Chainlink has announced that it now offers price reference data for more than 25 trading pairs. These kinds of feeds are vital for decentralized finance applications.
As of today, Chainlink’s list includes data on 16 Ethereum trading pairs and nine USD trading pairs. Notable trading pairs include ETH/USD, BTC/USD, and EUR/USD.
So far, three sites have integrated Chainlink’s data. Synthetix, an asset backing platform, is supporting USD trading pairs. Meanwhile, the lending platform Aave is supporting ETH pairs. Loopring has also added support for one pair in each category.
This development marks a significant expansion for Chainlink: until recently, the platform only offered price data for seven trading pairs.
Now, Chainlink’s data collection is the largest of its type, according to the project itself.
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How It Works Unlike CoinMarketCap and other market aggregators, Chainlink does not gather its data from exchanges. Instead, it gathers data from independent node operators.
These node operators are given incentives to provide accurate data. They also undergo security reviews and are resistant to Sybil attacks that could disrupt reporting.
This means that the data can be audited and verified for accuracy and integrity. It is possible to do so simply by visiting the project’s website.
In the image below, Chainlink shows which data sources are online and displays the time of the next update. Ethereum’s average price is shown in the center:
Via Chainlink The Importance of Oracles As Chainlink has noted, decentralized finance (DeFi) services require reliable access to market data in order to execute transactions and to swap assets.
Though some DeFi services can make use of basic on-chain data, that option is not practical for the vast majority of services. “Obtaining the most reliable price for an asset requires aggregation from multiple off-chain data sources,” Chainlink explains.
That is precisely the role that Chainlink provides as an oracle provider, along with other comparable platforms such as Aeternity and Band Protocol.
Of course, the fact that oracles require strict data handling means that they are not comprehensive. Though Chainlink may be the largest oracle platform, it offers far less data than market aggregators, which track price data for thousands of assets.
However, as demand for DeFi grows, it is likely that demand for oracles will grow along with it — and Chainlink is by far the top-performing project in its category.
Disclosure: This article was edited by Mike Dalton. For more information on how we create and review content, see our Editorial Policy.
DeFi tokens have not witnessed any massive price change over the past few week. For instance, the likes of Uniswap, Marker and PancakeSwap rallied by only 10%, 8% and 2.3% respectively, in the aforementioned time window. However, tokens such AAVE and YFI, managed to appreciate slightly higher [17% each], successfully demonstrating their strength.
However, the question remains, as to whether or not these two tokens would be able to carry on their respective rallies.
Market Sentiment The market has been quite favorable to traders advocating the price-drop narrative and the long-short liquidation data supported the aforementioned claim. Over the past 12 hours, $270k worth of YFI long contracts were liquidated when compared to the mere $56k worth of short contracts.
Source: ByBt With AAVE too, $851k worth of long contracts were forcefully closed, when compared to the mere $129k worth of short contracts. The funding rate on all major exchanges, for both the tokens, was negative at the time of writing, thus intensifying the bearish sentiment.
Additionally, the OI data revealed another not-so-healthy trend. Even though the number of outstanding derivative contracts witnessed a slight spike of late, they were nowhere near their pre-set benchmarks. As seen from the chart attached, YFI’s OI peaked at $137.2 million during May this year, while its current value [$54.08 million] is not even half of the same. AAVE’s OI too, for that matter, has to bridge a gap of close to $90 million to reach its previous peak.
Source: ByBt On-chain setbacks The state of on-chain metrics for both these tokens also remained unsatisfactory. For starters, less than one-fourth of the addresses that were active during the initial few months of the year, for both YFI and AAVE, were active at press time. The decreased participation, by and large, points out the fragile state of their respective blockchain’s activity.
Further, the balance on exchanges have been gradually increasing. In fact, they’ve been depicting contrasting trends when compared to their previous rallies. A day back, for instance, more than 16.4k AAVE tokens were sent to exchanges, outlining the fact that participants were gradually cashing out.
Source: Glassnode Well, it is quite obvious that the rallies of both these DeFi tokens lack momentum. Ergo, without the same re-entering their respective markets, traders shouldn’t expect any unreasonable pump. The next few days would indeed, test the resilience of these two tokens.
Uniswap, AAVE, Maker, and Yearn.Finance are some of the best performing DeFi assets existing in the space at the moment. While DeFi has grown monumentally over the past few months, with Cardano releasing its smart contracts mainnet today, the excitement is unmatched. Even so, the market has seen a significant drop in DeFi’s value. And with it, these altcoins took a hit as well.
DeFi goes down Total value locked in DeFi this week fell hard dropping by about $11 billion, from $98 billion. This is not necessarily new, as this has occurred twice this year earlier after a bull run, first in Feb then May. In February it fell by $18 billion and in May it fell by $19 billion.
However, at $87 billion, it was still way higher than ever before, so there isn’t much to worry about there.
DeFi TVL in the past | Source: DeFi Pulse – AMBCrypto In accordance with the drop in TVL, the DeFi Pulse Index (DPI) fell by 16.62% at press time. At its worst, it plunged by 24.01%. The worry although is when it came to the top-performing DeFi assets such as Uniswap (UNI), AAVE, Maker (MKR), and Yearn.Finance (YFI).
