News
The MegaETH Pre-depost Chaos
MegaETH is one of the most anticipated chains in years.
Real time transactions, huge throughput, and a design that aims to outperform every existing L1.
USDm is the chain's native stablecoin. It's meant to create a steady revenue stream by backing it with T-bills. If MegaETH brings in over a billion dollars of USDm, it can easily generate millions in annual yield.
Before the USDM launch, the team wanted to create deep liquidity for USDM and attract some TVL to the chain.
The team started with a standard "pre-deposits bridge". Users can deposit USDC until the bridge hits $250M deposit cap. In return, they'll get USDM + rewards in December.
It had insane demand. Degens were seeing it as a 1000% APR farm, similar to farms on Plasma when it launched.
Then the problems started.
When pre deposits opened, many users couldn't deposit because of a technical issue. The bug was fixed after 23 minutes, but the cap instantly filled by people who had been refreshing nonstop.
To widen participation, the team planned to raise the cap to 1 billion dollars at a preset time. But someone found a way to increase the cap early and pushed it ahead of schedule.
Deposits started flowing in before anyone expected. The team scrambled and froze it at 500 million dollars. (You can read the technical details here.)
Most of the public who followed official announcements weren't able to participate.
It was full of chaos and confusion. Users were pissed off. MegaETH didn't get a wide distribution of USDm.
Finally, MegaETH announced they're fully refunding all depositors. The refund contract is under audit and will launch soon.
Instead, they'll reopen the USDC to USDM conversion bridge before the mainnet launch, which is scheduled for December.
They've said they'll "not forget" the contributions of depositors. It's not clear what benefits they'll have yet.
The reactions have been mixed.
- A very few minority questioned the team's competence due to making so many technical mistakes.
- There were some valid criticisms as well. For example, there should've been deposit caps for individual wallets.
- But by and large, most people weren't angry. They weren't able to deposit into the bridge. So they were happy with MegaETH deciding to relaunch the campaign later.
Even though the event was messy, it showed just how intense demand for MegaETH is. Despite all the glitches, both caps filled almost instantly.
The takeaway: pay close attention to this launch. When MegaETH goes live, the activity will be wild.
Sponsored by Solstice
Solstice: Solana's Institutional Grade Stablecoin
Solana needs a native stablecoin.
- >80% of Solana's stablecoin supply is USDC & USDT.
- The yield USDC & USDT generates is going to Solana competitors like Base chain.
- Solana community needs a stablecoin that'll direct the stablecoin yields into the Solana ecosystem.
Solstice Finance is winning this niche. Here's the 80/20:
- USX is their 100% collateralized USD stablecoin.
- eUSX is the yield-bearing version of USX. You get it by depositing USX into YieldVault.
- SLX is their upcoming protocol token. (You should join their points program for a juicy airdrop. Use my code: SDoYPPvDU8)
The project is expanding fast. Recently, they launched a validator cluster on Ethereum. Integrated Ethos for additional airdrop points for users. Blockfort integrated USX into its custody and settlement systems. And so on.
Right now, there's a lot you can do with USX in the Solana ecosystem.
- With the PT-USX that'll mature on February 9th, the current net fixed APY is ~15.87%.
- Kamino supports the PT-USX. So you can borrow against it and leverage your position for more exposure.
- Another opportunity is supplying eUSX to Exponent's yield market. It'll give you great rewards: ~8.38% APY & 10x airdrop points.
There are many more ways to earn additional yield and airdrop points on USX & eUSX. You can find them in the "Deep DeFi" section on Solstice.
Farms
Some Monad Eco Opportunities
Monad launched this week.
It marketed itself as the best of both Solana and Ethereum. Like Solana, it's highly performant. It claims 10k TPs and subsecond transactions. It also uses Ethereum's VM. So it can tap into the developer network effects as well.
I'd covered the Monad ecosystem in a newsletter last month. It's still a good place to start exploring the ecosystem.
On the day of launch, we'd covered top opportunities in the ecosystem in TDE Pro in a detailed post.
Today, I'll cover a few opportunities from that post.
#1. Morpho
It's a blue-chip lending protocol proven in many ecosystems. You have very little smart contract risk with it. So this is the only protocol on Monad where I feel comfortable deploying in larger sizes right now.
Right now, there are three Morpho vaults live on Monad. All of them are managed by Steakhouse, a reliable curator imo.
Including the MON rewards, the USDC & AUSD vaults are paying out 7.83% & 13.72% APY in rewards. This is a pretty good risk-to-reward ratio.
#2. Upshift
Upshift is a multi-chain DeFi vault provider securing over $500m in deposits. They offer vaults across various networks that include a wide range of strategies designed by DeFi curators.
It has built an AUSD vault on Monad.
- It earns yield for depositors by allocating AUSD deposits across the Monad ecosystem.
- Depositors also receive a liquid vault token that can be used in other Monad protocols
It has already attracted $18.33M in TVL and is earning 13.86% APY.
Upshift has been running a points program that started in April of this year. That could be attractive as well.
#3. Curvance
Curvance is a lending protocol offering isolated markets. Their focus is on capital efficiency and composability.
They only launched on the 26th, and they've already >$23M in total deposits. As part of the incentive program, they've allocated $750k+ in rewards for the first month.
Instead of individual farming, they've introduced community farming. When users complete target TVL for eligible markets, they give "bytes" to everyone who participated. These "bytes" can be converted to rewards later.
There are more opportunities on Monad that you can explore. If you're comfortable with providing liquidity,
- UniswapV4 MON-AUSD pool is offering ~$169% in APR.
- MON/AUSD Pool on Kuru is offering >107% in APR. Since this is a native DEX with no token, you can expect an airdrop as well.
-
There are LSTs, perp platforms, and other consumer apps as well. But we can't cover all of them here.
If you want a full list of Monad apps, click here.
🚀 DeFi Catalysts
Cap Money has shipped its EigenLayer Autonomous Verifiable Service (AVS). Flow Traders is onboarding as the first operator.
Binance wallet has launched onchain stocks. Users can access the tokenized stocks with a fee as low as 0%.
Polymarket has received a CFTC approval that'll allow it to operate an intermediated trading platform in the USA.
Klarna, a Swedish fintech company, introduced KlarnaUSD. It claims to be the first bank to launch on Tempo, the blockchain from Stripe.
Ethereum increased its gas limit from 45M to 60M on November 25. The chain can now process many more transactions than before.
📰 Industry News
S&P Global Ratings downgraded Tether's USDT stability assessment from "Constrained" to the lowest tier.
Paxos is acquiring Fordefi, an institutional-grade custody and wallet technology provider. This will allow Paxos to expand its offerings.
Amundi, Europe's largest asset manager, launched the first tokenized share for a Euro money market fund on Ethereum.
Upbit discloses a 54B KRW ($36M) hack on the Solana Network. Users won't have to worry since Upbit will be filling the hole.
🐦⬛ X Hits
- Macro for degens.
- The return of the supercycle.
- The big unlock of KlarnaUSD.
- Arthur Hayes on the eventual domination of perps.
- Top 5 structural problems with prediction markets.
😂 Meme
Until next time,
Edgy
Today's email was written by Edgy and Yayya.
DISCLAIMER: I'm NOT a financial advisor. This content is for education and information purposes only. Crypto and DeFi are risky and speculative. Please do your research before investing.
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