social engineering techniques on an employee. In response to the front-end attack that hit Curve Finance in June 2022, the CEO of Namecheap (the DNS registrar responsible) stated that a customer service agent was compromised, claiming they were either hacked or exploited with bitcoin.
Dear @iwantmyname, looks like something is compromised on your side (most likely, name servers – they seem to override what the UI tells them to serve). Please do something.
For everyone else: we switched nameserver, but don't rush to use https://t.co/vOeMYOTq0l – wait a bit
— Curve Finance (@CurveFinance) August 9, 2022 Read more: At least $25M lost across three incidents in busy day for crypto hackers
Similar incidents have affected many major DeFi platforms, such as Curve Finance, Cream Finance, Pancake Swap, Balancer, Frax and Velodrome, among others.
Previous hacks often involve cloning the original website, but swapping out key elements which can lead to users’ wallets crafting malicious transactions. This could be to transfer funds directly to an address controlled by the hacker, or to ‘harvest’ token approvals.
This approvals harvesting technique was used to devastating effect in the $120M BadgerDAO hack of December 2021.
Over the course of 12 days, BadgerDAO users inadvertently signed malicious approval transactions which granted the exploiter permission to spend tokens directly from the victims’ wallets. Now-bankrupt Celsius was among the victims, losing 897 BTC (worth over $40M at the time), before forfeiting $22M worth of compensation due to an ‘unforced error’.
Despite today’s incident, Compound’s back-end code is considered amongst the most secure in DeFi, with any changes requiring scrutiny via a fully on-chain governance process.
Low-effort ‘forks’, however, regularly find themselves exploited due to dodgy collateral or basic errors when setting up new markets.
Compound itself hasn’t been entirely without its issues in the past, though.
🚨 Alert: @compoundfinance's Twitter account has been compromised. Do not click on any links posted from their account.
A phishing link (compound-labs[.]xyz) was spotted 16 hours ago.
Stay vigilant and ensure the safety of your assets by avoiding suspicious links. pic.twitter.com/yoa1RM4P4E
— Scam Sniffer | Web3 Anti-Scam (@realScamSniffer) December 29, 2023 Read More: Linea protocol ZeroLend is a ‘copy-paste’ Aave fork, linking to original’s docs
The project’s X account was compromised in December 2023 to spread a phishing link, promising free COMP, the project’s native token.
In September and October of 2021, a total of almost $150M worth of COMP was accidentally distributed as excess rewards to users. Another incident the following year saw the platform’s $830M ETH market frozen for a week.
Got a tip? Send us an email or ProtonMail. For more informed news, follow us on X, Instagram, Bluesky, and Google News, or subscribe to our YouTube channel.
A major DNS attack targeting the Squarespace domain registrar has shocked the cryptocurrency community, prompting warnings and preventive measures. The attack has already compromised the domains of Celer Network and Compound Finance, raising concerns about the security of numerous other crypto-related websites.
Coingecko co-founder Bobby Ong has advised users to refrain from interacting with crypto platforms for the next few days until the situation is resolved. "The best thing to do is to not interact with crypto and rest for the next couple of days until everything is resolved," Ong stated.
The vulnerability stems from Squarespace's acquisition of Google Domains registrations in June 2023. The forced migration of domains to Squarespace reportedly removed two-factor authentication (2FA) for many users, leaving these domains susceptible to hijacking.
0xngmi has compiled a list of notable domains that share the same registrar and could be at risk. These include:
http://pendle.finance http://karak.network http://hyperliquid.xyz http://dydx.exchange http://thorchain.com http://axelar.network http://vertexprotocol.com http://hop.exchange http://polymarket.com http://yieldyak.com While none of the domains on this list have been confirmed as hacked yet, the shared registrar with Celer Network and Compound Finance has raised alarms.
The situation underscores the importance of robust security measures in the crypto space, particularly concerning domain management and DNS protection. As the attack continues to unfold, users are urged to exercise caution and remain vigilant.
Disclaimer: This article is based on the information available as of July 11, 2024. The situation is ongoing, and updates will continue to emerge as the investigation progresses.
Two prominent crypto projects have been exploited and many more could be at risk after two-factor authentication (2FA) was disabled, at the front-end, for projects using Google Domains amid a migration to Squarespace.
Posted July 11, 2024 at 2:27 pm EST.
The recent hacks of Compound Finance and Celer Network’s front-end domains on Wednesday revealed at least an additional 124 domains are at risk of exploitation by virtue of their registration with website-building company Squarespace, according to security experts.
Compound Finance, one of the largest decentralized protocols with a total locked value of nearly $2.2 billion, is hosting a phishing site, said Michael Lewellen, head of solutions architecture at blockchain security firm OpenZepplin, on X. He warned users not to interact with the website until further notice.
Another attacker, perhaps the same one or group, also attempted to take over the front-end domains of Celer Network. The team said on X that the takeover was intercepted and that their “investigation indicates that the attack vector likely involved third parties beyond our control.”
In a conversation with Unchained, the founder of blockchain network Glue and prominent white-hat hacker who goes by Ogle indicated that Compound Finance and Celer Network’s use of Squarespace to host their front-end websites is what allowed these exploits to occur.
“Right now, [Compound Finance is] exploited to the point that links are changed and so people can be phished,” he added. Phishing is a type of scam where exploiters use deception to make people reveal sensitive information or install malicious software.
Please avoid interacting with the compound[.]finance website until further notice.
It is part of the widespread domain compromise occurring right now. By visiting the site, or clicking any associated links, you will be putting yourself at risk. We and others are diligently…
— Compound Labs (@compoundfinance) July 11, 2024
The at-risk websites initially used Google Domains, but Squarespace acquired the Google Domains business, completing its acquisition of assets in September 2023.
The recent exploits were “almost certainly” from the migration of Google Domains to Squarespace, said Ogle. “What I’ve learned is that during that migration 2FA [short for two-factor authentication] was disabled.”
Compound Finance and Celer Network “probably did have 2FA enabled on Google, but then once it got switched over, not the case anymore,” he added.
“Google sold their domain business to Squarespace a few months ago and the forced migration of domains to Squarespace removed 2FA causing all these domains to be vulnerable and several have been hijacked,” said Bobby Ong, the co-founder of CoinGecko, on X.
Read More: $1 Million Bounty On Offer for Finding Bugs On Solana Validator Client Firedancer
Domains of Top Protocols At-Risk The number of crypto protocols joining the likes of Compound Finance and Celer Network may grow, as the pseudonymous founder of DefiLlama, who goes by the screen name @0xngmi on X, noted that 124 additional front-end domains of prominent crypto protocols are using Squarespace including Pendle Finance, Hyperliquid, dYdX, Nostra Finance, Axelar Network, Polymarket, Thorchain, Aptos Labs, NEAR, and Safe.
A spokesperson for Safe, a wallet infrastructure provider, confirmed with Unchained that Squarespace is involved with its front-end website, but emphasized they haven’t identified any abnormal activity and have systems in place to detect irregular changes.
“We currently remain unaffected,” Safe’s spokesperson said. “Our teams will continue to monitor the situation and keep our community and users informed.”
“As always, stay vigilant,” the spokesperson at Safe added. In a similar vein, the dYdX trading team said to Unchained over Telegram, “dYdX.exchange is secure with no detected vulnerabilities” and that they will also continue to “monitor the situation.” Axelar Network also has not identified any issues with its domain and will continue to track for any further developments, per a post on X.
Read More: 50% of Illicit Funds End Up At Centralized Crypto Exchanges, Chainalysis
The domains of these protocols — barring Compound Finance and Celer Network — remain unaffected. Yet Ogle says protocol team members should be worried as the situation is “not good” and that people should not go to any of these websites “under any circumstances until the official Twitter says it’s safe.”
At presstime, Compound(dot)Finance gets redirected to Compound-Finance(dot)app, in which the latter is flagged by Google as a dangerous site. “Attackers on the site you’re trying to visit might trick you into installing software or revealing things like your password, phone, or credit card number,” according to Google’s warning.
The message Google raises when people try to visit compound(dot)finance, which gets redirected to compound-finance(dot)app. If a user proceeds despite the flagrant, red warning, they’ll see a website that looks like a standard crypto protocol.
The interface of the phishing site is hosted by Compound Finance’s front end. Difference Between a Domain and Protocol While the domain websites of crypto projects may go down in the event of a hijacking, the actual protocols remain unaffected. People or bots can still interact with a project’s smart contract without going through a front-end website, Ogle said.
“You could transfer funds on the blockchain, you could go through their bridge, all that kind of stuff can happen without ever even using the website.” Even if a protocol’s front-end domain is attacked and “taken down by these hackers right now or whatever, you still don’t lose your money. You still have access to it.”
Representatives of Squarespace did not immediately respond to Unchained’s requests for comments.