In the last 5 days, each of these tokens dropped over 20%. Uniswap witnessed the highest fall of all, as it went all the way down to 26.86% (UNI)
Uniswaps 26% fall | Source: TradingView – AMBCrypto So which asset is the best? Even though UNI fell the most, it was also the strongest in terms of network performance. MVRV ratio and the network value to transactions showed stark dominance of Uniswap over the other altcoins.
MVRV of the assets | Source: Coinmetrics – AMBCrypto As for investor participation, once again UNI lead, followed by AAVE, YFI, and MKR. Uniswap is once again the best performer, both in terms of daily active addresses and transaction numbers.
Active Address for the coins | Source: Coinmetrics – AMBCrypto But in terms of profitability, the ranks changed. MKR is the most profitable option at the moment with YFI and UNI following it. Here AAVE came out as a bad asset since its profitability is a mere 37%.
AAVE’s profitability is at 37% | Source: Intotheblock – AMBCrypto However, here are the latest updates. UniCode hackathon event announced for the Uniswap community. Maker Foundation moved to dissolve itself in order to give way to a completely decentralized network. Lastly, $868k earnings reported by YFI in Q2, through yield farming treasuries.
These were helping the price rise and make the 3 alts, a better choice of investment. So AAVE, may be the one here to stay away from.
Aave’s stablecoin GHO struggled to maintain its $1 peg. Aave Governance took steps to reduce GHO’s supply and address its pegging issues. Aave [AAVE]’s stablecoin GHO faced challenges in maintaining its peg at $1 since its launch in mid-July. The main cause of its struggle could be attributed to one particular trading strategy – the carry trade.
Is your portfolio green? Check out the AAVE Profit Calculator
Under this strategy, traders borrowed GHO at a low rate of 1.51% and sold it for another stablecoin, typically DAI. They then deposited this stablecoin into yield-bearing opportunities, generating sell pressure on GHO and pushing its price below $1.
Aave’s GHO stablecoin has remained depegged since its July launch, currently trading at $0.974.
The cause?
GHO is on the 'short' side of a carry trade where traders:
1. Borrow GHO cheaply (@ 1.51%)
2. Sell for stablecoin (typically DAI)
3. Deposit stablecoin into yield… pic.twitter.com/mUUFIBwjiA
— Messari (@MessariCrypto) September 11, 2023
Steps to address the issue To address GHO’s pegging issues, Aave Governance took action through two governance proposals. The first proposal, titled “GHO update on Aave V3 Ethereum Pool,” reduced the stablecoin’s borrowing cap on the Aave V3 Ethereum [ETH] Pool from 100 million to 35 million.
The second proposal, titled “Increase GHO Borrow Rate,” aimed to raise the borrowing rate for GHO from 1.5% to 2.5%.
Both proposals were targeted towards a reduction in the supply of GHO. The first explicitly achieved this by reducing the borrowing cap, while the second aimed to implicitly reduce supply by making borrowing more costly.
However, it’s crucial to understand that these measures alone might not fully restore GHO’s peg. According to Messari’s data, stablecoin prices hinge on the fundamental principles of supply and demand.
If demand surpasses supply, a stablecoin’s price can exceed $1. In GHO’s case, however, oversupply has pushed its price below this mark.
Aave’s network growth sustains Despite Aave’s proactive efforts, its network growth was on the decline at press time. This suggested that new addresses showed a decreasing interest in GHO.
The AAVE token also experienced a decline in its price.
Source: Santiment Realistic or not, here’s Aave’s market cap in BTC’s terms
Nevertheless, amidst GHO’s struggles, the Aave protocol continued to exhibit high levels of activity. Notably, daily active users for the protocol surged by 32.9% over the last month.
Additionally, the protocol’s revenue witnessed substantial growth, with a 43.9% increase in the last 24 hours.
A ranking of top coins placed Aave at the top of the social activity ranking. AAVE has been trending upward for almost two weeks. A recent data analysis that assessed social activities across the internet has positioned Aave [AAVE] at the top of the rankings. Given this latest ranking, what is the current status of its social engagement and price trends?
How much are 1,10,100 AAVEs worth today?
Aave tops social rankings Lunar Crush’s recent ranking has placed Aave as the foremost asset in terms of social activity across the internet. This ranking was determined by comparing its social activity to itself, using data collected from various sources on the web.
Top ten coins average LunarCrush Galaxy Score™ this week:
Galaxy Score™ constantly measures a coin against itself with respect to the social activity metrics pulled in from across the web.https://t.co/flocI9jDEP pic.twitter.com/667al3g3v7
— LunarCrush (@LunarCrush) September 22, 2023
How do Aave’s social metrics stack up? As per the social dominance metric provided by Santiment, discussions regarding Aave have remained relatively low, failing to surpass the 1% mark for nearly seven months.
At the time of this writing, the social dominance chart displayed indications of an upward trend, sitting at approximately 0.05% after initially declining to around 0.03%.
Source: Santiment Furthermore, the social volume did not show signs of significant improvement, and it also experienced a decline. As of this writing, the social volume was around three, although it might experience an increase before the day concludes.
Spike in active addresses? An examination of Aave’s 24-hour active addresses revealed that there has not been any notable surge in active addresses over the past 24 hours. Instead, it exhibited typical activity levels. At the time of this report, there were approximately 573 active addresses.
