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Newsletter #8

Cryptocurrency market trend is still unclear. Brave DeFi gamblers got back to buying discounted food tokens, while the more wary are waiting for Bitcoin to decide their trading strategy.

Top DeFi Tokens Dump 50% in a Week

The DeFi food farming frenzy may have headed into the compost heap as the sector’s top DeFi tokens take heavy losses.

As everyone continues to watch Bitcoin’s struggle around the 10k levels, last month’s fastest climbers have fallen the hardest. During the DeFi summer, the top token gainers during the rally have all been fueled by decentralized finance products. And now in a turn of events, they are leading the losses.

Bitcoin’s failure to burst past the $12k mark, and Ethereum’s cliff dive when nearing $500 have resulted in the whole cryptocurrency market seeing red. Over the past seven days, total market capitalization for all cryptocurrencies has corrected by 20% after a 26 month high.

Top 6 DeFi Tokens Dumped the Hardest

Messari Crypto tweeted out that it has been a rough week for the decentralized finance sector, with six major tokens dumping over 50% during the period.

We spot Curve Finance token CRV being the biggest loser, with a drop of over 65% during the past seven days. You might remember Curve DAO token being sold at $50 just after it was launched mid-August. In a chart that resembles an ICO token after an exit scammed, CRV is now trading just under $2, a plummet of over 95% since launch.

The other five tokens that have lost over 50% are Meta’s MTA, bZx Network’s BZRX, Ren’s REN token, Airswap’s AST, and Wrapped Nexus WNXM. The carnage did not end there, a whole range of DeFi protocol tokens, including BAL, AKRO, UMA, KAVA, BNT, SNX, YFI, and KNC saw their value drop between 30% to 40% over the same period.

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What about SUSHI and the food clones?

The crazy weekend of takeover events for SushiSwap has not restored any investor confidence. The token is now down by over 80% on the week as the SUSHI selloff ramps up. Following its popular launch, SUSHI’s price went up to top $11, but that high was very short lived. It is now traded at around $2.20 today, with the supposed liquidity migration just hours away - perhaps holders are wary that the team can actually prepare the fish?

Other less known protocols did not have a fun week either:
  • Kimchi Finance is definitely not faring any better, with KIMCHI token down by over 90%.
  • DFI Money, the fork of Yearn, also reported heavy losses with YFII down by over 60% over the week.
  • Harvest Finance, another popular automated yield farming tool, native token FARM is also down by over 60%.
If you are holding these DeFi tokens discussed today, I wouldn’t despair just yet. Many of these projects saw four-figure percentage surges during this year, so you could argue a correction before new highs is a healthy sign. Time to hold out for the bounce!

What is Bella Protocol? BEL is making DeFi easy

Bella Protocol is making DeFi products easy to use and accessible to everyone via their aggregated use interface. Their DeFi suite is a one-click solution to start crypto banking with ease. Essentially, it vastly simplifies the user experience of various DeFi protocols with the goal of letting anyone deploy their assets and start earning yield.

What is Bella Protocol?

High gas costs, slow speeds, and bad UI designs are blocking many users from embracing newer DeFi products. Much like Yearn Finance and DFI Money, the Bella DeFi suite lets users simply deposit their assets and then sit back. The protocol will automatically identify the highest yield strategies and get to work. As a result, no more manually having to bounce funds around different protocols and lose out to high tx costs on Ethereum, Bella Protocol has zero gas fees and follows a one-click design.

What products are in the Bella DeFi Suite?

Bella Protocol has several planned products on their list:
  • Liquidity Mining: Users will be able to stake various supported liquidity provider tokens from protocols such as Curve, and earn BEL in rewards.
  • Flex Savings: this strategy will perform cross-platform arbitrage yield farming for stablecoins and other cryptocurrencies.
  • One Click Portal: is a smart portal where CeFi meets DeFi. It allows users to deploy their assets on popular DeFi products using a custodian service in just one click, with subsidized gas fees.
  • Lending: a borrowing and lending protocol much like Aave or MakerDAO.
  • Robo-Advisor: based on a user risk profile, will generate a customized portfolio of indexes, yield-earning stablecoins, and other crypto assets.

What is the BEL token?

The BEL token provides you with voting and governance power within the Bella ecosystem. Importantly, holders will be able to enjoy profit sharing, fee discounts, and staking rewards. Currently, token distribution is by Binance’s LaunchPool concept; where you can stake BNB, BUSD, or ARPA to earn a share of weekly rewards in BEL tokens.

Looking to the future… Bella Protocol has a team of experienced blockchain veterans behind them from ARPA Chain. Furthermore, they have high profile partners such as Binance Labs, AlphaBit, and Ledger Capital. The idea of combining both DeFi and CeFi into a hybrid finance product ensures inexperienced DeFi users can easily be onboarded. Along with an endless possibility of integrations into centralized exchanges, sounds like a recipe for growth! Keep your eyes on BEL token.

