Latest news with #MakerDAO
Yahoo
13-05-2025
- Business
- Yahoo
DeFi Savings Protocol Sky Slumps to $5M Loss as USDS Interest Payments Wipe Out Profit
DeFi savings protocol Sky posted a first-quarter loss of $5 million after interest payments to token holders more than doubled, according to a report created by Sky contributors from Steakhouse Financial. The loss is a stark turnaround from the previous quarter, when Sky, formerly known as MakerDAO, registered a $31 million profit. The reason for the 102% increase in interest payments is the decision to incentivize use of the protocol's newer Sky dollar stablecoin (USDS) over the existing DAI. "The Sky Savings Rate was kept very high at 12.5% relative to the rest of the market, driving massive inflows" Rune Christensen, co-founder of Sky, told CoinDesk over Telegram. When Sky began lowering interest rates to 4.5% in February, a lot of investors stuck around, he said. The situation is a double-edged sword for the protocol, which was among the first cohort of decentralized finance apps to spring up on Ethereum in 2017. Sky operates similar to a traditional bank. It needs to lend to others at a rate higher than it pays its savers. However, offering higher rates on USDS without a corresponding increase in demand for the stablecoin is hurting the protocol's profitability, PaperImperium, governance liaison at blockchain research and development company GFX Labs, told CoinDesk over Telegram. "USDS is a major drag on earnings," he said. "DAI makes money. USDS, not so much." The push toward USDS is part of Sky's so-called Endgame plan, an initiative led by Christensen aimed at transforming the protocol into a more decentralized and resilient system. When Sky rebranded from MakerDAO and launched USDS in August as part of Endgame, the plan was that the new stablecoin would appeal to a different set of users than DAI. USDS was designed to better comply with regulations and financial reporting requirements. It was targeted toward sophisticated investors like hedge funds, family offices and other institutions looking to dip their toes into decentralized finance. But it's unclear if USDS has been able to attract a substantial number of new users. The returns investors can earn on USDS comapred to DAI is different: USDS pays out 4.5%, while DAI yields 2.75%. Many investors swapped their DAI for USDS, meaning Sky had pay out more to people who previously were happy to earn a lower yield or, in many cases, no yield at all, PaperImperium said. To be sure, the report said the combined supply of USDS and DAI has increased 57% since the start of the quarter. But a large part of this increase is from Ethena, the synthetic dollar protocol. It has piled over $450 million into staked USDS, and passes the yield on to those who stake its own stablecoin, USDe. Over the past week, Ethena has switched some of its reserves from USDS to USDtb — a stablecoin backed by BlackRock's USD Institutional Digital Liquidity Fund, or BUIDL. The move means there's less USDS in circulation. But it may also benefit Sky by reducing the amount of interest the protocol must pay out. Read more: Sign in to access your portfolio
Yahoo
06-05-2025
- Business
- Yahoo
How To Pay Down Your Student Loan Debt With Crypto
Student loans have become a massive burden for millions of Americans. As of 2024, nearly 43 million borrowers owe a total of $1.77 trillion in student loans, with the majority being federal loans. Be Aware: Coinbase Fees: Full Breakdown of How To Minimize Costs Try This: The New Retirement Problem Boomers Are Facing While traditional methods of repaying student loans involve using your income to make monthly payments, you can also use crypto to tackle debt. Here are two ways to pay down student loan debt with crypto. Next, find out how you can pay your bills with cryptocurrency. Take Out a DeFi Loan DeFi, or decentralized finance, is a financial service that runs on blockchain networks, like ethereum (ETH). Unlike traditional banks, DeFi platforms don't rely on human approval. Instead, they use smart contracts to let people borrow, lend or earn interest on their digital assets. So, how do DeFi loans work? Say you have $15,000 in student loan debt and own $30,000 worth of ETH. Since you don't want to sell your ETH because you think the price will go up over time, you can use a DeFi platform like Aave or MakerDAO to deposit your ETH as collateral and borrow $15,000 in stablecoins. You can then convert the stablecoins into U.S. dollars and pay off your student loan debt. Once you repay the borrowed amount plus the interest, you get your ETH back. However, most DeFi platforms will only let you borrow 50% to 70% of your collateral's value. This is called the Loan-to-Value (LTV) ratio. If the value of your crypto drops significantly, you may be liquidated, meaning the platform sells part of your digital asset to cover the loan. Read Next: If Trump Eliminates the Department of Education, Do You Still Have To Pay Your Student Loans? Pros Lower interest rates: The first thing that makes DeFi loans attractive is the low interest rates and flexible repayment schedules. In some cases, borrowing rates are near zero. No credit score required: Since these loans are issued via smart contracts and not by financial institutions, you don't need to have a good credit score. Your crypto acts as the collateral instead of your credit history. Cons While using DeFi loans to pay down student loans has advantages, it's not without risks.