Source: Santiment Furthermore, when inspecting the active addresses chart for V3, it becomes evident that there has not been any significant activity either. As of this writing, a decline in active addresses was noticeable, with approximately 82 active addresses.
AAVE on a roll Examining the daily timeframe chart of Aave revealed an interesting trend. Over nearly two weeks, it has closed trading at a loss only once. This loss occurred on 21 September, resulting in a decline of over 4.5% in its value.
However, Aave quickly recovered some of these losses on 22 September, closing with a gain of over 3% in value. These consecutive uptrends translated to an impressive overall gain of approximately 18% in value in less than two weeks.
The positive performance could be a contributing factor to its high Lunar Crush social ranking.
Source: TradingView Is your portfolio green? Check out the AAVE Profit Calculator
Nevertheless, as of this writing, it was trading at a slight loss, although it was less than 1%, with a price of approximately $63.8. It’s important to note that this decline has not been significant enough to disrupt its ongoing bullish trend.
Additionally, as of this writing, the Relative Strength Index (RSI) line was trending above 60, indicating a relatively strong position in the market.
Curve founder Michael Egorov has deposited 68 million CRV tokens ($35 million) to settle his entire debt position on DeFi lending platform Aave, according to blockchain analytics firm Lookonchain.
After depositing CRV, Egorov converted 10.77 million crvUSD to tether USDT$0.9988 to repay all of the debt on Aave.
CRV is currently trading at 53 cents having risen by 3.48% in the past 24-hours, according to CoinDesk data.
In August, Egorov raised $42 million through over-the-counter (OTC) sales of CRV tokens to pay off $80 million of on-chain debt, this came after a market-wide tumble in asset prices which put Egorov's CRV positions on DeFi lenders dangerously close to liquidation.
In the event of liquidation, Aave would have had to sell the CRV put up as collateral to the open market, which would have had a cascading effect due to a lack of liquidity.
Now, Egorov has 253.67 million CRV tokens ($132.52 million) in collateral and $42 million in debt across four DeFi lenders, according to Debank.
Aave enjoys strong network activity as the market experiences a bullish frenzy. AAVE bears may get a chance to take the wheel as the bulls take a break following an intense week. Now that the markets have been recovering after previously experiencing a low liquidity phase, DeFi demand is resuming. Aave [AAVE] has been benefitting especially in terms of utility and this is promising for its native token AAVE.
Is your portfolio green? Check out the AAVE Profit Calculator
Recent market analysis revealed a surge in Aave’s network activity in the last two days. This didn’t exactly come as a surprise considering the soaring demand for cryptocurrencies as observed in the bullish outcome during the last few days.
The observation reflected a surge in the number of transactions which stood at its highest levels observed in the last two weeks.
Using this tool to monitor tokens is really easy.
And I discovered there’s been a significant surge on the number of transactions on the AAVE blockchain in just 2 days.
Activities went up from 1.2k to 2.9k within the last two days.
This increment in Transaction number… pic.twitter.com/NDjnbS1yVZ
— Web3 Wonder (?’?) ₿ (@Onlywondergirl) October 24, 2023
The fact that Aave was experiencing strong network activity should technically fuel demand for AAVE. That appears to have been the case in the last few days given its robust rally.
Furthermore, last week we also observed a significant probability of AAVE breaking out of its wedge pattern. Fast forward to the present and that prediction was a bit too accurate.
Why a retracement could be on the cards AAVE exchanged hands at $84.65 at the time of writing. This price point was noteworthy because it represented a slight pullback from its recent monthly high. The retracement occurred after the price retested a resistance level previously observed in July.
Source: TradingView Additionally, the resistance retest suggested a significant probability that the price might extend its downside. This was further supported by the fact that the price recently pushed deep into overbought territory on both the Relative Strength Index (RSI) and the Money Flow Index (MFI). Furthermore, on-chain data also supported those expectations.
Interestingly, the latest pullback may have just saved some short sellers. This was because the pullback occurred just as the price was about to enter a peak liquidation zone. A bit more upside and short sellers would have experienced maximum pain above the $91 price level.
Source: Hyblock However, the whales could be the saving grace for short sellers. This was because on-chain data also indicated that there was a considerable amount of profit-taking from the whales. Most of the outflows observed were from addresses holding between 10,000 and 100,000 AAVE coins (green).
Source: Santiment How many are 1,10,100 AAVEs worth today
On the other hand, there was still a significant amount of accumulation coming from addresses with over 100,000 coins. This may explain why the pullback has been limited for now. In the meantime, it was worth considering the possibility that the market inclined in favor of the bulls. Hence, the possibility that AAVE could extend its rally.
Decentralized finance (DeFi) platform Aave has suspended operations in a number of markets after receiving a problem report on a certain function of the protocol.
DeFi Protocol Discovers Vulnerability; Is User Funds At Risk? On Saturday, November 4, decentralized lending protocol Aave announced – via a post on X (formerly Twitter) that it has paused the Aave V2 Ethereum market and suspended certain assets on Avalanche. In addition, the protocol has frozen specific assets on Aave V3 on Polygon, Arbitrum, and Optimism.
Today we received a report of an issue on a certain feature of the Aave Protocol. After validation by community developers, the guardian has taken the following temporary prevention measure (no funds are at risk):
— Aave (@aave) November 4, 2023
According to the protocol’s announcement, these actions serve as a temporary precautionary measure following a problem report on a specific feature.