How to turn $200 into $250k trading buggy DeFi tokens

One DeFi token trader seems to have hit his lucky day where all the stars aligned. The anonymous trader took to twitter to reveal how he made $250k in profit by making a minor investment into a fork of Yearn Finance called Soft Yearn (SYFI) token.

What in god's name is SYFI token?

Soft Yearn was launched as an adaptive cryptocurrency asset, meaning it automatically adjusts its supply to keep the value softly pegged. A concept made popular by the Ampleforth token’s rebasing mechanism. A bug in the SYFI-rebasing mechanism meant that the Uniswap price of the token never adjusted to account for the rebase.

Hitting the jackpot… Which meant that once the first rebase happened, the trader was able to sell his tokens at the previous price. This wiped out all of the pool’s liquidity in one trade, netting the trader 740 ETH from an initial investment of just 0.5 ETH.
  • The anonymous trader known as Amplify on Twitter has stated he did not intentionally exploit the code. His trading strategy revolves around buying into fresh Uniswap listings with Ethereum, and this was just a lucky pick.
The end for Soft Yearn… Much like other recent DeFi clones, SYFI token’s initial price started by going up rapidly. It then faced a sudden drop and once the users became aware of the bug, it collapsed completely. The team is working on v2 to fix the problem, but it looks like their reputation is already in tatters.

What is Hakka Finance and BlackHoleSwap?

Hakka Finance is a decentralized autonomous organization, or DAO, that launched early August. The team is building a DeFi ecosystem around several unique products, such as BlackHoleSwap, following community governance. The project features the HAKKA governance token, which gives holders voting power to decide the path of future products. Hakka finance aims to reach a final form of being a prosperous DeFi ecosystem, where holders receive a corresponding share of the revenue.

The project seems to be flying a little under the radar, perhaps the crypto community will only follow copycat DeFi protocols? Their loss! Unlike the abundance of yield farming copycats launching daily (with no actual product!), Hakka is not a clone project. The dev team already has a history of releasing innovative dApps: Fulcrum Emergency Injection or Tokenizing CDP. And their flagship product BlackHoleSwap is live and operational.

What is BlackHoleSwap?

BlackHoleSwap is a decentralized AMM (Automatic Market Maker) for swapping stablecoins, you could compare it to Mooniswap or Curve. However, BlackHoleSwap has a unique design that enables near-infinite liquidity. Because it integrates several lending and borrowing DeFi protocols such as MakerDAO or Compound.
This way the protocol can leverage unused liquidity (excess supply) to borrow on the inadequate side. As a result, BlackHoleSwap can execute trades with low slippage far exceeding its existing liquidity. Hence the birth of a new meme: deepest liquidity in the universe. On a more serious note, the design could make it ideal for whales looking to hedge into different stablecoins given the ability to handle large orders. Furthermore, the protocol's smart contracts have been audited by Peckshield.

What is HAKKA governance token?

Token holders will eventually form HakkaDAO, which is set to happen in Phase 4 of the governance roadmap. What is interesting about HakkaDAO is it will not just be governing BlackHoleSwap, the team is building a whole range of DeFi products. This is very exciting, as it shows the team is forward-thinking and building with purpose.
what is HakkaDAO DeFi products?
Liquidity mining will distribute most of the tokens, which will last 214 weeks. Though the number of rewards will go down each week, making it worthwhile to get in early. One thing to note is that early investors are up by over 1000x on initial sale price. As a result, I recommend this project for farming but it may not be the best token to start trading. Given that early investors could dump on you at any moment. Importantly, the team is very transparent with all past sales, prices, vesting - which you can find here.

How to earn HAKKA tokens?

Liquidity mining on BlackHoleSwap is relatively new, so you should exercise caution. You can earn HAKKA tokens as rewards for providing liquidity to the BlackHoleSwap DAI/USDC pair and/or this HAKKA Balancer pool. Meaning there are two rewards pools, with HAKKA's distribution as per below.
what is hakka finance and blackholeswap?
Remember, you must stake your liquidity tokens in the Rewards Dashboard or you will not earn anything. The easiest access path is via the Balancer pool because you can enter with HAKKA, DAI, USDC, or BHSc tokens. Plus it distributes x6 the amount of HAKKA tokens.

Happy yield farming!

Also take note

  • Metal Pay: MTL is now available on Uniswap.
  • COTI: launches a liquidity mining program with an estimated 100% APR.
  • Binance Summit: don’t miss the World of DeFi event starting tomorrow, for new announcements.
  • Local Adoption: Binance is opening a new local exchange primarily for Turkey.
  • FlashSwap: Ankr has announced a new DeFi product that will support decentralized margin trading.

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