UPDATE (July 12, 2024 10:03 a.m. ET) Includes status update of Axelar Network
TLDR Multiple DeFi protocols, including Compound Finance and Celer Network, were targeted in a DNS hijacking attack. The attack appears to be targeting domains registered through Squarespace. Over 220 DeFi protocol front ends may still be at risk. The attackers are believed to be using the Inferno Drainer wallet kit to steal funds. Some security measures, like requiring wallet signatures for DNS updates, have been suggested to prevent future attacks. On July 11, 2024, several decentralized finance (DeFi) protocols were hit by a DNS hijacking attack. The incident affected major players in the crypto space, including Compound Finance and Celer Network.
Security experts believe the attack is targeting domains registered through Squarespace, a popular website builder and hosting platform.
The attack was first noticed when users reported that the Compound Finance website (compound.finance) was redirecting to a malicious page.
This fake page contained a “drainer” app designed to steal users’ cryptocurrency tokens. Shortly after, Celer Network announced that it had also been targeted, but its domain monitoring system caught the attack before it could succeed.
Blockchain security firm Blockaid has been closely monitoring the situation. According to Ido Ben-Natan, co-founder and CEO of Blockaid, the attackers targeted DNS records hosted on Squarespace. These records were redirected to IP addresses known for malicious activities.
⚠️ Developing situation – Multiple DeFi front ends are at risk of hijacking, with a few incidents already taking place, with projects like @compoundfinance and @CelerNetwork getting hacked over the past 24 hours.
We will update this thread with details as we go. pic.twitter.com/iWQR0ByIgB
— Blockaid (@blockaid_) July 11, 2024
Ben-Natan stated that while the full extent of the hijack is not yet known, approximately 228 DeFi protocol front ends could still be at risk.
The attack is believed to be the work of a group known as Inferno Drainer. This group has been active for some time, targeting various DeFi protocols and exploiting different vulnerabilities.
Their wallet kit allows cybercriminals to trick users into signing malicious transactions, giving the attackers control over their digital assets.
Security researchers have identified shared infrastructure used by the Inferno Drainer group, making it easier to track and identify related attacks.
Blockaid has been working closely with the crypto community to maintain an open channel for reporting compromised sites.
The incident has sparked discussions about improving security measures for DeFi protocols. Matthew Gould, founder of Web3 domain provider Unstoppable Domains, suggested creating verified on-chain records for domains. This would add an extra layer of protection for browsers and other systems to check, helping to reduce the risk of DNS attacks.
Gould also proposed a new feature where DNS updates would require a signature from the user’s wallet. This would make it much harder for hackers, as they would need to compromise both the registrar and the user’s wallet separately.
In response to the attack, several crypto projects and platforms have taken action. MetaMask, a popular Web3 wallet, announced that it is working to warn users of potentially compromised apps associated with the attack.
Users attempting to transact on any known site involved in the current attack will see a warning provided by Blockaid.
For those of you using MetaMask, you’ll see a warning provided by @blockaid_ if you attempt to transact on any known site that’s involved in this current attack. #mmsecurity https://t.co/Fk0sAjaeit
— MetaMask ???????? (@MetaMask) July 11, 2024
The crypto community has rallied to spread awareness and minimize potential damage. DefiLlama developer 0xngmi shared a list of over 100 DeFi protocols that may be affected by the attack, including well-known names like Pendle Finance, dYdX, Polymarket, and LooksRare.
Oliver Dale
Editor-in-Chief of Blockonomi and founder of Kooc Media, A UK-Based Online Media Company. Believer in Open-Source Software, Blockchain Technology & a Free and Fair Internet for all. His writing has been quoted by Nasdaq, Dow Jones, Investopedia, The New Yorker, Forbes, Techcrunch & More. Contact [email protected]
The coalition has secured ETH commitments to refill the bridge in tranches and will use Aave and Compound governance proposals to liquidate the exploiter's remaining positions.
DeFi United, a coalition of decentralized finance (DeFi) ecosystem participants, on Tuesday published the technical implementation plan to restore the backing of Kelp DAO's rsETH and recover roughly 107,000 tokens still controlled by the exploiter.
The exploit targeted rsETH's LayerZero-powered bridge on the Unichain to Ethereum route, where a forged inbound packet was verified on the Ethereum side without a corresponding burn on Unichain. The attack released 116,500 rsETH from the Ethereum-side adapter, with proceeds distributed across multiple addresses and supplied as collateral on lending protocols.
Seven addresses associated with the exploiter currently hold active rsETH-backed positions on Aave and Compound, representing approximately 107,000 rsETH of the original 116,500 rsETH stolen.
Restoring BackingDeFi United said it has secured the ETH commitments needed to restore rsETH’s backing, with final execution subject to governance approvals and definitive agreements. The committed ETH will be converted into rsETH in tranches and transferred to the bridge lockbox contract, allowing the bridge to resume normal operation.
The process targets rsETH's nominal exchange ratio of 1.07 ETH. The coalition's fundraising effort has progressively chipped away at the original 163,200 ETH shortfall.
LayerZero Labs on Tuesday pledged more than 10,000 ETH to the effort, donating 5,000 ETH directly to DeFi United and depositing an additional 5,000 ETH to strengthen Aave markets' liquidity. The firm said it would also strategically deepen liquidity for Aave's GHO stablecoin.
Clearing Exploiter’s PositionsRecovering the exploiter’s excess collateral requires governance proposals pertaining to Aave’s Ethereum and Arbitrum deployments. The execution involves a controlled liquidation sequence: the rsETH oracle price will be temporarily adjusted to enable efficient liquidation, generating a temporary deficit to be addressed in a subsequent step. Recovered rsETH will be transferred to a DeFi United multisig and redeemed for ETH through Kelp's standard redemption procedure, with the resulting ETH applied to clear the Aave Ethereum and Arbitrum deficits.
The Aave clearing process aims to recover approximately 13,000 ETH. Compound will take a similar approach with DeFi United providing the liquidity, recovering an estimated 16,776 ETH.
WETH and rsETH reserves on Ethereum Core, Arbitrum, Base, Mantle, and Linea will remain frozen during the process. The final phase involves unpausing and unfreezing rsETH and ETH across affected instances and restoring loan-to-value ratios for any assets whose configurations were temporarily adjusted.
RisksDeFi United flagged several execution risks. ETH deployment is contingent on finalizing agreements and governance approvals. Deliberate interference by the attacker could result in incomplete accrual of deficits, requiring additional liquidation steps to fully resolve the positions. Residual bridge risk also remains until the newly implemented LayerZero and Kelp security measures are validated in production.
This article was written with the assistance of AI workflows. All our stories are curated, edited and fact-checked by a human.
Morgan Stanley raises Micron's price target to $1,200, maintains 'Overweight' rating.
Morgan Stanley released a report raising Micron Technology (MU.O)’s price target from $1,050 to $1,200, while maintaining an "Overweight" rating. The investment bank lifted its fiscal 2027 earnings per share (EPS) forecast for the chipmaker by roughly 40% to $168, and upgraded its free cash flow (FCF) projection from $104 billion to $140 billion. Aligning with Micron’s management, the bank holds that AI will push DRAM demand to consistently outpace supply significantly after 2027. Micron’s last fiscal quarter results matched this trend, with both its quarterly performance and outlook showing notable upside potential.
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US officials: Israel has withdrawn troops from parts of the buffer zone in southern Lebanon.
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CBRS trades below IPO price post-earnings: Erases all gains six weeks after listing, two smart money firms net $5.8 million from first-day IPO shorts.
According to Hyperinsight monitoring, Cerebras (CBRS), the AI chip firm previously dubbed "Nvidia’s strongest challenger", saw its stock price fall in stages after reporting its first quarterly results since going public, as negative guidance overshadowed better-than-expected performance. The stock has dropped roughly 22% since the earnings release and officially broke below its IPO price today. On-chain whales are overall bearish. CBRS trades at $184 on the Hyperliquid platform, down 7.7% in 24 hours. Large-scale short positions (million-dollar level) total around $11.62 million, 2.39 times the long positions ($4.87 million). Two major short positions were placed precisely at high levels as early as the IPO day or even before the IPO: - Whale 0xe0ff: Shorted at $284.51 on May 14 with a 3x leveraged position of $6.13 million, generating an unrealized profit of $3.24 million (+104%); - Whale 0x9996: Shorted at $275.92 on May 11 with a 5x leveraged position of $5.48 million, generating an unrealized profit of $2.64 million (+162%). It is learned that both addresses currently hold short positions in both CBRS and SPCX, and have recorded substantial unrealized profits, preferring to place short positions at high levels before or on the day of major stock listings. With the realization of negative earnings news in this round, the combined unrealized profit of the two positions is around $5.88 million. Currently, the average entry price of CBRS short whales is around $275, and the current price is over 30% lower than that. The nearest short liquidation line is at $200.13, about 7% away from the current price.
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Multiple high-performing domestic public mutual fund products have tightened their purchase restrictions.
