Welcome to our latest newsletter, covering recent updates, stats and ecosystem happenings!
After the Luna & UST fiasco in May, the crypto markets experienced a continued, macro-influenced downturn even later into June. We also saw the consumer price index hit 1% in May alone, resulting in a 8.6% CPI YoY rise. And with inflation heating up, the Fed reacted with raising benchmark interest rates by 0.75%. This was the biggest increase since 1994, and the Fed chairman's expectations are that we are probably going to see a further 0.5% or 0.75% hike in July, too.
Overall, June has been an odd month, to say the least.
In crypto lands, Bitcoin had one of the worst months on record, being 38% down, and Ether ended the same period at roughly half the value from the start of the month (-47%), crashing from $1950 all the way down to ~$1000 by the end of June. We even witnessed 3-digit ETH for a bit.
This large shift in market sentiment eventually led to some major CeFi companies facing solvency crises and tainting the ecosystem image, though we also saw headlines such as "CeFi broke, DeFi didn't".
The probably largest case of CeFi issues culminated on June 13, when Celsius, a centralized finance lending company, paused withdrawals after weeks of rumours about insolvency.
In comparison to cases such as this one, we saw DeFi protocols working exactly as they were designed to, and not just in terms of transparency and self-custody - all DeFi protocol mechanisms for keeping protocols overcollateralized during highly stressed market conditions worked as intended.
At the crossover between CeFi and DeFi, we also saw CeFi projects clearing DeFi debts as their priority. For example, Celsius topped-up their Maker vault 6 times during the crash and then paid back parts of their debt 9 times to avoid liquidation, before finally clearing the debt in full and closing the position.
Adding to the matter, on June 27, a publicly-traded crypto platform Voyager Digital issued a notice of default to the Three Arrows Capital, claiming that the hedge fund failed to make payments on a loan worth about $660 million. Two days later, the BVI court ordered the liquidation of 3AC.
If anything that events from June taught us, it's that self-custody is absolutely worth the time and effort when it comes to digital assets.
Some other June news worth mentioning include:
- GFX Labs introduces a new lending protocol called Interest Protocol.
- Hop protocol enables claiming of $HOP tokens.
- Circle announces new euro-backed stablecoin - EUROC.
- NY department of financial services stated the stablecoins must be fully backed.
- Harmony Protocol's Horizon bridge exploited, $100 milion drained.
- Lido community votes 'No' on self-limitation proposal.
- Coinbase lays off 18% of staff as an act of preparation for 'crypto winter'.
- Compound proposes a next-generation lending protocol - Compound III.
- Maker temporarily disables Aave D3M.
- Aave proposal to increase stETH LTV to 90% failed.
- Maker considering to add tokenized short-term bonds as PSM collateral.
DeFi Saver news and updates
Following our initial L2 launch in May, we have been heads down working on improvements of our Aave v3 and the new Bridge dashboards. And June was also a month for setting up the stage for DFS Automation on L2s. with the plan being to roll out out first automation features for Aave v3 in July.
DFS is the EVMavericks protocol runoff winner!
While this may not seem like a big deal to some, we are very proud to announce that DeFi Saver was the last one standing in the EVMavericks battle royale! Their protocol runoff poll featured 25 DeFi protocols at the start and ended with DFS & MakerDAO as finalists in round 5.
We have had continuous support from the r/ethfinance community since our earliest days (as CDP Saver back then!), we see this as confirmation that we're as tightly connected with the broader community as we were when we started and we just really love that. Thank you once again to everyone who voted for us!
LDO rewards distribution
This was a very long wait and both we and the Lido team once again apologise that it's taken so long for the LDO to be distributed. The timing for the rewards to be sent out coincided with a number of events that required higher priority from the team, but, if any such promotion happens again, both teams will be aiming to deliver a much better experience for all users.
You can find the details about LDO winners and rewards distributed in our post here.
DNS attack on the defisaver.com domain on June 23
On the afternoon of June 23 we received alerts of suspicious activity from our domain name registrar. The team cancelled all attempted changes and monitored the situation closely, including all traffic to ensure no malicious redirections were being made.
We where highly suspicious of the root cause lying with Namecheap and initiated a migration to a different registrar. Further analysis was done on all active accounts around this time and to the best of our knowledge no users were affected in any way and none come forward about facing missing funds or any similar issues.
Besides DFS, several other projects were affected, too, including Convex, Ribbon and Allbridge. We quickly established communication with them to discuss and help better trace down the cause of the issues, while also inviting other projects to exercise caution.
Ultimately, it was fairly quickly confirmed that Namecheap had a compromised customer support agent.
Besides moving to a different registrar, we should highlight that we also established constant monitoring of the hash of the web app and all its files which triggers warnings on all changes, as suggested by Alex from deBridge.
Since going live on Arbitrum and Optimism on May 30th, there has been a total of 1715 DFS Repay & Boost transactions on L2s in June (820 on Optimism, and 895 on Arbitrum), showing just how more accessible these networks are, either for smaller positions or even just for experimenting.
On L1, users made $182m of actual trade volume during June, with over 1619 unique leverage management transactions and custom recipes done at DeFi Saver.
At the end of June, DFS automation was enabled for 156 MakerDAO CDPs, 48 Aave positions, and 34 Compound positions.
The total amount of automated collateral at the end of June was 73,628 ETH, 825 WBTC, 61,000 LINK, and 1,120 MANA, among other collateralized assets. DeFi Saver Automation managed around $100M of collateralized assets in different user-created positions at the end of the month.
Though we didn't have that many news to share in June, you guys out there still had stuff to say about DFS.
Maybe most notably, Token Bryce from Liquity published a 'Trove management made easy' post about DeFi Saver as one of the leading Liquity frontends (and one with most features available):
Our long time acquaintance, Steve, also showed appreciation for DFS tools:
And we just have to highlight this post from Hodlercon, where poor Superphiz got mega liquidated:
But then the man himself went ahead and shared some words of appreciation for our work:
Finally, our friends at Today in DeFi covered the Loan Shifter and if that's something you haven't used so far, definitely give the thread a quick read through:
Thank you all for reading and see you again next month!