Yahoo
09-04-2025
- Business
- Yahoo
How DeFi 'Defied' Market Carnage as Traders Poured Millions Amid Panic
This week's tariff-inspired market meltdown has led to a rapid sell-off across crypto-assets, with BTC trading below $80K and ETH hitting a two-year low of $1,432. The decentralized finance (DeFi) sector was not entirely immune to the chaos as total value locked (TVL) slumped to its lowest point since November at $95 billion. But it wasn't all bad news for DeFi. Amidst plunging asset prices, DeFi showed resilience with muted outflows with key usage metrics faring far better than the price of ETH, the asset that underpins much of Ethereum's DeFi ecosystem. TVL on Aave, the largest DeFi protocol, rose in ETH terms this week as deposits hit a record high of 11.02 million ($17.32 billion). Deposits have been steadily increasing since the turn of the year when it stood at 3 million ETH. What this shows is that whilst the recent bull market was focused on hype-fueled meme coins, the real-world use case of DeFi is still very much alive. In previous cycles DeFi has suffered due to centralized exchange dominance and a lack of liquidity, now capital is flooding in as traders deploy delta-neutral strategies, which increases liquidity on the long-term health of DeFi. As the market edges closer to bearish territory, DeFi may well be one of the pillars keeping crypto afloat. Aave was not the only protocol to experience inflows this week. TVL on Sky - formerly MakerDAO – increased from 1.85M ETH to 4.63M ETH. Lending protocol Spark also had a 1 million ETH boost in deposits earlier this month, according to DefiLlama. The rush to DeFi during a market sell-off can be attributed to traders looking to de-risk, moving to stablecoins to acquire a delta-neutral yield through lending and borrowing instead of holding spot exposure during a volatile market. Decentralized exchange volumes have also remained steady, hitting $11.8 billion on Monday and $9.8 billion halfway through Tuesday compared to last week when volumes failed to top $7 billion on any single day. Sign in to access your portfolio
Yahoo
08-04-2025
- Business
- Yahoo
Tariff Fallout Slaps Ether Bulls With Looming $100M Liquidation
Analysis of on-chain data curated by DefiLlama shows that nearly $100 million in ether (ETH) positions are at risk if the price slides by 15%. Traders in Asia faced a sea of red during the Monday business day as the ripple effects of U.S. President Donald Trump's tariff policy were felt around the world. ETH is down nearly 16% Monday, according to CoinDesk data, now trading above $1490, while the CoinDesk 20 index is down 13%, and market participants fear that the U.S. open could bring more pain. Should the U.S. open bring another 15% drop in ETH's price, sending it below $1,274, more than $100 million in leveraged positions could face imminent liquidation. On-chain liquidations are potentially more impactful than those related to derivatives as it involves spot assets being sold onto the market. In MakerDAO's case, a liquidated position is auctioned off at a cheaper rate to traders who can then sell at a relative premium, flooding the market with supply and creating more sell pressure. One wallet which would get liquidated at $1418 had a number of close calls Monday but trimmed its holdings of ETH and paid back repaid some of the DAI it owed. DeFiLlama data also shows that should the price of ETH sink by 20%, another $36 million is at risk. The largest single ETH position, with $147 million in collateral locked, has a strike price of $1,132. Lending protocols were some of the hardest hit tokens during the Monday Asia trading day, with CoinGecko data showing that the category is down 17% on-day as concern grows about the health of levarage around some positions. Sign in to access your portfolio
Yahoo
27-02-2025
- Business
- Yahoo
Crypto Daybook Americas: Risk-Off Remains the Theme as Market Settles