Furthermore, Aave said in the post that the Aave V3 markets on Ethereum, Base, and Metis and the V2 markets on Polygon and Avalanche are unaffected. Meanwhile, no funds on any of the markets were at risk, according to DeFi lending protocol.
🚨🚨 🚨 On 11-04 17:38:35 UTC, Aave Guardian has taken necessary protection measurements to pause AaveV2 protocol (and all Aave pools are safe): https://t.co/3xJzfiejig
Given the protocol is “forked” by multiple third parties and the exact details are not disclosed yet, it is… pic.twitter.com/OkO1EZv6pW
— PeckShield Inc. (@peckshield) November 4, 2023
While Aave did not specify what the issue is or the feature that caused the problem, the protocol said it would release a detailed explanation once there is a full resolution. The statement read:
A governance proposal to restore the normal operation of the protocols will be submitted shortly. A detailed postmortem will be released once the issue is fully resolved.
Aave further clarified that users supplying or borrowing from a frozen assets pool can still withdraw and repay positions. However, these users can’t supply or borrow more funds from the frozen assets pool until the issue is resolved. The protocol added:
On paused assets, no action can be done until unpaused.
AAVE Price Remains Steady Despite Protocol Vulnerability There is no evidence to suggest that the problem has had any impact on the value of the protocol’s native token, AAVE. As of this writing, the token is valued at $90.15, reflecting a negligible 0.9% price dip in the past 24 hours.
Nevertheless, the token is outperforming on a bigger timeframe. Over the past week, AAVE’s price has swelled by more than 10%, touching the $100 mark – for the first time since February – at some point during the week.
Although the price of AAVE has been moving mostly sideways in the past few days, a resolution of the current issue might trigger renewed momentum for the token. Hence, there is a chance that the cryptocurrency might revisit $100 again, especially considering the optimistic climate of the crypto market.
AAVE price slows down upward momentum on the daily timeframe | Source: AAVEUSDT chart on TradingView Featured image from Binance Academy, chart from TradingView
Whale interest in AAVE rose as its price moved upward. Network Growth and velocity declined, which could affect the token in the future. Aave [AAVE] has had a tough time standing toe to toe with other prominent DeFi protocols in recent times. However, despite this, whales have shown an interest in the AAVE token.
Whales swim in As per Lookonchain’s data, a large crypto holder took out 70,000 AAVE worth $6.93 million from Binance [BNB] on the 7th of November. Over the past 24 hours, this whale had withdrawn a total of 140,100 AAVE, equivalent to $13.88 million, from Binance.
The whale withdrew another 70,000 $AAVE($6.93M) from #Binance 5 mins ago.
And has withdrawn a total of 140,100 $AAVE($13.88M) from #Binance in the past 24 hours.https://t.co/t0C1PjdqKM pic.twitter.com/vg21VK2NLg
— Lookonchain (@lookonchain) November 7, 2023
The significant withdrawal of tokens could have a widespread effect on Aave.
Positively, it might indicate that this whale investor has confidence in AAVE’s potential value, leading to a higher market price. However, such large withdrawals can also cause a temporary drop in AAVE’s price due to decreased liquidity.
On the negative side, such massive token movements can create price volatility and uncertainty in the market. It may also lead to concerns about centralization if a few large holders control a significant portion of AAVE tokens.
In the long run, Aave’s success relies on attracting a diverse user base, so extensive withdrawals by a single entity can raise concerns about decentralization and the health of the ecosystem.
As per AMBCrypto’s analysis, AAVE’s price action had been showing multiple higher highs and higher lows. This indicated that the price was slowly showcasing a bullish trend.
Moreover, at the time of writing, the token was trading at $95.972. However, the Network Growth of the token had fallen materially during this period. This implied that the new addresses were losing interest in AAVE.
If the trend continues, it would be hard for AAVE to break past its resistance levels.
The velocity of the token had also fallen. This suggested that the frequency at which AAVE was being traded had declined. The low velocity could be another factor that could hinder the progress of AAVE going forward.
Source: Santiment Realistic or not, here’s AAVE’s market cap in BTC’s terms
However, it was a positive sign that AAVE was able to maintain its bullish momentum, despite recent developments. Recently, Aave, faced a problem and had to halt certain markets on the 4th of November.
This issue affected different networks, including Aave V2 on Ethereum [ETH] and Avalanche [AVAX]. Also, assets on Polygon [MATIC], Arbitrum [ARB], and Optimism [OP] felt its impact.
Radiant Capital, a lending and borrowing protocol for users to borrow various assets across multiple chains, is rapidly closing in on Aave, looking at earnings data over the past six months.
Radiant Capital Earnings Rising: What’s The Trigger? According to Token Terminal statistics on November 8 shared by one user on X, @Flowslikeosmo, Radiant Capital generated $5.8 million in revenue despite a relatively lower level of liquidity than Aave. @Flowslikeosmo, who claims to be a crypto researcher, said Radiant Capital’s earnings will likely explode in the upcoming sessions, especially once the 2.8 million ARB begins to be deployed.
