TLDR Crypto Daily Update 2022-04-20

Solana 0-interest loans ☀️, ETH's centralization problem Ξ, Andre Cronje returns 👨‍💻

Innovation & Launches

Solana DeFi Platform Hedge Raises $3.7 Million to Offer Interest-Free Loans (2 minute read)

Solana protocol Hedge recently raised $3.7 million in a seed funding round. Hedge offers instant, interest-free loans in its stablecoin, USH. Borrowers only need to deposit 10% of the total value desired to receive a loan. The funding will go towards hiring new staff and finalizing its product for a Solana mainnet launch. Solana has a number of decentralized exchanges, but its total value locked is only about 5.8% of Ethereum's ecosystem.

DeFi Developer Andre Cronje Teases New Regulation-Focused Crypto Projects (3 minute read)

Andre Cronje has returned to crypto to work on projects focused on crypto compliance and regulation. Cronje is known for building protocols that allow participants to take greater risks for higher yields. His announcement that he was leaving the industry last month sent the tokens of several DeFi protocols tumbling. Cronje recently published a blog post criticizing the DeFi market, saying that the industry was repeating the mistakes of previous monetary policymakers.
Guides & Resources

faucetli (GitHub Repo)

faucetli is a command-line tool for quickly getting tokens on testnets. It removes the need for developers to visit faucets. faucetli currently only supports Polygon Mumbai and Rinkeby networks.

Here is my risk adjusted stablecoin yield strategy (3 minute read)

Stablecoin farming is seen as a comfortable and passive way to earn income, but there is always risk when using DeFi protocols. This Twitter thread suggests a risk-adjusted stablecoin yield strategy. Investors should spread out risk amongst four or five protocols. One protocol can be riskier, but it should hold no more than 10% of your portfolio. USDC is the safest and lowest risk stablecoin and diversifying into other stablecoins is just introducing more risk. Leaving coins in a protocol is better than regularly moving them around.

Curve Wars explained (4 minute read)

This Twitter thread explains what Curve Finance and Convex is, how vote-locking and veCRV works, and how vote-locking aligns incentives. Curve is a decentralized exchange for stablecoins that features a governance token that provides rewards and voting power. Vote locking makes holders commit to their position for the duration of the lock, aligning the incentives of token holders with Curve's incentives. Over 40% of vote-locked CRV is held by Convex, a yield farming platform, giving its liquidity pools and token holders benefits such as increased earnings.

The new BNB burn formula is interesting (2 minute read)

BNB is burned each quarter according to a formula. The formula takes into account the price of the token and the burning stops when there are 100 million tokens left. About 1.8 million BNB was burned in the last quarter. This Twitter thread explains BNB's burn mechanism and looks into some of the implications of the system.

Ethereum's Centralization Dilemma Through Lido Staking (7 minute read)

Ethereum's merge to proof-of-stake is leading to centralization. Becoming a validator is expensive, so many people use pools like Lido. Lido has over a quarter of all staked ETH and its share is growing. Its monopoly over staked ETH could result in Lido having control over Ethereum's governance. A centralized system could mean that addresses can be blacklisted and funds seized if the centralized authority decides to do so. Decentralization is important in a free and open monetary system.

Coinbase Chief Legal Officer: SEC Exchange Definition ‘Just Doesn’t Work’ (2 minute read)

Coinbase's chief legal officer has criticized the SEC's proposal to update its definition of an exchange. The SEC’s proposal seeks to expand the definition of an exchange to make it broad enough to apply to decentralized finance platforms. The new rules could mean that each participant in a decentralized autonomous organization would need to submit SEC filings to register as an exchange.

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