E Fund Management announced in its latest filing that the E Fund Information Industry Select Fund, managed by Zheng Xi, has cut its purchase limit to 10,000 yuan. The same purchase limit reduction to 10,000 yuan applies to another fund under his management, E Fund Information Industry Fund, while E Fund Global Growth Select Hybrid Fund (QDII) has lowered its purchase limit to 10 yuan. In addition, Guolianan Preferred Industry Fund, Harvest Tech Innovation Fund, and Principal Performance-Driven Fund have also announced purchase limits or adjustments to their limits recently. Jin Zicai, a fund manager closely watched by the market, imposed additional purchase limits on multiple public offering funds under his management, with the four funds involved cutting their purchase limits to 500 yuan starting June 23. Purchase limits on high-performing funds likely stem from multiple considerations: they can avoid return dilution caused by short-term concentrated subscriptions, and proactive limits during overheated market conditions also send risk warning signals to the market. As the first half of the year draws to a close, such moves have become increasingly frequent. Overall, Wind data shows that since June alone, 19 funds with year-to-date net asset value returns exceeding 90% have suspended large subscriptions or adjusted their purchase caps. (Source: Cailian Press)
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The US stock market's optical communication sector rises across the board in pre-market trading, with Corning up 9.28%.
According to Bitget market data, the U.S. stock market's optical communication sector saw broad pre-market gains, with MRVL rising 4.99%, LITE up 3.24%, Nokia up 3.11%, Corning up 9.28%, and AXTI up 6.69%.
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US-listed AI chip stocks saw mixed pre-market performance, with Qualcomm surging 13%.
According to Bitget market data, U.S. AI chip stocks posted mixed pre-market performance: Qualcomm (QCOM.O) surged 13%, Intel (INTC.O) rose nearly 6%, AMD (AMD.O) gained nearly 4%, and Google (GOOG.O) declined 1.4%.
Morgan Stanley raises Micron's price target to $1,200, maintains 'Overweight' rating.
Morgan Stanley released a report raising Micron Technology (MU.O)’s price target from $1,050 to $1,200, while maintaining an "Overweight" rating. The investment bank lifted its fiscal 2027 earnings per share (EPS) forecast for the chipmaker by roughly 40% to $168, and upgraded its free cash flow (FCF) projection from $104 billion to $140 billion. Aligning with Micron’s management, the bank holds that AI will push DRAM demand to consistently outpace supply significantly after 2027. Micron’s last fiscal quarter results matched this trend, with both its quarterly performance and outlook showing notable upside potential.
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US officials: Israel has withdrawn troops from parts of the buffer zone in southern Lebanon.
A U.S. State Department official said Israel has withdrawn from parts of the buffer zone in southern Lebanon, describing the move as a "goodwill gesture" toward the Lebanese government.
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CBRS trades below IPO price post-earnings: Erases all gains six weeks after listing, two smart money firms net $5.8 million from first-day IPO shorts.
According to Hyperinsight monitoring, Cerebras (CBRS), the AI chip firm previously dubbed "Nvidia’s strongest challenger", saw its stock price fall in stages after reporting its first quarterly results since going public, as negative guidance overshadowed better-than-expected performance. The stock has dropped roughly 22% since the earnings release and officially broke below its IPO price today. On-chain whales are overall bearish. CBRS trades at $184 on the Hyperliquid platform, down 7.7% in 24 hours. Large-scale short positions (million-dollar level) total around $11.62 million, 2.39 times the long positions ($4.87 million). Two major short positions were placed precisely at high levels as early as the IPO day or even before the IPO: - Whale 0xe0ff: Shorted at $284.51 on May 14 with a 3x leveraged position of $6.13 million, generating an unrealized profit of $3.24 million (+104%); - Whale 0x9996: Shorted at $275.92 on May 11 with a 5x leveraged position of $5.48 million, generating an unrealized profit of $2.64 million (+162%). It is learned that both addresses currently hold short positions in both CBRS and SPCX, and have recorded substantial unrealized profits, preferring to place short positions at high levels before or on the day of major stock listings. With the realization of negative earnings news in this round, the combined unrealized profit of the two positions is around $5.88 million. Currently, the average entry price of CBRS short whales is around $275, and the current price is over 30% lower than that. The nearest short liquidation line is at $200.13, about 7% away from the current price.
1 minutes ago
Multiple high-performing domestic public mutual fund products have tightened their purchase restrictions.
E Fund Management announced in its latest filing that the E Fund Information Industry Select Fund, managed by Zheng Xi, has cut its purchase limit to 10,000 yuan. The same purchase limit reduction to 10,000 yuan applies to another fund under his management, E Fund Information Industry Fund, while E Fund Global Growth Select Hybrid Fund (QDII) has lowered its purchase limit to 10 yuan. In addition, Guolianan Preferred Industry Fund, Harvest Tech Innovation Fund, and Principal Performance-Driven Fund have also announced purchase limits or adjustments to their limits recently. Jin Zicai, a fund manager closely watched by the market, imposed additional purchase limits on multiple public offering funds under his management, with the four funds involved cutting their purchase limits to 500 yuan starting June 23. Purchase limits on high-performing funds likely stem from multiple considerations: they can avoid return dilution caused by short-term concentrated subscriptions, and proactive limits during overheated market conditions also send risk warning signals to the market. As the first half of the year draws to a close, such moves have become increasingly frequent. Overall, Wind data shows that since June alone, 19 funds with year-to-date net asset value returns exceeding 90% have suspended large subscriptions or adjusted their purchase caps. (Source: Cailian Press)
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The US stock market's optical communication sector rises across the board in pre-market trading, with Corning up 9.28%.
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US-listed AI chip stocks saw mixed pre-market performance, with Qualcomm surging 13%.
According to Bitget market data, U.S. AI chip stocks posted mixed pre-market performance: Qualcomm (QCOM.O) surged 13%, Intel (INTC.O) rose nearly 6%, AMD (AMD.O) gained nearly 4%, and Google (GOOG.O) declined 1.4%.
PANews reported on May 8th that, according to its governance page, the Arbitrum DAO passed an AIP proposal with 90.96% support, approving the release of 30,765.67 ETH previously frozen by the Security Council to compensate rsETH holders affected by the attack. The proposal was jointly initiated by Aave Labs, KelpDAO, LayerZero, EtherFi, and Compound. The funds will be transferred to a designated recovery address signed by multiple parties to restore the asset backing of rsETH. This release is a one-off measure, and Aave Labs has also committed to unconditionally indemnifying all parties involved in any claims that may arise from the freezing and release.
TLDR: Compound governance approved an oracle tweak that enabled liquidation of stolen rsETH collateral. The attacker used 116,500 rsETH as collateral to borrow ETH and wstETH across Compound v3. DeFi United seized nearly $30M after temporary oracle bounds forced undercollateralization. The recovered rsETH was redeemed into ETH to help restore KelpDAO’s damaged bridge reserves. DeFi governance proved capable of acting as an emergency recovery mechanism after the April 2026 KelpDAO exploit. Roughly 116,500 rsETH worth $292 million were stolen and deployed as collateral on Compound v3.
Standard liquidation rules offered no path to recovery, since the stolen rsETH still priced normally. A governance-approved oracle adjustment changed that, eventually enabling DeFi United to seize roughly $30 million. The recovery marked one of the most coordinated on-chain interventions in DeFi’s history.
Why Standard Liquidation Rules Could Not Touch the Attacker’s Position On April 18, 2026, attackers exploited a vulnerability in KelpDAO’s LayerZero bridge infrastructure. About 116,500 rsETH worth $292 million were released illegitimately from the Ethereum-side escrow.
The attack was widely attributed to North Korea’s Lazarus Group. Rather than selling, the attacker deployed them as collateral across multiple lending protocols.
On-chain data shows the attacker opened a Compound v3 position within minutes of the exploit. ETH and wstETH were borrowed in tranches against the stolen rsETH tokens.
Partial withdrawals helped manage the collateral ratio in the same window. The position was active and borrowing real assets before the protocol could respond.
In the weeks that followed, the position remained technically healthy at market prices. Compound’s rsETH markets were frozen, and loan-to-value ratios were set to zero.
The stolen rsETH still priced normally despite having no legitimate backing. Automated liquidation mechanisms therefore had no grounds to trigger.
DeFi lending liquidations depend on collateral value falling below set thresholds. Because rsETH had not dropped in price, the attacker’s position stayed above water.
There was no admin key or circuit breaker available to freeze the account. DeFi governance was therefore the only available instrument to act.
How a Governance Proposal Triggered Liquidation and Recovered the Collateral The Compound Foundation engaged risk partners, including Gauntlet, to find a resolution pathway. Gauntlet submitted a proposal for a modified oracle for Compound’s rsETH markets.
The new oracle kept the Kelp DAO exchange rate feed as its primary source. It also added configurable price bounds operable by the Compound multisig.
Santiment Intelligence noted that an oracle adjustment pushed the attacker’s position into liquidation. This allowed DeFi United to seize roughly $30 million in collateral.
👏 How was Compound governance able to help recover stolen rsETH from the KelpDAO exploiter? An oracle adjustment pushed the attacker’s position into liquidation, allowing DeFi United to seize ~$30M in collateral.
