August 2020 will be remembered as a very eventful month in the decentralized finance ecosystem, in Ethereum and, really, in all of crypto.
Firstly, we saw the continued market rise that kicked off in late July alongside a few corrections, both of which resulted in increased usage of decentralized finance protocols.
Secondly, we saw the introduction of COMP (Compound) and BAL (Balancer) tokens distribution through liquidity mining, continued with more legitimate projects initiating distribution of their governance tokens in the same way, such as Yearn and Curve.
While some of this happened in July, it eventually kicked off a plethora of projects providing yield-farming options that culminated in August. This drove users to jump from one project to the other, as each one would start off with higher theoretical interest rate. There was YAM, there was SUSHI, there was KIMCHI, YFII, FARM, BURGER, MILK, PASTA, HOTDOG, Spaghetti— you name it, it probably launched in August.
Finally, all of this activity combined caused gas prices and transaction fees to spike through the roof. With people staking, un-staking, re-staking, supplying one collateral and borrowing other to supply to pools, then staking the LP tokens, buying tokens required for staking, dumping earned tokens with other people buying them instead of farming to join the party etc etc.
There were days where gas stuck at 300+ Gwei for fast all day long and there were days when it would spike to 500 Gwei required to get a transaction through in any reasonably short time. All of this resulted in probably unexpected amounts paid in transaction fees in a very short period, as illustrated with the screenshot below.
With the yield farming season in full swing, we still remained focused on lending and borrowing and our long-term plans, so let’s talk about the news we had to share in August.
DeFi Saver news and updates
Aave dashboard introduced
Having previously worked with Aave on many flash-loan powered features for other protocols, as well as introduction of DAI lending via Aave in our Smart Savings dashboard, the logical next step was definitely to introduce a full-blown management dashboard.
Although Aave only launched on the Ethereum mainnet in January this year, they’ve already proven to be one of the most innovative teams in decentralized finance.
Our Aave dashboard introduced Boost and Repay for the first time for Aave users and we are currently working on Automation support, too — expect news about this in the coming weeks!
For more details about this launch, please see our introductory post here.
DeFi Saver en español 🇪🇸
Thanks to the help from members of the Spanish speaking DeFi community, we were very glad to introduce a Spanish translation of the whole DeFi Saver app.
This now makes DeFi Saver available in 3 languages — English, Spanish and Chinese. But we want to expand this list further, so if you think you can help out with a translation in other languages. please get in touch.
We always aim to make the DeFi Saver interface as intuitive as possible, but we fully understand that language remains a barrier in some cases and we want to make DeFi Saver accessible to everyone.
Response to high gas prices
As soon as it became clear that high gas prices have become the new norm and are likely to stay >100 Gwei most of the time, we introduced some conditions that would ensure profitability for relatively smaller positions, as well as overall sustainability of the Automation system.
The most important condition we introduced is probably the one that:
- Automated Boosting will only be executed if the transaction cost is less than 5% of the Boost amount.
That is a condition that applies to all automated positions in order to make any obtaining of additional collateral for leverage profitable for the position owner. And the way this works is that Automation keeps monitoring your position for whether this additional condition has been met (on top of your configured Boost ratio) and only executes a Boost when this is true.
We are absolutely open to feedback on all of this, so if you have any suggestions, please join us in our discord and share — we would love to hear them.
Note: We don’t plan (and don’t want) to change these introduced conditions often, but the best place to learn about any changes as they happen is by following the #announcements channel of the DeFi Saver discord.
As of August 31st, there were a total of 441 MakerDAO and 28 Compound positions with Automation enabled, with the system managing over 141,400 ETH and 69 WBTC in collateral.
Overall, this was an incredibly active month at DeFi Saver with over $31m in volume made in more than 2900 unique transactions.
This is a lot more than our previous monthly record of $20m that happened in March, driven by the Black Thursday crash. And it’s also a lot more than the $16m volume made in all of 2019. Simply put, this is absolutely amazing and we are blown away by the amount of activity we are seeing on DeFi Saver.
Additionally, besides the incredible volume, we also once again broke all of our previous flash loan records with a $13.9m flash loan made by a user unwinding their DAI/DAI position in Compound.
Although we’ve been seeing larger and larger flash loans utilized by DeFi Saver users month by month, this one will be hard to beat as it used up pretty much all of available DAI liquidity at Aave. An incredible feat, really.
As always, we also want to take a minute to share some of you that showed support for DeFi Saver during the month of August.
DeFi Dad, one of the best educators in the DeFi ecosystem, continues to show appreciation for the tools that we keep introducing.
Camila Ruso, the author of The Infinite Machine, praised the interoperability and composability of DeFi apps and protocols by sharing news about our recently released Aave dashboard.
Doo from Maker’s Korea team also went ahead to recommend our Automation and liquidation protection services to an owner of one very risky MakerDAO CDP.
Thank you for always helping us share any news we have and for always recommending DeFi Saver to anyone who brings up liquidation
Even though we’re still early in September — here’s a small teaser: there was more than $30m of volume made in the first seven days of the month already.🤯
Stay tuned and talk soon!