Radiant Capital earnings | Source: Token Terminal via @Flowslikeosmo on X Radiant Capital is a popular cross-chain decentralized money market through which users, regardless of their choice blockchain, can either lend their assets and earn passive income or borrow assets trustlessly. This way, the decentralized finance (DeFi) protocol has opened up liquidity and boosted access to multiple blockchains.
Related Reading: Dogecoin In Tight Zone: Why A Rally Will Happen If DOGE Clears $0.076
To perform effectively, the protocol relies on LayerZero, which enables trustless and decentralized communication between blockchains using Oracle Relays, allowing platforms to be more interconnected and ledgers to be more interoperable. As Radiant Capital offers services, the DeFi protocol generates earnings or revenue primarily from fees.
The platform charges a protocol fee on all transactions. Earnings from this allow the team to be operational while allowing the protocol to generate revenue.
However, it should be noted only 15% of this fee is used to cover operational expenditure, with the rest redistributed to users as yield. Besides, there are fees billed to users taking flash loans. The protocol rewards providers with RDNT to incentivize liquidity provision, depending on the amount provided and the duration locked.
ARB Airdrop, Will RNDT Rally To New 2023 Highs? Earnings generated depend on the activity level, directly influencing protocol fees accrued and the number of users taking flash loans. Following Radiant Capital’s recent announcement that it plans to airdrop 2 million ARB following the Arbitrum DAO‘s approval of a proposal first floated in late September, activity could skyrocket in the coming months, boosting earnings.
Moreover, the protocol’s liquidity is expected to increase with this approval. The ARB airdrop will be used to incentivize liquidity provision. Additionally, Radiant Capital will strike more partnerships, allowing it to expand to other chains, including Ethereum and Arbitrum.
Radiant Capital price trending upward on the daily chart | Source: RDNTUSDT on Binance, TradingView According to Dune Analytics data, the number of RDNT holders continues to rise, mirroring its general price performance. Thus far, RDNT is up 40% from October lows. The immediate resistance level at $0.33 must be broken for the coin to rally, even registering new 2023 highs.
An Aave whale now holds over 2% of the total circulation. AAVEs’ positive trend continues with an over 4% price increase. Recently, Aave has witnessed substantial individual accumulation from a prominent whale. Notably, this whale has achieved a remarkable record in terms of the total volume of the token they have amassed.
On the 9th of November, Spot On Chain detected a noteworthy transaction involving Aave. This transaction revealed that a whale had just withdrawn 64,557 AAVE tokens, with an approximate value of $6.7 million.
Further examination of the whale’s wallet unveiled that they had made withdrawals amounting to 338.794 tokens in the last two days, with a combined value of roughly $34 million.
As of the latest available information, this whale has become the largest individual holder of Aave tokens. The whale currently possesses 2.12% of the total token supply.
According to data from CoinMarketCap, the total supply of Aave tokens is reported to be 16 million.
Aave having a good run The daily timeframe chart revealed a strong upward price movement for Aave over the past 48 hours. As of the close of trading on 8th November, the price had surged by more than 2.7%, reaching approximately $1.4.
At the time of this update, the value had risen even further, surpassing $1.5 with a gain of over 4%.
Also, this recent price surge has driven the Relative Strength Index (RSI) into the overbought zone. This indicates significant buying pressure and a prevailing bullish trend.
Source: TradingView Additionally, an analysis of the Moving Average Convergence Divergence (MACD) revealed it was trending above zero. This alignment with the RSI’s bullish signal reinforces the overall positive sentiment in the market.
Is the derivative market also sharing this sentiment?
Positive sentiment on the derivative side? Based on data from Coinglass, the funding rate for Aave has reflected a positive sentiment among traders. The funding rate chart showed that traders were anticipating a future price increase, making the funding rate remain positive. At the time of this update, the funding rate was approximately 0.06%.
Realistic or not, here’s AAVE’s market cap in BTC terms
However, it’s worth noting that the chart also indicates a decline in the funding rate.
It suggests that fewer traders are taking long positions. This might be due to expectations of a price decrease or reduced overall interest in doing so.
Stani Kulechov, founder and CEO of Aave, in 2019. (CoinDesk)Lens Protocol, a decentralized social media platform a sister project to the lending protocol Aave, has released its "V2" upgrade on Polygon's main network – introducing a range of new features including multisig-managed profiles and tipping on "smart posts."
Lens is among a handful of blockchain-oriented startups aiming to capitalize on what experts have characterized as drawbacks of so-called "Web2" social-media platforms managed by big centralized companies such as Facebook and Elon Musk's X (formerly Twitter). "Web3" is the catch-all term for decentralizing these projects with blockchain technology.
“The goal of V1 was to bootstrap early Web3 social networks, resulting in creativity, experimentation and new discovery tools that benefited the Lens ecosystem," Aave founder Stani Kulechov, who also serves as CEO of Lens Protocol, said in a press release.
Lens V2, he said, moves "progressively towards a more modular" design, giving users "greater autonomy and flexibility" in their social media experiences. This could eventually include things like being able to move around your "social graph" (a term of art for your following and followers) between interactive platforms.
Unveiled in February 2022, the Lens project raised $15 million from investors including IDEO CoLab Ventures, General Catalyst, Blockchain Capital and Palm Tree as well as individual contributions from Uniswap CEO Hayden Adams, OpenSea co-founder Alex Atallah, entrepreneur Balaji Srinivasan and Polygon co-founder Sandeep Nailwal.