Check out our latest deep dive below. 👇https://t.co/LvqxqLrBYe pic.twitter.com/im4ot8o8xd
— Santiment Intelligence (@SantimentData) May 13, 2026
Temporarily setting the price floor below market value triggered undercollateralization. A DeFi United Recovery Guardian multisig then repaid the borrowed assets and seized the collateral.
Santiment data recorded $29,044,839 in Compound v3 liquidations on May 9th at 02:30 UTC. The event covered 12,426.70 rsETH at a price of $2,337.29 per token.
Notably, rsETH showed no meaningful price distress during the event. The collateral was removed cleanly without triggering a broader market selloff.
The seized collateral was redeemed through KelpDAO’s system and converted back to ETH. Those funds helped refill the damaged bridge lockbox that backed rsETH.
After completion, the oracle was restored to normal market levels. No persistent changes were made to the Compound protocol.
PANews reported on May 14th that the Compound Foundation stated that, following collaboration with the Aave and KelpDAO teams, all WETH and wstETH Comet positions involved in the rsETH vulnerability exploit were closed over the weekend, and all rsETH held by the attackers has been transferred to DeFi United. Compound stated that this swift action effectively mitigated market risks and protected the protocol's suppliers and reserve funds. Transfer restrictions on Ethereum WETH and wstETH Comet have now been lifted, and all Comet markets have resumed normal operation.
PANews reported on May 21 that Cycles, a multilateral clearing startup founded by Cosmos co-founder Ethan Buchman, has completed a new funding round of $6.4 million, led by Blockchange Ventures, with participation from Coinbase Ventures, Compound VC, Primitive Ventures, and others, bringing its total funding to $8.7 million. Cycles aims to create an open clearing protocol that uses zero-knowledge proofs (ZK), trusted execution environments (TEEs), and graph algorithms to clear more transactions between multiple parties with less capital. Lynq and FalconX, as the first partners of Cycles Prime, will participate in pilot testing on the testnet with market makers, prime brokers, exchanges, and several leading trading institutions. The company also launched Cycles Pay, a stablecoin pegged to its clearing engine.
Morgan Stanley raises Micron's price target to $1,200, maintains 'Overweight' rating.
Morgan Stanley released a report raising Micron Technology (MU.O)’s price target from $1,050 to $1,200, while maintaining an "Overweight" rating. The investment bank lifted its fiscal 2027 earnings per share (EPS) forecast for the chipmaker by roughly 40% to $168, and upgraded its free cash flow (FCF) projection from $104 billion to $140 billion. Aligning with Micron’s management, the bank holds that AI will push DRAM demand to consistently outpace supply significantly after 2027. Micron’s last fiscal quarter results matched this trend, with both its quarterly performance and outlook showing notable upside potential.
1 minutes ago
US officials: Israel has withdrawn troops from parts of the buffer zone in southern Lebanon.
A U.S. State Department official said Israel has withdrawn from parts of the buffer zone in southern Lebanon, describing the move as a "goodwill gesture" toward the Lebanese government.
1 minutes ago
CBRS trades below IPO price post-earnings: Erases all gains six weeks after listing, two smart money firms net $5.8 million from first-day IPO shorts.
According to Hyperinsight monitoring, Cerebras (CBRS), the AI chip firm previously dubbed "Nvidia’s strongest challenger", saw its stock price fall in stages after reporting its first quarterly results since going public, as negative guidance overshadowed better-than-expected performance. The stock has dropped roughly 22% since the earnings release and officially broke below its IPO price today. On-chain whales are overall bearish. CBRS trades at $184 on the Hyperliquid platform, down 7.7% in 24 hours. Large-scale short positions (million-dollar level) total around $11.62 million, 2.39 times the long positions ($4.87 million). Two major short positions were placed precisely at high levels as early as the IPO day or even before the IPO: - Whale 0xe0ff: Shorted at $284.51 on May 14 with a 3x leveraged position of $6.13 million, generating an unrealized profit of $3.24 million (+104%); - Whale 0x9996: Shorted at $275.92 on May 11 with a 5x leveraged position of $5.48 million, generating an unrealized profit of $2.64 million (+162%). It is learned that both addresses currently hold short positions in both CBRS and SPCX, and have recorded substantial unrealized profits, preferring to place short positions at high levels before or on the day of major stock listings. With the realization of negative earnings news in this round, the combined unrealized profit of the two positions is around $5.88 million. Currently, the average entry price of CBRS short whales is around $275, and the current price is over 30% lower than that. The nearest short liquidation line is at $200.13, about 7% away from the current price.
1 minutes ago
Multiple high-performing domestic public mutual fund products have tightened their purchase restrictions.
E Fund Management announced in its latest filing that the E Fund Information Industry Select Fund, managed by Zheng Xi, has cut its purchase limit to 10,000 yuan. The same purchase limit reduction to 10,000 yuan applies to another fund under his management, E Fund Information Industry Fund, while E Fund Global Growth Select Hybrid Fund (QDII) has lowered its purchase limit to 10 yuan. In addition, Guolianan Preferred Industry Fund, Harvest Tech Innovation Fund, and Principal Performance-Driven Fund have also announced purchase limits or adjustments to their limits recently. Jin Zicai, a fund manager closely watched by the market, imposed additional purchase limits on multiple public offering funds under his management, with the four funds involved cutting their purchase limits to 500 yuan starting June 23. Purchase limits on high-performing funds likely stem from multiple considerations: they can avoid return dilution caused by short-term concentrated subscriptions, and proactive limits during overheated market conditions also send risk warning signals to the market. As the first half of the year draws to a close, such moves have become increasingly frequent. Overall, Wind data shows that since June alone, 19 funds with year-to-date net asset value returns exceeding 90% have suspended large subscriptions or adjusted their purchase caps. (Source: Cailian Press)
1 minutes ago
The US stock market's optical communication sector rises across the board in pre-market trading, with Corning up 9.28%.
According to Bitget market data, the U.S. stock market's optical communication sector saw broad pre-market gains, with MRVL rising 4.99%, LITE up 3.24%, Nokia up 3.11%, Corning up 9.28%, and AXTI up 6.69%.
1 minutes ago
US-listed AI chip stocks saw mixed pre-market performance, with Qualcomm surging 13%.
According to Bitget market data, U.S. AI chip stocks posted mixed pre-market performance: Qualcomm (QCOM.O) surged 13%, Intel (INTC.O) rose nearly 6%, AMD (AMD.O) gained nearly 4%, and Google (GOOG.O) declined 1.4%.
PANews reported on May 27th that, according to The Block, Manuel Aráoz, co-founder of crypto security firm OpenZeppelin, stated that he now believes "all DeFi" is insecure and has been advising friends and family to exit all DeFi positions, including low-risk positions in blue-chip protocols such as Aave, MakerDAO, and Compound. Aráoz pointed out that the asymmetry between attackers and defenders in security incidents is intensifying; programming agents possess superhuman abilities to discover vulnerabilities, requiring defenders to fix every single one, while attackers only need a single exploit to steal funds.
Nearly $630 million was stolen from DeFi protocols in April, the worst month since the $1.5 billion theft from Bybit in February 2025. Attacks on Drift and Kelp DAO resulted in losses of $285 million and $293 million respectively, both attributed to North Korean hackers. Since mid-April, total value locked in DeFi has decreased by approximately 14%, from about $172 billion to $148 billion.
Morgan Stanley raises Micron's price target to $1,200, maintains 'Overweight' rating.
Morgan Stanley released a report raising Micron Technology (MU.O)’s price target from $1,050 to $1,200, while maintaining an "Overweight" rating. The investment bank lifted its fiscal 2027 earnings per share (EPS) forecast for the chipmaker by roughly 40% to $168, and upgraded its free cash flow (FCF) projection from $104 billion to $140 billion. Aligning with Micron’s management, the bank holds that AI will push DRAM demand to consistently outpace supply significantly after 2027. Micron’s last fiscal quarter results matched this trend, with both its quarterly performance and outlook showing notable upside potential.
1 minutes ago
US officials: Israel has withdrawn troops from parts of the buffer zone in southern Lebanon.
A U.S. State Department official said Israel has withdrawn from parts of the buffer zone in southern Lebanon, describing the move as a "goodwill gesture" toward the Lebanese government.
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CBRS trades below IPO price post-earnings: Erases all gains six weeks after listing, two smart money firms net $5.8 million from first-day IPO shorts.
According to Hyperinsight monitoring, Cerebras (CBRS), the AI chip firm previously dubbed "Nvidia’s strongest challenger", saw its stock price fall in stages after reporting its first quarterly results since going public, as negative guidance overshadowed better-than-expected performance. The stock has dropped roughly 22% since the earnings release and officially broke below its IPO price today. On-chain whales are overall bearish. CBRS trades at $184 on the Hyperliquid platform, down 7.7% in 24 hours. Large-scale short positions (million-dollar level) total around $11.62 million, 2.39 times the long positions ($4.87 million). Two major short positions were placed precisely at high levels as early as the IPO day or even before the IPO: - Whale 0xe0ff: Shorted at $284.51 on May 14 with a 3x leveraged position of $6.13 million, generating an unrealized profit of $3.24 million (+104%); - Whale 0x9996: Shorted at $275.92 on May 11 with a 5x leveraged position of $5.48 million, generating an unrealized profit of $2.64 million (+162%). It is learned that both addresses currently hold short positions in both CBRS and SPCX, and have recorded substantial unrealized profits, preferring to place short positions at high levels before or on the day of major stock listings. With the realization of negative earnings news in this round, the combined unrealized profit of the two positions is around $5.88 million. Currently, the average entry price of CBRS short whales is around $275, and the current price is over 30% lower than that. The nearest short liquidation line is at $200.13, about 7% away from the current price.
