Since UNI rewards ended yesterday, Uniswap's TVL has dropped by 40% to $1.9 billion. The bleeding shows no signs of abating yet.
Let's take a quick look at a few large liquidity providers (at random) and what they are doing with their freed-up capital. 👇
0xe0e withdrew $1.7m worth of liquidity from Uniswap's ETH-DAI pair.
They deposited all of that capital immediately into cAssets, cDAI and cETH.
0x975 withdrew $2.8m worth of liq from ETH-DAI.
They deposited all that capital back into Binance without converting the ETH into DAI or vice-versa.
They made this addy with the sole purpose of farming UNI, meaning they're probs looking to re-allocate to DeFi or BTC (UOA).
0x7bb withdrew $5.5m in liq from DAI-ETH.
They converted the DAI into USDC, kept the ETH, and distributed the USDC amongst into a number of wallets. Most of the USDC was sent to FTX, though some was deposited into Yearn's cDAI/cUSDC vault.
0xf92 withdrew $3.3m from ETH-DAI.
The liquidity was quickly zapped into ETH-DAI LP tokens on SushiSwap, then staked for SUSHI.
0x161 withdrew $400,000 from ETH-DAI.
The ETH was deposited into Compound's cETH money market and the DAI was converted into DeFireX DAI (dDAI) in another address.
0x4f7 took the $1.7m they had in ETH-DAI and the $11.5m they had in ETH-WBTC and deposited that into SushiSwap.
Vampire attack 2.0 playing out in real time.
It appears that most are sitting on their stables and ETH for now.
We're probably going to see some interesting movements in DeFi yields and lending protocol TVLs.
Most importantly, we could see movements in coins down the risk curve over the next days.
Bitcoin is resilient around $13k, Ethereum hit $420, and DeFi TVL is at an ATH at $12 billion.
As DeFi continues to grow, decentralized exchanges will remain pivotal.
Here’s a thread on the outlook of the AMM market (Uniswap, Balancer, Sushiswap, LinkSwap, DODO).
Before we get into it, a brief explainer of automated market makers.
AMMs are a type of decentralized exchange where users pool liquidity, then trade with the coins in the pool. AMMs price liquidity with a formula (often x * y = k), algorithmically matching purchases and sales.
AMMs are starting to overtake centralized exchanges.
Uniswap alone did more volume than Coinbase in September. AMM liquidity pools can sometimes be deeper than centralized exchanges, sans trading fees (see image #1).
AMM also enable-chain arbitrage, a massive market.
There's been a bunch of buzz about @barn_bridge over recent days. The project's stablecoin seed pool has $180m just 24 hours after its launch. This makes it one of the biggest Ethereum yield farms ever.
But what exactly is BarnBridge?
An ELI5 Thread - 👇
DeFi is currently disjointed and risky compared to TradFi.
Yields differ wildly (see below), there are no fixed yield products, there is no yield curve, crypto is high vol, etc.
Those are issues that "degens" can disregard. But big money, maybe not so much.
There's no doubt that capital is entering DeFi at a rapid clip. DeFi Pulse is reporting that TVL has reached $11 billion — a 1,000% gain in just over six months.
But the aforementioned inefficiencies are preventing the next wave of capital.
Whoever is farming @barn_bridge / (starting in 24 hrs), I made a spreadsheet with the annualized yields of the stablecoin pool. USDC, DAI, and sUSD accepted.
Not an endorsement - seems to be one of the better, relatively safe stablecoin yield farms, though.
Here's a matrix for the yields on the / Uniswap LP pool, starting in eight days.
Yields are much higher as I assume TVL will be much lower due to potential impermanent loss risks.
Pool #1 (stablecoins) will be open for 25 weeks, with 32,000 BOND released a week.
Pool #2 (BOND/USDC LP) will be open for 100 weeks, with 20,000 BOND released a week.
In total, 2,800,000 tokens—28% of the total supply—will be distributed through these pools.