DeFi Sparks New Investment Despite Market Turmoil: Finance Redefined

DeFi Sparks New Investment Despite Market Turmoil: Finance Redefined

Welcome to Finance Redefined, your weekly dose of essential decentralized finance (DeFi) news – a newsletter designed to bring you significant developments over the past week.

The prolonged crypto winter, aided by the collapse of FTX, has prevented investors from backing a new protocol that merges DeFi and the forex market. A new DeFi protocol based on the Cosmos blockchain has caught the attention of investors who have invested $10 million behind the project.

Ardana, a Cardano-based stablecoin ecosystem, abruptly halted development after several launch delays. However, the project remains open-source for others to add until they restart the development process.

The Aave community has now proposed a governance change after a short $60 million failed attack. The short attack was later attributed to the exploiter of Mango Markets, as one of the wallets involved in the attack belonged to the same exploiter.

The crypto market remained choppy throughout the week, with the majority of the top 100 DeFi tokens trading red, except for a few.

DeFi protocol raises $10 million from Bitfinex and Ava Labs despite turbulent market

Onomy, an ecosystem based on the Cosmos blockchain, has just obtained millions of investors for the development of its new protocol. The project merges DeFi and the forex market to put the latter on-chain.

According to the developers, the latest funding round raised $10 million from major industry players such as Bitfinex, Ava Labs, Maker Foundation, and CMS Holdings, among others.

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Cardano’s main stablecoin project comes to a halt after excruciating launch delays

On Nov. 24, Ardana, a leading Cardano-powered DeFi and stablecoin ecosystem, abruptly halted development, citing “uncertainty in project funding and timing.” The project will remain open-source to builders while remaining cash balances and funds will be held by Ardana Labs “until another capable development team from the community comes along to continue our work.”

This decision came as a shock to many due to the sudden nature of the announcement. However, it seems that problems had already been present for some time. Since July 4, Ardana has held an Initial Pool of Stakes Offering, or ISPO, to fund its operations. Unlike traditional fundraising mechanisms, developers do not receive user-delegated Cardano (ADA) but rather staking rewards.

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Aave Proposes Governance Changes After Failed $60M Short Attack

On November 23, a day after Mango Markets exploiter Avraham Eisenberg attempted to use a series of sophisticated short-selling to exploit the Aave decentralized finance protocol, contributors to the project presented a series of proposals to deal with the consequences. As recounted by protocol engineering developer Llama and financial modeling platform Gauntlet, both deployed on Aave.

Llama wrote that the user was liquidated but at a cost of $1.6 million in bad debt, likely due to a slip-up. “This excess debt is isolated only to the CRV market,” the company wrote. “While this is a small amount compared to Aave’s total debt, and well within the limits of Aave’s security module, it is best to recapitalize the system to make the entire market CRV.”

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Crypto wake-up call: Researcher explains exodus of ETH from exchanges

Nansen research analyst Sandra Leow posted a Twitter thread unpacking the current state of DeFi with a particular focus on the movement of ether (ETH) and exchange stablecoins.

As it stands, the Ethereum 2.0 deposit contract contains over 15 million ETH, while some 4 million wrapped ether (wETH) is held in the wETH deposit contract. Infrastructure development and investment firm Web3 Jump Trading holds over 2 million ETH tokens and is the third largest ETH holder in the ecosystem.

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DeFi Market Overview

Analytical data reveals that the total value locked in DeFi has dipped below $40 billion. Data from Cointelegraph Markets Pro and TradingView shows that the top 100 DeFi tokens by market cap had a volatile bearish week due to the FTX saga, with the majority of tokens bleeding throughout the week.

Curve DAO Token (CRV) was the biggest gainer among the top 100 DeFi tokens, registering an increase of 23.8% over the past week, followed by Chainlink (LINK) with an increase of 8%. The rest of the top 100 tokens were trading in red on the weekly charts.

Thanks for reading our roundup of this week’s most impactful DeFi developments. Join us next Friday for more stories, ideas and education in this dynamically evolving space.