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Multiple high-performing domestic public mutual fund products have tightened their purchase restrictions.
E Fund Management announced in its latest filing that the E Fund Information Industry Select Fund, managed by Zheng Xi, has cut its purchase limit to 10,000 yuan. The same purchase limit reduction to 10,000 yuan applies to another fund under his management, E Fund Information Industry Fund, while E Fund Global Growth Select Hybrid Fund (QDII) has lowered its purchase limit to 10 yuan. In addition, Guolianan Preferred Industry Fund, Harvest Tech Innovation Fund, and Principal Performance-Driven Fund have also announced purchase limits or adjustments to their limits recently. Jin Zicai, a fund manager closely watched by the market, imposed additional purchase limits on multiple public offering funds under his management, with the four funds involved cutting their purchase limits to 500 yuan starting June 23. Purchase limits on high-performing funds likely stem from multiple considerations: they can avoid return dilution caused by short-term concentrated subscriptions, and proactive limits during overheated market conditions also send risk warning signals to the market. As the first half of the year draws to a close, such moves have become increasingly frequent. Overall, Wind data shows that since June alone, 19 funds with year-to-date net asset value returns exceeding 90% have suspended large subscriptions or adjusted their purchase caps. (Source: Cailian Press)
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The US stock market's optical communication sector rises across the board in pre-market trading, with Corning up 9.28%.
According to Bitget market data, the U.S. stock market's optical communication sector saw broad pre-market gains, with MRVL rising 4.99%, LITE up 3.24%, Nokia up 3.11%, Corning up 9.28%, and AXTI up 6.69%.
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US-listed AI chip stocks saw mixed pre-market performance, with Qualcomm surging 13%.
According to Bitget market data, U.S. AI chip stocks posted mixed pre-market performance: Qualcomm (QCOM.O) surged 13%, Intel (INTC.O) rose nearly 6%, AMD (AMD.O) gained nearly 4%, and Google (GOOG.O) declined 1.4%.
Former OpenZeppelin CTO Manuel Aráoz advised friends and family to exit Aave, MakerDAO, and Compound, citing AI coding agents that are now “superhuman” at finding vulnerabilities, though OpenZeppelin pushed back.
Posted May 28, 2026 at 6:33 am EST.
Manuel Aráoz, former CTO and co-founder of blockchain security firm OpenZeppelin, said in an X post Tuesday that he now considers “all” of decentralized finance unsafe, citing the rise of AI coding agents as a structural threat that traditional audits cannot keep pace with.
“PSA: I now consider all of DeFi unsafe,” Aráoz wrote. “Coding agents are superhuman at finding vulnerabilities, and smart contract security is too asymmetric: defenders need to fix every bug while attackers need just one exploit to steal funds.” He added that he has advised friends and family to exit positions in major DeFi protocols including Aave, MakerDAO, and Compound, three of the most established lending and stablecoin platforms in the ecosystem.
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Aráoz’s standing matters even though he no longer represents OpenZeppelin. He co-founded the firm in 2015 alongside current CEO Demian Brener, and the OpenZeppelin smart contract library underpins audits for Aave, Compound, MakerDAO, Uniswap, Coinbase, and the Ethereum Foundation. He served as CTO before departing in 2019.
“Aráoz’s views do not represent OpenZeppelin‘s current position,” OpenZeppelin pushed back on the post publicly via a OpenZeppelin has been building AI-augmented security tooling, including a system called Skills that gives AI coding agents authoritative knowledge of audited smart contract libraries.
The numbers behind Aráoz’s warning are bleak.
DefiLlama data shows more than $1.1 billion lost to DeFi hacks over the past 365 days. April 2026 alone saw nearly $630 million drained across at least 27 reported exploits, the worst month for DeFi security since the Bybit incident in early 2025. The $292 million Kelp DAO bridge exploit on April 18, attributed to North Korea’s Lazarus Group, led the month, followed by a $285 million loss at Drift Protocol tied to a six-month social engineering campaign. Step Finance shut down earlier this year after a $27 million exploit it could not recover from. Since January 2026, more than $137 million has been drained from at least 15 DeFi platforms.
The structural argument Aráoz makes has not been resolved by the industry. Audits cost money, take weeks, and cover code as it exists at the time of review, not the version that a determined attacker probes weeks later. Anthropic has restricted public access to its Claude Mythos model in part because of concerns about its ability to autonomously discover and weaponize software flaws.
OpenZeppelin itself published a framework in May called the “Four Layers of DeFi Risk,” explicitly arguing that audits alone are no longer sufficient. The disagreement between Aráoz and his former firm is less about whether the threat has changed than about whether the right response is to retreat from DeFi entirely or to invest harder in AI-augmented defense.
The FBI recently took out a massive internet scam network, arresting over 300 people, freeing over 2,000 people from human trafficking, and seizing over $8 billion in cryptocurrency.
The FBI said last week that it primarily focused on taking down what it calls “scam compounds” in Asia, Africa, and the Middle East. The scam compounds are typically guarded and filled with trafficked workers who are forced to conduct romance scams and fake investment schemes that target many Americans. Over 2,000 people were freed from the compounds.
The operation focused on Prince Holding Group, a company in Cambodia. Authorities also took out a criminal compound in Dubai, Myanmar, and Thailand. Altogether, the FBI seized over 127,000 bitcoin from the nine scam compounds, which is over $8 billion, making it the largest crypto seizure in human history.
The United States worked with Dubai police to arrest 275 people, six of whom will be transported to the United States to face federal charges.
FBI Director Kash Patel, said the major crackdown gives a clear message to scammers across the world.
“If you target Americans, we will find you, disrupt your network, and bring every available tool of the federal government down on you,” Patel told Fox News.
The FBI also took down the “Democratic Karen Benevolent Army,” an armed militia in Myanmar that has ties to Chinese mobsters and has been engaging in this criminal scam network..
The U.S. seized thousands of smartphones and other office equipment in Thailand, severely crippling the scam infrastructure there.
During the whole operation, the FBI worked with the Royal Thai police, the Burmese army, Dubai’s police, and some Chinese investigators. The FBI also utilized Elon Musk’s Starlink to take down over 7,000 terminals in Myanmar that criminals were using to facilitate communications.
The FBI’s 2025 “Internet Crime Report” states that Americans have been defrauded of $21 billion in cyber-related crimes, with AI and crypto-related scams being the costliest.
Apprehending these con artists and hackers is difficult as the internet allows them to be scattered across the world, seemingly untouchable by American authorities.
If traditional finance got a blockchain makeover, DeFi protocols would inevitably be the result. Here, decentralized apps (DApps) and smart contracts reign supreme, offering you control over your financial future.
From staking your digital assets for crypto yield to conducting anonymous crypto swaps, this guide introduces you to the top DeFi protocols to keep an eye on in 2026.
In This Guide:
12 Top DeFi protocols in 2026 DeFi protocols comparedWhat are DeFi protocols?How do DeFi protocols work?Should you use DeFi protocols?Could DeFi replace traditional finance?Frequently asked questions12 Top DeFi protocols in 2026
1. dYdX
Best DeFi protocol for liquid staking
Token
dYdX
Token max supply
1,000,000,000 DYDX
Market cap
$1.499B
TVL
$401.81M
The dYdX protocol provides advanced financial instruments like perpetual and margin trading within the DeFi ecosystem. The leading exchange operates without KYC, allowing for anonymous, trustless trading. It supports perpetual and margin trading, alongside lending and borrowing, and offers competitive fee structures and gas-free trading experiences.
The platform provides lower collateralization levels compared to competitors, increasing accessibility. dYdX also utilizes StarkWare for increased efficiency and lower transaction fees and allows for community contributions and governance.
Notably, dYdX also transitioned to an independent blockchain within the Cosmos ecosystem, enhancing performance and furthering decentralization.
Pros
Advanced trading options No KYC required Low fees Layer-2 scalability Dynamic interest rates Interoperability with Cosmos Cons
Complex for beginners Dependent on Ethereum Limited spot trading New chain transition challenges Ecosystem adaptation required Trade features: Perpetual trading, margin trading, decentralized order book, layer-2 scalability, cross-margin capabilities.
Security features: Self-custodial security, third-party audits, secured by Ethereum protocol.
Platform and ecosystem features: No KYC, open-source code, integration with Cosmos ecosystem, decentralized governance, off-chain order matching.