According to the press release, the Lens upgrade introduces new features including Profile Manager, which "allows Profiles to be managed by one or more persons, multisigs and DAOs," along with Handles, which creates another identity layer that distinguishes “profiles” from “handles” on the platform.”
Another feature is "Pay to read the rest" where developers can post previews of posts and then set payment options to read the entire piece, which seems to draw influence from the paid “subscriber” feature on X/Twitter. Lens "smart posts," another way to monetize content using the protocol, supports tipping, voting, subscribing and donating.
SponsoredUpdated Mar 8, 2024, 5:42 p.m. Published Nov 28, 2023, 10:42 p.m.
3 min read
Sometimes it takes a dictator to get things done in decentralized finance. At least, that seems to be the case for Aave's stablecoin GHO.
The asset, which has been valued at less than $1.00 for nearly all of its life, gained ground this week and rallied to $0.985 for the first time since August. Its volatile gains aren't doing anything to fix GHO's reputation as a not-so-stablecoin, but they do set the token close to the levels one might expect from an asset that's supposed to be worth a dollar – not $0.96.
The higher price price matches the target set by the hands-on DeFi engineer who insiders have called GHO's "benevolent temporary dictator," TokenBrice. This month the pseudonymous Frenchman took over the liquidity committee Aave tasked with restoring GHO's dollar peg. He then embarked on an "ambitious gamble" to at least get GHO halfway there by Nov. 30.
Getting GHO on peg is no easy task because the stablecoin doesn't work like others do. It lacks a redemption mechanism that usually ensures these assets maintain a lower bound. And the interest rate is controlled by Aave governance, another possible negative in borrowers' eyes.
TokenBrice's strategy focused on incentivizing buying support for GHO in a very targeted manner. This played out most critically on the DeFi protocol Maverick, an Automated Market Maker that offers more levers than other AMMs for controlling the liquidity of its pools.
"We are using, for the first f------ time ever in the history of Defi, liquidity shaping in an opinionated manner," TokenBrice said in an interview with CoinDesk. (He's also an advisor to Maverick).
"We don't just pay for liquidity and incentives somewhere, we pay for a very specific kind of liquidity that are biased toward the buying side, and it helps us create price support for buying pressure for GHO, and progressively push it upward."
In a Nov. 23 committee report, TokenBrice said Maverick's so-called Boosted Pools had decisive advantages for engineering liquidity compared to better-known DeFi trading stalwarts, like Uniswap.
"Far from being a panacea, the new AMM stands out as a solution to help stablecoins return to peg," TokenBrice wrote of Maverick in the report.
The Maverick solution has certainly worked for GHO, said Marc Zeller, a vocal member of the Aave community who leads the Aave Chan Initiative. He said there may be some conflicts of interests in TokenBrice implementing and singing the praises of a project he advised.
The GHO repeg "is a great ad for Maverick," Zeller said in an interview. "But let's say that from my & Aave DAO's point of view, that's a win win." He compared the situation to a "double edged sword: a failure would not have been great for Maverick."
Zeller said his ACI also had a hand in organizing the repeg. "We coordinated governance, increases to borrow rate & DAO deals."
There's more to come in GHO's road to $1, he said. For starters some Balancer pools have an excess of GHO token, and that needs to be addressed. And the token's total issuance has been capped at 35 million for months, limiting its ability to grow.
"Once we reach a critical mass of sane liquidity around peg, we will propose to the DAO a "Stop and GHO" approach to gradually increase the mint Cap of GHO allowing more assets in circulation and a virtuous circle of liquidity," Zeller said.
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Borrowing rates for USDC, one of the most liquid dollar-pegged stablecoin, remain high on Aave and Compound v2, two of the world’s top decentralized protocols. According to Kaiko, a blockchain analytics platform, rates have ranged from 4% to 15% on Aave and around 13% on Compound.
It should be noted that this surge is when the crypto and decentralized finance (DeFi) scene is recovering after an extended “winter” that froze participation.
USDC borrowing rates on Aave and Compound | Source: Kaiko on X Kaiko notes that the utilization rate for USDC on Aave has remained close to optimal levels, indicating steady demand for the stablecoin among borrowers, mainly in the second half of November. Looking at trends, it is evident that borrowing rates in Aave v2 have been stabilizing between 4% and 15% over the past week.
AAVE prices trending sideways on the daily chart | Source: AAVEUSDT on Binance, TradingView Meanwhile, on Compound v2, borrowing USDC has been more expensive than others, including USDT and DAI. The USDC borrowing rate is around 13%, much higher than borrowing Ethereum-based DAI or Tether Holding’s USDT.
There is no precise reason to explain this divergence. However, the reason why demand is varying could be multifaceted. One of the key reasons is that after depressed activity in the better part of 2022 and 2023, activity is expanding as total value locked (TVL) not only in Ethereum but in other chains, including Solana, shows.
DeFiLlama says the total TVL is around $47 billion, up from approximately $38 billion registered in mid-October. Subsequently, with rising demand, USDC holders will likely want more yield from willing borrowers.
DeFi TVL rising | Source: DeFiLlama Beyond this, increasing borrowing rates could be due to users averse to using centralized exchanges opting to secure a stablecoin that’s fully audited, publishing attestation statements regularly.
