Weekly DeFi/NFT News — October 12, 2021

Weekly DeFi/NFT news is a collection of major weekly events/announcements brought from the most trustworthy data sources, such as The Defiant, Spencer Noon, Week in Ethereum News etc. with comments and extra insight from the Bulldax DeFi labs.

“The Case for Clean Money” — MakerDAO fights climate change.

• Rune Christensen wants MakerDAO to fix climate change with a new essay on how DAI could be used to drive investment in clean energy.
• “MakerDAO is in the position to use the most powerful tool ever invented to fight the most challenging problem ever faced — all it takes is the will of a community.” — R. Christensen.

• “Grasping climate alpha early is likely the largest economic opportunity that will exist over the next decades because of how bad things are getting — like discovering bitcoin in 2010 but at the macro level.”
• “Climate alpha” is the return that investors will reap when they take a bet on companies that have factored climate change into their business plans. By and large, most investor theses do not factor in the long term costs of destructive behavior nor the long term gains of constructive behavior, in environmental terms. In Christensen’s mind, the market will rapidly catch up to the reality of climate change at some point in the near future, and those who bet on addressing sustainability early stand to make dramatic gains — The Defiant reports.
• “Maker and Dai can coordinate the global build-out of sustainable energy pathways by funneling billions of dollars into senior credit positions for projects that will build solar farms, wind turbines, batteries, recharging stations and other cost-efficient renewable energy solutions, as well as their supply chains, sustainable resource extraction and recycling.”
• “Renewable energy alone isn’t enough to achieve a sustainable economy, but it is an area that Maker is well positioned to deal with, as it allows Maker Governance to build up specialized expertise for risk assessments within a well defined market that is commoditized and highly scalable.”
• Christensen estimates that if the DAO aligns around taking climate action quickly, it could reallocate $3B of its exposure to Circle and Coinbase’s fiat-backed stablecoin, USDC, to environmental, social and governance bonds.

Sources: 1. https://forum.makerdao.com/t/the-case-for-clean-money/10684
2. https://thedefiant.io/makerdao-climate-change/

MoneyGram launches USDC settlement using the Stellar blockchain

• According to Cointelegraph the partnership will enable MoneyGram customers to fund and withdraw from their accounts using the USDC stablecoin at physical branches.

MoneyGram launches USDC settlement using the Stellar blockchain

• Financial services company MoneyGram International has partnered with the Stellar Development Foundation to enable consumers to send money using Circle’s popular stablecoin, USD Coin (USDC), and convert directly to and from fiat.
• “As crypto and digital currencies rise in prominence, we’re especially optimistic about the potential of stablecoins as a method to streamline cross-border payments,” said Alex Holmes, chairman and CEO of MoneyGram.

Source: https://cointelegraph.com/news/moneygram-launches-usdc-settlement-using-the-stellar-blockchain

Abracadabra’s Stablecoin Races Past $1B and Sparks Talk of Overtaking MakerDAO- The Defiant

• MIM, issued by lending protocol Abracadabra, broke $1.29B in supply on Oct. 12, placing it seventh overall in terms of stablecoin market cap, according to CoinGecko.
• Yet even though it’s behind DAI’s in supply, Abracadabra has surpassed the lending incumbent in terms of fees generated, according to the site byebyedai.money.

https://www.byebyedai.money/

• Fees on Abracadabra come from the interest paid on the protocol’s loans. If holders of SPELL, Abracadabra’s governance token, stake their asset they receive sSPELL, which accrues 75% of the interest fees.
• At $0.02 USD, SPELL is up by almost 500% in two weeks.

Differences from DAI

• 1st, Abracadabra accepts almost exclusively interest-bearing tokens as collateral. For example, a user can deposit xSUSHI, which entitles its holder to fees from decentralized exchange SushiSwap into Abracadabra. The user can then borrow MIM against xSUSHI.
• Secondly, Abracadabra’s success is its focus on deploying to multiple blockchains. Abracadabra is available on Ethereum, Fantom and Arbitrum, an Ethereum Layer 2.
• Lastly, its generous fee structure. By giving a generous 75% of the interest payments on Abracadabra loans to SPELL stakers, so by another name sSPELL holders, the upstart lending protocol shares more fees than MakerDAO shares with MKR holders.
• The fight for dominance is on.

Gelato raises $11M from heavyweight backers for Web 3.0 automation — Cointelegraph

• Gelato aims to simply DeFi by automating smart contract operations and helping users rebalance their portfolios.

Gelato raises $11M from heavyweight backers for Web 3.0 automation

• Gelato has raised $11 million in a Series A funding round led by Dragonfly Capital and with participation from ParaFi Capital, Nascent, IDEO CoLab Ventures and Aave founder Stani Kulechov.

• Gelato automates Ethereum smart contract operations by using what it calls “arbitrary logic” and bots. Its most prominent use case is addressing liquidity and volatility issues with cryptocurrency trading. The protocol can protect traders from severe losses by automatically rebalancing portfolios and executing trades on their behalf.
• Third-party servers and systems are required to monitor smart contracts and conditions for their execution. Gelato does away with the intermediaries by using a decentralized network of bots to carry out these operations, simplifying decentralized finance (DeFi) for end-users.
• In June, Gelato introduced an automated liquidity manager for Uniswap called G-UNI, which combined the capital efficiency of Uniswap v3 with the user experience of v2.
• The Gelato Network currently supports smart contracts on Ethereum, Polygon and Fantom and will add additional support for Binance Smart Chain, Arbitrum, Optimism and Avalanche.

Source: https://cointelegraph.com/news/gelato-raises-11m-from-heavyweight-backers-for-web-3-automation

Polygon Hikes its Minimum Gas Price by 30x in Bid to Foil Spammers — The Defiant

• Polygon, the sixth-largest blockchain by assets locked, is increasing the minimum gas price for transactions on its network by a factor of 30.
• The move comes as the network recently surpassed Ethereum in terms of Daily Active Addresses and is intended to reduce the number of spam transactions on the network.

• There have been increasing numbers of spam transactions reported since the explosion in DeFi activity on the network earlier this year. In one curious case, a user was found to be repeatedly sending zero value transactions to themselves.
• Nearly all of the responses to the forum post disagreed with the decision. Some community members opined that the hike was too drastic given that the network has not been overly congested recently.

• Others took issue with the manner in which the decision was taken, pointing to the centralization of power held Polygon team’s hands.

Source: https://thedefiant.io/polygon-transaction-fee-hike/

Near protocol shoots up in TVL, transactions, developer activity — Spenser Noon.

• The NEAR ecosystem is exploding — having grown by 182% from August, NEAR has reached 1M total addresses. The increase is the result of multiple factors.
• There have been a series of high-quality project launches and partnership initiatives over the past few months, including Metapool, grants with Filecoin, Vorto Games partnerships.

• TVL on NEAR is increasing with momentum gained by all projects. Rainbow bridge TVL experienced 10x growth in September, ranked as one of the top growth among bridges. In addition to the record on DeFi Llama, Cheddar.farm has over $7M, and Skyward has $15M, in total surpassing 100M TVL on NEAR.

• Monthly Active Developer reached almost 1000 with an average MoM growth of 30% from May.

Source: Spenser Noon newsletter Issue #92.