2. PancakeSwap
Best DeFi protocol for cost-effective transactions
Token
CAKE
Token max supply
450,000,000 CAKE
Market cap
$974.4M
TVL
$2.224B
PancakeSwap is a top-tier DeFi protocol. It focuses on the Binance Smart Chain blockchain, but supports a total of eight networks, including Ethereum.
PancakeSwap’s native crypto is CAKE, which has a total supply of 450 million tokens. This decentralized exchange leverages an automated market maker (AMM) model, allowing for direct, wallet-to-wallet trades without intermediaries, enhancing user control and security.
Moreover, it offers a range of services beyond simple trades, such as yield farming, staking, and lotteries, enabling users to earn rewards in various ways. Its user-friendly interface makes it accessible for beginners, while its innovative features, like the zkBridge technology, ensure secure and efficient transactions across different blockchain networks.
PancakeSwap’s growth is underscored by its status as the first billion-dollar project on the Binance Smart Chain and its continual upgrades, such as the current PancakeSwap V3, demonstrating its commitment to improving functionality and user experience.
Pros
Intuitive interface High APY for liquidity providers (LPs) Supports staking and farming NFT marketplace Cons
No mobile app No native crypto wallet Trade features: Instant crypto trading, liquidity pools, asset bridging, perpetual trading, and cryptocurrency purchasing.
Game and NFT features: Gaming marketplace, prediction market, NFT marketplace for NFTs on BNB Chain.
DeFi and ecosystem engagement: Governance, initial farm offerings (IFOs), gauge voting and revenue sharing, and farm booster.
3. De.Fi
Best DeFi protocol for monitoring
Token
DEFI
Token max supply
1,000,000,000 DEFI
Market cap
n/a
TVL
n/a
De.Fi provides detailed smart contract analysis to detect potential vulnerabilities and assign security scores. It offers an extensive dashboard for monitoring wallet transactions and balances, alongside powerful investment tools for analyzing and controlling positions in DeFi protocols, NFT collections, and lending markets.
Additionally, De.Fi includes specialized security features like the De.Fi Shield and Scanner for thorough contract examination. It also comes with user-friendly transaction tools such as secure crypto sending and De.Fi Swap for easy cryptocurrency exchanges across various blockchains, making it a well-rounded solution for utilizing the DeFi space safely and effectively.
Uniswap is another leading decentralized exchange. The native token is UNI, which has a total supply of 1 billion tokens.
Governed by its users through the UNI token, it offers a community-driven experience, unlike centralized platforms. Uniswap’s liquidity pools facilitate secure and direct token swaps, ensuring users maintain complete control over their funds. Originally built on Ethereum, it now supports other Ethereum-compatible networks like Polygon and Optimism, offering lower transaction costs.
Uniswap’s simplicity makes it accessible for beginners while providing advanced features for experienced users. This is rare when it comes to DEXs, which can often be tricky to use and less straightforward than their CEX counterparts. Uniswap also boasts broad token availability and deep liquidity, reducing price impact on large trades.
Additionally, the DEX has integrated NFT trading, enhancing its offerings. With nearly 5 million unique wallet addresses and surpassing $1 trillion in trading volume, its popularity and reliability are evident.
Finally, Uniswap’s swap fees are competitive, especially when compared to centralized exchanges, and users can choose cheaper networks to avoid high Ethereum gas fees.
Game and NFT features: NFT marketplace, prediction market.
DeFi and ecosystem engagement: Governance, concentrated liquidity, transaction fee structure.
5. Curve Finance
Best DeFi protocol for stablecoins
Token
CRV
Token max supply
2,091,644,627 CRV
Market cap
$730.32M
TVL
$2.486B
Curve Finance is a leading decentralized exchange (DEX) on the Ethereum blockchain, specializing in the efficient trading of stablecoins and wrapped tokens like wBTC, renBTC, and sBTC. Founded by Michael Egorov, it has quickly risen to prominence, and is particularly famed for its innovative use of liquidity pools and automated market maker (AMM) systems. These allow users to earn high annual interest rates — over 300% in some pools — on deposited cryptocurrency.
The platform distinguishes itself with its unique bonding curve. This is optimized for stablecoins to reduce slippage, allowing significant trades with minimal price impact. This has positioned Curve as a vital component in the DeFi space, especially for those interested in liquidity mining and yield farming.
Curve Finance operates as a decentralized autonomous organization (DAO), with its governance token CRV enabling holders to vote on changes and proposals. This shift to a DAO structure allows Curve to operate with enhanced transparency and community-driven development. Despite its complexity and the potential for impermanent loss, Curve Finance offers significant opportunities for liquidity providers and traders, underlined by security measures including multiple code audits and bug bounties to safeguard user assets.
Pros
Specializes in stablecoins Reduced slippage Governed by DAO Multiple security audits Bug bounties for added safety Cons
Complex for beginners Focused mainly on stablecoins and wrapped tokens Reliance on Ethereum blockchain, leading to potential high gas fees Trade features: Stablecoin specialization, efficient liquidity pools, unique bonding curve, minimal slippage in trades.
Earning features: High annual interest rates from liquidity pools, rewards in CRV tokens, participation in yield farming.
DeFi and ecosystem engagement: Governance via CRV token, high total value locked (TVL), support for various wrapped tokens.
6. Balancer
Best DeFi protocol for multi-tokens pools
Token
BAL
Token max supply
62,244,253 BAL
Market cap
$268.21M
TVL
$1.242B
Balancer is a versatile and innovative DeFi platform that redefines the concept of decentralized exchanges (DEXs) by combining elements of automated market makers (AMMs) and index funds.
Unlike traditional DEXs — which typically focus on two-token liquidity pools — Balancer’s USP lies in its ability to maintain a balanced portfolio through automatic rebalancing, adjusting the pool’s asset allocations in response to market price changes.
Balancer supports three types of pools: public pools, where anyone can add liquidity and earn trading fees; private pools, where only the creator can contribute liquidity and set parameters; and smart pools, which are private pools with adjustable parameters controlled by a smart contract. This flexibility caters to a wide range of user preferences and risk tolerances.
Furthermore, Balancer’s architecture is designed to function on Ethereum and also on six additional blockchain networks, expanding its accessibility and interoperability within DeFi ecosystems. By providing a decentralized platform for multi-asset liquidity, Balancer contributes significantly to the efficiency of the cryptocurrency market.
Complex for beginners Limited on smaller chains Trade features: Multi-token pools, automated portfolio rebalancing, customizable pool types (public, private, smart), wide asset variety, minimal slippage through dynamic trading fees.
Earning features: Rewards in BAL tokens, high yield from liquidity provision, participation in liquidity mining, diversified income streams through various pool types.
DeFi and ecosystem engagement: Governance via BAL token, significant total value locked (TVL), interoperability across multiple blockchains, support for a variety of digital assets and wrapped tokens.
7. Summer.fi
Best DeFi protocol for services
Token
Summer.fi
Token max supply
N/A
Market cap
N/A
TVL
$5.345b
Summer.fi, initially known as Oasis.app and one of the earliest MakerDAO projects from 2016, has evolved significantly beyond its original scope.
After Maker became fully decentralized, Summer.fi emerged as a standalone platform, dedicated to establishing a highly trusted application for DeFi capital deployment.
It now transcends being merely an interface for the Maker Protocol. It aims to be the most secure place for engaging with DeFi, providing users with advanced automation features like stop-loss, auto-buy, and auto-sell, as well as strategies such as Constant Multiples for optimizing Vault performance. If your Vault’s collateralization ratio hits your Sell Trigger, Constant Multiple will execute.
Summer.fi prioritizes user experience, offering clear insights into positions, returns, and associated risks, backed by a comprehensive knowledge base reflecting community feedback.
Pros
Comprehensive DeFi services Advanced automation features, (stop-loss, take-profit, auto-buy, etc.) User-friendly interface Integration with multiple protocols (Aave and Maker) Cons
Complex for new users Limited to ERC-20 tokens Borrowing features: Flexible repayment schedules, diverse collateral types, integrated with multiple protocols like Aave and Ajna, protection against market volatility through the Oracle Security Module and constant updates from Chainlink.
Multiplying features: Increase or decrease collateral exposure in one transaction, use borrowed funds to buy more collateral, integration with liquid platforms and the 1inch DEX aggregator for best execution prices, dedicated interface for managing positions.
Earning features: Self-custody solutions for yield earning, compatibility with Aave and Maker protocols, increase yield from StETH, participate in the Dai Savings Rate for passive income.
Automation features: Stop-loss to prevent liquidations, take-profit for efficient exits, auto-buy and auto-sell for Vault management, Constant Multiple to maintain predefined exposure levels.
Integration and partnerships: Support for various wallets like MetaMask and Ledger, integration with the 1inch Network for efficient token swaps, launched on Optimism layer-2 for reduced transaction costs, Ajna Protocol integration for curated borrowing and lending pools.