In the case of USDC, these attestations are independent audits that verify whether Circle, the issuer, holds sufficient reserves to back every token in circulation.
Are Bulls Ready To Lift Crypto Prices Higher? While the high borrowing rates for USDC may make it less attractive for some borrowers, it also highlights the strong demand for stablecoins and their growing importance in DeFi. In the crypto market, the demand for stablecoins, such as USDC, can indicate the start of a bull run.
Stablecoins provide a gateway into crypto. When there is a higher demand for these tokens, the chances of the crypto market rising also increase. As the crypto and DeFi scene matures, stablecoins like DAI and USDT are expected to play a critical role.
Feature image from Canva, chart from TradingView
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Dalmas is an experienced journalist with over a decade in Forex, general finance, technology, and blockchain developments. He is currently a crypto reporter for Bitcoinist, where he covers DeFi, blockchain, DeFi, and latest industry news. His work and that of his partners have been featured in top news outlets, including Forbes, investing.com, CoinTelegraph, and Entrepreneur, among others. He is passionate about technology and politics and is always on the lookout for the latest trends in these fields. He also loves spending time with his family and friends, exploring nature, and traveling to new places. Connect on X: @Dalmas_Ngetich, or message him directly on Telegram here: @Dalmas_Ngetich.
Updated Mar 8, 2024, 6:12 p.m. Published Dec 4, 2023, 2:12 p.m.
3 min read
Stani Kulechov (Mason Webb/CoinDesk)Stani Kulechov is the founder and CEO of Avara, the software development company behind decentralized finance (DeFi) protocol Aave; the stablecoin GHO, which launched this year; and the upstart Web3 social protocol, Lens Protocol, which recently arrived on the Polygon layer 2. The main Aave protocol upgraded to V3 this year, improving user accessibility and introducing security features.
Aave, a DeFi lending platform primarily based on the Ethereum blockchain, lets users take out instant loans denominated in cryptocurrency using other cryptocurrencies they own as collateral. It also allows users to lend out their crypto to earn returns. The smart contract-based system sets rules for how funds, collateral and fees are distributed and assessed, effectively creating a self-executing model of finance with few or no intermediaries.
This profile is part of CoinDesk's Most Influential 2023. For the full list,click here.
This isn't an easy time for DeFi players. The total value locked in DeFi protocols is about a quarter ($40 billion) of what it was at the height of the market in November 2021. Kulechov says the last year has been dedicated to building better infrastructure for DeFi, including improved accessibility and user interfaces to increase participation. "The amount of value, like, it really depends obviously on what's the need, for example, for liquidity," Kulechov told CoinDesk. "It depends on the opportunities in finance and how much there's actually access to participate as well." In other words, the amount of deposits or "total value locked" (TVL) on Aave is a function of the market as much as the performance of the technology itself.
Kulechov was born in 1991 in the former Soviet Republic of Estonia, before his family emigrated to Finland and settled in Helsinki amid the economic crisis that followed the Soviet Union's collapse. In 2015, while at Helsinki University School of Law, he came across Ethereum and started learning about smart contracts. Kulechov built "ETHLend," the precursor to the Aave Protocol, while in his dorm room at the same university. Kulechov now lives in London, where Avara is based.
In 2024, Kulechov expects to see further expansion of staking (which had a breakout year in 2023) and further integration of "real-world assets" including tokenized Treasuries and securities. He's also excited about Lens and decentralized social media, which he expects to build slowly but surely as more people turn away from centralized services like Twitter and start to control their own online data. "There's a lot of social capital that we create in our internet and in real life and Lens helps to preserve that capital in ownership directly for the users," he said. "It's still in the very early stages, but we already have that infrastructure of decentralized social media that is quite significant for our space."
Finally, Kulechov expects to see more talk of blockchain technology offering verifiability and tracking for artificial intelligence development. "I think we'll start to see how to govern AI from the perspective of using blockchain as well. I think that's another interesting area that gets less attention from our industry, and could be an interesting tool," he said.
Whales accumulated AAVE, signaling increased interest. Aave’s stablecoin GHO contributed to substantial annualized revenue. Aave [AAVE] witnessed heightened interest from whales, with a notable whale wallet “0x04e9” accumulating a substantial amount of AAVE in the past two days.
The wallet withdrew 74,250 AAVE ($7.6M) from Binance [BNB], signaling significant whale movement within the Aave ecosystem.
Whales move in The accumulation of AAVE by a prominent whale wallet indicates a growing attraction of large investors toward the token.
Such whale activity often serves as a precursor to potential market movements, making it a crucial aspect to monitor for Aave enthusiasts and investors.
The influx of whales into the Aave ecosystem can have significant implications for the token’s value and overall market dynamics.
Whale movements are closely watched for insights into market sentiment and potential future trends, raising questions about the trajectory of AAVE’s price.
Fresh whale wallet"0x04e9" accumulated $AAVE and $MKR again!
The wallet has withdrawn 74,250 $AAVE($7.6M) and 4,802 $MKR($6.8M) from #Binance in the past 2 days.https://t.co/TbOkgxxLXH pic.twitter.com/CMjeNCR1uC
— Lookonchain (@lookonchain) December 26, 2023
Stablecoins contribute as well Aave’s stablecoin, GHO also proved to be a lucrative asset for the platform. The stablecoin generated an annualized revenue of 2.1 million, and its peg was steadily improving.
