Welcome to the Ethereum price preview where we look at recent and upcoming trends to provide an easy-to-digest overview of the chain from an investor’s standpoint. With DeFi approaching its next billion-dollar milestone and new initiatives soon to launch on Ethereum, there’s a lot to look out for in the weeks ahead.
DeFi to Cross $2 Billion in July
DeFi has seen massive growth in recent months. The total value locked (TVL) in DeFi has risen from $230 million in January 2019 to over $1.8 billion today. DeFi crossed the $1 billion mark just 5 months ago, and now looks set to reach $2 billion in TVL in a matter of days.
Compound remains the most dominant protocol in the DeFi ecosystem with 34% dominance and $645 million in TVL compared to Maker’s $567 million.
Much of the growth has been due to the rise in yield farming, the practice of earning rewards on decentralized applications (dapps) within DeFi. The Curve Finance exchange saw its volume jump by $213 million following the COMP token distribution, with yield farmers flocking to the exchange to swap between stablecoins and – more recently – BTCe.
Ethereum co-founder Vitalik Buterin warned against the dangers of unsustainably high yields.
“The reality is that there’s no way that DeFi will have interest rates more than a percentage point above the best of traditional finance in the long run.”Part of a Tweet thread by Vitalik Buterin
Several DeFi altcoins have seen parabolic growth over the past few months, including tokens for Chainlink, Kyber Network, Synthetix and Compound.
Katalyst and KyberDAO Go Live This Week
Kyber Network’s much awaited Katalyst update is upon us. Kyber Network allows on-chain token swaps that improve the interoperability of the DeFi ecosystem. Users can easily swap ERC20 tokens without needing a centralized exchange.
This has a use case in allowing merchants to accept multiple cryptocurrencies and receive instant payment in the ERC20 token of their choice. It also allows people to use dapps without purchasing the individual native tokens for each dapp, solving a major pain point in DeFi.
The new update introduces the launch of KyberDAO, where KNC token holders can stake tokens and vote on the direction of the project.
With the ability to earn rewards for staking the KNC token, KNC has risen in value by 60% in the last 14 days. Participants in KyberDAO can vote on decisions like exchange fee rewards and KNC token burns.
Augur v2 Announced
On June 29, decentralized predictions platform Augur announced the launch of Augur V2 which is expected to launch on Ethereum mainnet on July 28. Augur users can bet on the outcome of future events as well as earning fees for creating markets on the platform.
The platform processed millions of dollars in bets on the outcome of the 2018 US midterm elections and with the 2020 elections on the horizon, it’s likely that Augur V2 will see another surge in activity. Users can place bets in the DAI stablecoin, pegged to the US dollar and Augur is launching a new mobile and desktop app to facilitate a user-friendly experience.
In industry events, the HackFS hackathon organized by ETHGlobal will take place between July 6 and August 6. The event is centered around building Dapps, developing decentralized storage solutions and building web3. The event is partnered with Protocol Labs, the organization behind Filecoin and IPFS.
A recent ETHGlobal event, HackMoney, led to the creation of 120 new projects and HackFS is designed to inspire further progress in the space. Developers can apply to hack at the online event through the website, joining potential teammates and mentors in web3 development.
Pittsburgh Ethereum is also hosting an online event called Trustless Digital Economies with Allen Hena on July 11. Hena is a web3 software engineer and cryptocurrency consultant, and the event will feature a presentation and discussion on the development of economies within web3.
Finally, Festival Hackathon are hosting an online event on July 12 – July 13. The event will feature prominent web3 developers and cryptographers who will share their knowledge and skills, working together to develop new solutions in the DeFi and web3 ecosystem.