8. Aave
Best DeFi protocol for liquidity
Token
AAVE
Token max supply
16,000,000 AAVE
Market cap
$1.711B
TVL
$10.564B
Aave (AAVE) is a pioneering entity in the DeFi sector. The comprehensive lending platform boasts a significant Total Value Locked (TVL), which surpasses $10 billion in crypto collateral.
Aave enables users to lend and borrow a wide array of tokens across multiple ecosystems, ensuring a versatile and inclusive financial experience.
The platform’s latest iteration, Aave V3, expands its reach beyond Ethereum to include 10 different blockchain networks, further solidifying its position as a key player in DeFi by enhancing accessibility and providing a range of options for its diverse user base.
Pros
High TVL Wide range of tokens Multi-chain accessibility Flash loans availability Governance via AAVE token Cons
Complexity for beginners High gas fees on Ethereum Risk of liquidation Trade features: Flash loans, real-time interest accrual, stable and variable interest rates, Ethereum network integration, multi-asset collateral support.
Earning features: aTokens for deposit interest, decentralized lending and borrowing, yield optimization strategies, liquidity mining.
Security features: Over-collateralization of loans, smart contract audits, safety module for risk mitigation, bug bounties for platform integrity.
Platform and ecosystem features: Governance via AAVE tokens, layer-2 solutions for reduced fees, decentralized autonomous organization (DAO) structure, no KYC requirements, multi-chain accessibility.
9. MakerDAO
Best DeFi protocol for generating a stablecoin
Token
MKR
Token max supply
1,005,577 MKR
Market cap
$2.686B
TVL
$7B
MakerDAO is a pioneering DeFi platform that has revolutionized the way users engage with digital assets. The platform provides a decentralized borrowing and lending system with its stablecoin, DAI, at the core.
Built on the Ethereum blockchain, it allows users to leverage a variety of cryptocurrencies as collateral to generate DAI, maintaining stability through rigorous governance by MKR token holders.
The platform distinguishes itself with features like over-collateralization to ensure loan security, and a dual-rate model offering users the choice between stable and variable interest rates. However, users must navigate complexities such as liquidation risks and market volatility.
As MakerDAO evolves, it continues to solidify its status as a cornerstone of the DeFi landscape with the introduction of upgrades like V3 and the addition of the GHO stablecoin — balancing user empowerment with the intricate dynamics of decentralized finance.
Pros
Decentralized lending DAI stability Ethereum-based Governance by MKR Over-collateralization Variable interest rates Cons
Complexity High gas fees Liquidation risks Trade features: Flash loans, stable and variable interest rates, real-time aTokens, multi-currency collateral, governance-driven updates.
Earning features: Interest on deposits, participation in governance, yield farming opportunities, dynamic interest rates.
Security features: Over-collateralization, liquidation mechanisms, community governance for risk management, security modules for asset protection.
Platform and ecosystem features: Decentralized borrowing and lending, Ethereum-based, MKR token for governance, integration with multiple crypto assets, open-source development, Maker Vaults for asset management.
10. Compound Finance
Best DeFi protocol for staking
Token
COMP
Token max supply
10,000,000 COMP
Market cap
$487.27M
TVL
$2.668B
Compound Finance is a prominent decentralized lending platform operating on the Ethereum blockchain, known for pioneering the DeFi lending space.
Established by Robert Leshner and Geoffrey Hayes in 2018, Compound simplifies the process of borrowing and lending cryptocurrencies without intermediaries, allowing over $2 billion in assets to be locked on its platform.
Unique for its innovations, such as yield farming and governance through COMP tokens, the platform aims to provide financial inclusion, eliminating traditional transaction minimums and credit checks.
While offering competitive returns through real-time interest rates, users engaging with Compound and its governance token, COMP, must be cautious of market volatility and conduct in-depth research prior to investment.
Pros
Decentralized borrowing and lending No transaction minimums User-friendly interface Supports multiple ERC-20 assets Yield farming opportunities Cons
Market volatility risks Requires over-collateralization Complexity for new users High gas fees on Ethereum Trade features: Real-time interest rate adjustments, supports diverse ERC-20 tokens, and a user-centric lending and borrowing system.
Earning features: Yield farming with COMP tokens, competitive APR for lenders, dynamic interest rates based on market conditions.
Security features: Extensive security audits (Trail of Bits, OpenZeppelin), economic risk analysis by Gauntlet, transparent and verifiable contracts.
DeFi and ecosystem engagement: Decentralized governance with COMP tokens, financial inclusion without traditional verifications, continuous platform innovation and updates.
11. Lido
Best DeFi protocol for ETH staking
Token
LDO
Token max supply
1,000,000,000 LDO
Market cap
$2.215B
TVL
$34.445B
Lido Finance is a DeFi staking protocol offering user-friendly, semi-custodial staking services across multiple cryptocurrencies. Known for its simple interface and decentralized structure, Lido allows users to stake their assets and receive liquid staking tokens, such as stETH, which can be utilized in the broader DeFi ecosystem for yield farming.
Supported by major players in DeFi and endorsed for its reasonable fees and rewarding referral program, Lido maximizes decentralization through its governance token, LDO, allowing stakeholders to partake in decision-making. While Lido streamlines the staking process, users should consider the semi-custodial nature, the staking rewards fees, and potential tax implications associated with rewards.
Semi-custodial service Staking rewards fees Potential tax implications Staking features: Easy and unrestricted staking, maximized earning potential, liquid staking tokens for yield farming.
Earning features: Daily staking rewards, assets used as collateral for lending and yield farming, participation in governance for reward optimization.
Security features: Smart contracts audited by Quantstamp and Sigma Prime, semi-custodial nature maintains user control.
DeFi and ecosystem engagement: Governance via LDO tokens, broad DeFi integration, supports multiple blockchains including Ethereum.
DeFi protocols comparedProtocolTypeTVLTokenNo. of blockchains supportedPancakeSwapDEX$2.224BCAKE9UniswapDEX$5.543BUNI8CurveDEX$2.486BCRV14BalancerDEX$1.242BBAL8Summer.fiDEX$5.345bsummer.fi4AaveLending$10.564BAAVE12MakerDAOLending$7BMKR1CompoundLending$2.668BCOMP4dYdXDEX$401.81MdYdX1LidoStaking$34.445BLDO5De.FiTracker and walletn/aDEFI15What are DeFi protocols?DeFi protocols are sets of rules, procedures, and codes that govern decentralized finance (DeFi) systems, enabling users to engage in activities such as trading, lending, and staking tokens within blockchain ecosystems.
DeFi represents a paradigm shift leveraging blockchain technology, primarily Ethereum, to cultivate an open, permissionless, and borderless financial ecosystem. Unlike traditional systems, developers write smart contracts to deploy DeFi protocols that enable peer-to-peer interactions without intermediaries. By adhering to the same set of rules, DeFi protocols ensure a standardized experience for all participants.
An example of a DeFi protocol is MakerDAO. The popular DeFi lending platform allows users to borrow against their crypto assets by locking them in exchange for a stablecoin, DAI, thus offering more predictable repayment terms despite the volatility of crypto markets.
Other protocols allow you to earn a passive income by generating yield from your staked assets. One popular example is the Lido protocol, which allows you to earn on stETH. Platforms like Lido aim to offer the highest APY on crypto staking, allowing users to maximize returns on their staked assets within the Ethereum ecosystem.
The total value locked (TVL) is often used as a metric to gauge a protocol’s adoption and utility, with MakerDAO being one of the largest by TVL, highlighting its significant role in DeFi.
In 2026, new and more efficient technologies are being developed. For instance, some protocols incorporate asynchronous smart contracts, which allow transactions and agreements to be executed without needing all parties to be present or online simultaneously. This helps streamline operations within networks like Ethereum.
According to DeFiLlama, the top protocol categories are lending, DEXs, bridges, CDP (protocols that mint their own stablecoin using collateralized lending), and restaking.
Protocol categories: DeFiLlamaWhy do you need DeFi protocols?DeFi allows decentralized apps (DApps) and platforms to provide services like crypto lending and crypto yield earning through staking. Users can participate in AMM (automated market maker) systems to improve liquidity.
These features offer a fertile ground for startups to innovate beyond conventional financial products, fostering rapid experimentation and potential disruption. The global accessibility facilitated by DeFi platforms makes them a significant tool for financial inclusion, allowing startups to reach a worldwide audience.
The interoperability among various DeFi protocols enhances this further, enabling seamless integration of services like web3 gaming and metaverse tokens, broadening the scope of what blockchain startups can achieve.
The total value locked (TVL) in DeFi platforms serves as a metric of trust and utility, indicating the number of cryptocurrencies staked, lent, or committed to liquidity pools, highlighting the ecosystem’s growth and stability.
By eliminating intermediaries, DeFi significantly lowers transaction costs, making it an attractive model for startups, especially in crypto lending and yield generation. Instead of being worried about your credit score, you can apply for a crypto loan with fewer restrictions than in TradFi. This reduction in costs, combined with the potential for high crypto yield through mechanisms like staking, positions DeFi as an increasingly popular option for both entrepreneurs and investors in the crypto market.