If GHO continues to scale, the revenue for the Aave DAO is poised to experience substantial growth.
The Aave protocol is not only benefiting from GHO, but also thriving with other stablecoins. USD Coin [USDC], for instance, is offering a remarkable 26% annual percentage yield (APY) through Aave on the Avalanche [AVAX] network.
This attractive APY presents an opportunity for users to earn substantial returns on their stablecoin holdings, contributing to the overall growth and adoption of the Aave protocol.
Realistic or not, here’s AAVE’s market cap in BTC’s terms
Price movements tell a different story In terms of price, AAVE was trading at $99.32, experiencing a marginal decline of -1.04% in the last 24 hours.
Simultaneously, the network growth of AAVE witnessed a decrease, suggesting a potential waning interest from new addresses in the AAVE token. Only time will tell whether the price movements will mirror the protocol’s growth, going forward.
Decentralized non-custodial lending and borrowing protocol Aave is voting to onboard PayPal's PYUSD stablecoin issued by Paxos Trust Company.
In an ongoing governance vote, 99.98% of the participating AAVE token holders favor integrating PYUSD into AAVE's Ethereum-based pool. The voting on the proposal, termed temperature check, floated by Trident Digital on Dec. 18, will end later Thursday. The vote follows decentralized exchange Curve's December decision to host PYUSD.
PYUSD, the dollar-pegged stablecoin, came into existence in August and now has a market capitalization of $289 million, or 0.3% of industry leader tether’s $94 billion.
Aave is a decentralized finance protocol enabling users to lend and borrow funds without an intermediary. Per DappRadar, AAVE is the world's third-largest DeFi solution, with nearly $5 billion worth of crypto assets locked into the protocol.
Majority of the participating AAVE token holders favor PYUSD integration. (Aave)Trident’s proposal says that AAVE's integration of PYUSD will help build synergies with PayPal's stablecoin and strengthen the relationship between PYUSD and AAVE's decentralized multi-collateral stablecoin GHO.
Trident, which is incentivizing the PYUSD/USDC liquidity pool on Curve, will contribute $5 million to $10 million in liquidity for PYUSD on AAVE from day one, the firm said in the governance proposal chat.
"The idea is to keep yields quite high on Curve. This will create organic borrowing demand for PYUSD on AAVE. So while we don’t intend to provide direct incentives on AAVE we believe our overall incentive strategy will allow for borrowing demand on day 1," Trident said.
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On-chain data suggests that whales are accumulating large amounts of Maker (MKR) and Aave (AAVE), two leading decentralized finance (DeFi) tokens. This accumulation trend coincides with a broader cooling-off period in the crypto scene days after the United States Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETFs.
Whales Accumulate MKR And AAVE According to ScopeScan data, Anchorage Digital, a digital asset custody firm, purchased a significant amount of MKR on January 15. The firm acquired 12,103 MKR tokens, valued at approximately $24.7 million, from Coinbase, a leading crypto exchange in the United States.
Two whales, “0xbb5f” and “0x4a7,” also accumulated large quantities of MKR and AAVE. Specifically, “0xbb5f” bought 50,000 AAVE and 2,452 MKR worth around $5.03 million and $4.95 million from Binance, a leading cryptocurrency exchange. Meanwhile, 0x4a7 purchased 39,000 AAVE and 2,350 MKR, valued at approximately $3.95 million and $4.75 million, also from Binance.
Whales Accumulating Maker and Aave | Source: Scopescan These whale purchases signal a strong belief in the long-term potential of MKR and AAVE. Maker and Aave are two of the world’s leading decentralized lending and borrowing protocols across DeFi. MKR serves as the governance token for MakerDAO, which also manages the DAI decentralized stablecoin. On the other hand, AAVE is the governance token of Aave, a top decentralized lending platform.
According to the latest DeFiLlama data, Maker and Aave have total value locked (TVL) of over $8.4 billion and $7.3 billion, respectively.
Top DeFi protocols | Source: DeFiLlama Notably, whales are accumulating MKR and AAVE when the DeFi scene is recovering following the sharp contraction from 2022. The industry manages over $56 billion, with Ethereum hosting more liquid DeFi protocols, including Lido DAO when writing in mid-January 2024.
Will Maker and Aave Rally To New 2024 Highs On Recovering DeFi? Last year, MKR and AAVE were among the top-performing DeFi tokens, with MKR rising by over 200% and AAVE appreciating by more than 150%. Protocol-specific fundamentals, including the launch of Spark in Maker, partly drove this strong performance.
Aave launched the GHO stablecoin and the Lens protocol on the Ethereum sidechain, Polygon. Moreover, expectations of the spot Bitcoin ETF forced aggressive traders to consider top DeFi protocols, lifting altcoins.
Maker price trending upward on the daily chart | Source: MKRUSDT on Binance, TradingView As whales accumulate, there is more headroom for these tokens to grow. Presently, AAVE and MKR are lower, based on their respective performance in the daily chart. However, overly, the uptrend remains. To illustrate, MKR is within a bullish breakout formation with a critical support level of around $1,560. Any surge past $2,300 might ignite demand, lifting the token to new 2024 highs.