How do DeFi protocols work?DeFi protocols function by leveraging blockchain technology. While most of them are based on Ethereum, some may also support other networks. At the heart of these services are smart contracts, self-executing contracts with the terms of the agreement directly written into code, which facilitate, verify, and enforce the negotiation or performance of a contract.
DeFi, however, requires thorough research and understanding of several factors, including security, liquidity, and the platform’s governance structure. It’s important to assess the user experience, the degree of interoperability with other DApps and blockchain systems, and the level of community involvement in decision-making processes.
1. Decentralized apps (DApps)Users can engage with various DeFi platforms or DApps to access a wide range of financial services.
One common way to participate is through crypto lending on platforms. Protocols such as Aave or Compound allow you to deposit cryptocurrencies to earn interest. The earnings are measured as Annual Percentage Yield (APY), which is a volatile percentage that corresponds to the market’s demands.
2. Liquidity miningAnother popular DeFi activity is liquidity mining. You can provide liquidity to decentralized exchanges (DEXs) by depositing your assets into liquidity pools. This deposit is usually made for a pair of assets, such as ETH-USDT, but it can be anything else.
In return, you earn rewards, often in the platform’s native tokens. This process is critical for ensuring there is enough market liquidity for trading and is facilitated by AMMs, algorithms used by DEXs to determine the price of tokens and facilitate trades.
3. Swaps (trading)Trading on DEXs is another key function of DeFi protocols. These platforms allow users to trade cryptocurrencies directly with others in a more private and accessible manner than on centralized exchanges.
This not only supports the decentralized ethos of blockchain but also contributes to the Total Value Locked (TVL).
Should you use DeFi protocols?Pros Earn money: You can make your crypto work for you. Put your assets in DeFi platforms to earn interest or rewards. Trade easily: Swap cryptocurrencies directly with others. No need for a middleman. More control: You’re in charge of your money. No bank or institution can block your transactions. Open to everyone: Anyone with an internet connection can join. It’s global and inclusive. Transparent: Everything is recorded on the blockchain. You can see all transactions. New opportunities: Explore new financial services like crypto lending or web3 gaming. Cons Risky: Crypto values can change fast. Your investments can shrink quickly. Complicated: Some DeFi stuff is hard to understand. It’s not always beginner-friendly. Security issues: Hacks happen. If a DeFi platform gets attacked, you might lose your money. No customer support: If you have a problem, there’s no customer service to call. Research needed: You need to do your homework before investing. Not all platforms are safe. High fees: Sometimes, you’ll pay a lot to make transactions, especially when the network is busy. Could DeFi replace traditional finance?Decentralized finance has the potential to usurp traditional institutions, specifically TradFi. Decentralized finance enables users to transact securely, anonymously, and efficiently and is thus likely to gain popularity as web3 and crypto adoption grows. From crypto lending to staking to market makers, DeFi is exciting but also risky.
Do not interact with any DeFi protocols until you have developed a solid plan and are entirely comfortable with the mechanisms of the platform. Always be aware of the potential for losses, and never invest more than you can afford to lose.
Frequently asked questions What is the most popular DeFi protocol? The most popular DeFi protocol is often considered to be MakerDAO. It frequently leads in terms of Total Value Locked (TVL) and has a wide usage across the DeFi ecosystem. MakerDAO’s platform revolves around the generation of DAI, a stablecoin pegged to the U.S. dollar, and enables decentralized borrowing and saving. Its popularity stems from its innovative approach to maintaining currency stability and providing a decentralized credit service.
What are the top five DeFi tokens? The top five DeFi tokens typically include Maker (MKR), Aave (AAVE), Compound (COMP), Uniswap (UNI), and PancakeSwap (CAKE), based on their market capitalization and impact on the DeFi space. These tokens facilitate governance of their respective platforms, offering holders voting rights on decisions and upgrades. They are integral to the operations of these platforms, from lending and borrowing to providing liquidity and facilitating decentralized trading.
What is TVL in DeFi protocols? Total Value Locked (TVL) in DeFi protocols refers to the total amount of assets currently being staked, lent, or deposited within a DeFi protocol’s smart contracts. It serves as a metric to gauge the overall health and growth of the DeFi market, indicating how much money is actively used in these decentralized financial services. A higher TVL suggests greater user trust and utility of the DeFi ecosystem.
How many DeFi protocols are there? The number of DeFi protocols is constantly growing as the space evolves and new projects are launched. There are hundreds of DeFi protocols across various blockchains, catering to different aspects of decentralized finance such as lending, borrowing, trading, and liquidity provision. The exact number can vary daily due to the dynamic nature of the crypto and DeFi industries.
How many DeFi protocols are there? The number of DeFi protocols is constantly growing as the space evolves and new projects are launched. There are hundreds of DeFi protocols across various blockchains, catering to different aspects of decentralized finance such as lending, borrowing, trading, and liquidity provision. The exact number can vary daily due to the dynamic nature of the crypto and DeFi industries.
Is TVL a good metric? TVL is a good metric for understanding the scale and usage of a DeFi protocol, as it reflects the total capital committed by users. However, it should not be the sole metric for assessing a protocol’s value or success, as it does not account for risks, decentralization level, or liquidity. It’s best used in combination with other factors like user growth, transaction volume, and protocol governance for a comprehensive evaluation.
What is a good FDV TVL ratio? A good FDV (Fully Diluted Valuation) to TVL (Total Value Locked) ratio for a DeFi project is typically below one, indicating that the project’s market valuation is not excessively higher than the value of assets locked in the protocol. Lower FDV/TVL ratios suggest that the protocol is undervalued or efficiently using its capital, which can be attractive to investors. However, this ratio should be considered alongside other metrics and project fundamentals for a complete analysis.
What is the TVL formula? The TVL formula in DeFi protocols calculates the total value of all assets deposited in the protocol’s smart contracts, which can include cryptocurrencies, stablecoins, and other tokens. It aggregates the value of these assets, often converting them to a common currency like USD for a standardized measure. The formula is the sum of the value of each type of asset multiplied by its current market price.
How to calculate FDV? The Fully Diluted Valuation (FDV) is calculated by taking the total supply of a token (both circulating and non-circulating) and multiplying it by the current price of the token. This gives an idea of what the market cap would be if all tokens were in circulation and trading at the current price. It’s an important metric for understanding the potential market size and investment risk of a cryptocurrency or DeFi project.
Chainlink continues to strengthen its dominance within the oracle economy as adoption of its Smart Value Recapture (SVR) solution accelerates across the DeFi ecosystem. With decentralized finance increasingly reliant on accurate, secure, and tamper-resistant data feeds, Chainlink remains at the center of this infrastructure layer, powering a growing share of on-chain applications.
Why SVR Could Become A Major Revenue Layer For Chainlink Since Chainlink launched, Smart Value Recapture (SVR) has rapidly become the dominant solution for capturing oracle-related Maximal Extractable Value (MEV), now commanding an estimated 99% market share. Crypto analyst Zach Rynes highlighted on X that the system has been widely adopted by the largest DeFi lending platforms such as Aave, Compound, Venus, and various Morpho markets.
At its core, the SVR exclusively recaptures the non-toxic liquidation MEV of value that would have leaked to Layer 1 validators and searchers during DeFi loan liquidations. The scale of adoption is already producing significant results. SVR has reportedly generated approximately $18.7 million in revenue, distributing approximately $12 million back to integrated DeFi protocols while contributing $6.7 million to Chainlink, including support for LINK buybacks.
Meanwhile, the system efficiency is reflected in its consistent recapture rate of about 85%, meaning SVR recaptures the $85 from every $100 liquidation bonus made available. It has already processed over $700 million in liquidation volume on Aave alone, without generating bad debt, even during periods of heightened volatility such as October 10. Additionally, it also features the largest and most decentralized ecosystem of independent searchers, with over 115 independent liquidators. Competition ensures solvency and drives up recapture rates.
SVR marks a major shift in the Chainlink business model, enabling it to directly monetize the total value it secures across DeFi applications, in addition to monetizing the integration, usage, and maintenance of oracle services by blockchains via the Scale program. In this context, SVR is a powerful new economic engine that reinforces the Chainlink position at the center of decentralized finance.
Chainlink’s Staking Model Awaits A Clear Regulatory Framework The Chainlink staking ecosystem could be approaching a pivotal moment as the crypto industry moves closer to greater regulatory clarity. According to analyst LinkBoi, the current Clarity Art is limiting Chainlink’s ability to expand staking pool rewards distribution within the network.
Currently, stakers are receiving incentives primarily through allocated token emissions rather than a share of protocol-generated revenue. The staking pool expansion requires permission to pay stakers a portion of the protocol’s revenue.
However, if the Clarity Act provides the necessary legal clarity, it would unlock a major opportunity for the LINK token to be considered as a security. The staking pool could expand significantly, bringing the full LINK tokenomics ecosystem into effect.
LINK trading at $9.5 on the 1D chart | Source: LINKUSDT on Tradingview.com Featured image from Pngtree, chart from Tradingview.com