By Omkar Godbole (All times ET unless indicated otherwise) The crypto market is looking to regain some poise after yesterday's tumble with on-chain indicators showing signs of capitulation in bitcoin. Some tokens, like MakerDAO's MKR, stand out with a 20% gain in 24 hours, thanks to the DAO's buyback and burn process. IP, the native token of decentralized intellectual property-focused blockchain Story Protocol, is also in the green, having risen nearly 40%. The token's price has doubled in two weeks after being listed on South Korean exchanges. Other notable outperformers include Celestia's TIA along with XDC, QNT and HYPE. Data tracked by blockchain sleuth Lookonchain shows whales have been buying the dip in the HYPE token. XRP, meanwhile, is hanging on to a key Fibonacci level, keeping bulls' hope for bigger gains alive. According to Matthew Hougan, chief investment officer of Bitwise Asset Management, the crypto market is digesting the end of the recent memecoin frenzy, which could be replaced by productive sectors such as stablecoins, real-world assets and DeFi. "But until they start making their presence felt, the loss of energy will create a drag on the market," Hougan said on X. On the macroeconomic front, the optimism seen after the Nov. 4 election is being replaced by caution, as evidenced by Tuesday's release of the U.S. consumer confidence. The gauge dropped to an eight-month low, and the one-year inflation expectations were highest for 1.5 years, with President Donald Trump's tariffs singled out as the primary concern in almost every household and business survey. The dour sentiment and a strengthening yen might keep the upside in risk assets restricted for some time. Earlier this week, Belgium's central bank's head, Pierre Wunsch, warned that the ECB risks sleep-walking into too many rate cuts. The Fed, for its part, is unlikely to do QE anytime soon. (Sure, the January meeting minutes discussed an end of quantitive tightening, but that does not mean quantitative easing.) Speaking of key events to watch out for, the Senate Banking Committee, led by Senator Cynthia Lummis, is set to revisit crypto regulations during Wednesday's scheduled hearing titled 'Exploring Bipartisan Legislative Frameworks for Digital Assets." Stay alert! Crypto: Feb. 26, 8:30 a.m.: Cosmos (ATOM) network upgrade (to version v22.2.0). Feb. 26: RedStone (RED) farming starts on Binance Launchpool. Feb. 27, 4:00 a.m.: Alchemy Pay (ACH) community AMA on Discord. Feb. 27: Solana-based L2 Sonic SVM (SONIC) mainnet launch ('Mobius'). March 1: Spot trading on the Arkham Exchange goes live in 17 U.S. states. March 5 (provisional): At epoch 222464, testing of Ethereum's Pectra upgrade on the Sepolia testnet starts. Macro Feb. 26, 10:00 a.m.: The U.S. Census Bureau releases January's New Residential Sales report. New Home Sales Est. 0.68M vs. Prev. 0.698M New Home Sales MoM Prev. 3.6% Feb. 26-27: 2025's first G20 finance ministers and central bank governors meeting (Cape Town). Feb. 27, 8:30 a.m.: The U.S. Bureau of Economic Analysis releases Q4 GDP (2nd estimate). Core PCE Prices QoQ Est. 2.5% vs. Prev. 2.2% PCE Prices QoQ Est. 2.3% vs. Prev. 1.5% GDP Growth Rate QoQ Est. 2.3% vs. Prev. 3.1% Feb. 27, 8:30 a.m.: The U.S. Department of Labor releases Unemployment Insurance Weekly claims for the week ended Feb. 22. Initial Jobless Claims Est. 221K vs. Prev. 219K Earnings Feb. 26: MARA Holdings (MARA), post-market, $-0.13 Feb. 26: NVIDIA (NVDA), post-market, $0.85 Governances votes & calls Frax DAO is discussing upgrading the protocol by renaming FXS to FRAX, making it the gas token on Fraxtal, implementing the Frax North Star hard fork, and introducing a tail emission plan with gradually decreasing emissions and other enhancements. DYdX DAO is voting on distributing $1.5 million in DYDX tokens from the community treasury to qualifying users in trading season 9 as part of its incentives program. Unlocks Feb. 28: Optimism (OP) to unlock 2.32% of circulating supply worth $33.97 million. Mar. 1: DYdX to unlock 1.14% of circulating supply worth $5.76 million. Mar. 1: ZetaChain (ZETA) to unlock 6.48% of circulating supply worth $12.81 million. Mar. 1: Sui (SUI) to unlock 0.74% of circulating supply worth $68.90 million. Mar. 2: Ethena (ENA) to unlock 1.3% of circulating supply worth $16.47 million. Mar. 7: Kaspa (KAS) to unlock 0.63% of circulating supply worth $14.85 million. Mar. 8: Berachain (BERA) to unlock 9.28% of circulating supply worth $70.90 million. Token Listings Feb. 26: Moonwell (WELL) to be listed on Kraken. Feb. 27: Venice token (VVV) to be listed on Kraken. Feb. 28: Worldcoin (WLD) to be listed on Kraken. CoinDesk's Consensus to take place in Toronto on May 14-16. Use code DAYBOOK and save 15% on passes. Day 4 of 8: ETHDenver 2025 (Denver) March 2-3: Crypto Expo Europe (Bucharest, Romania) March 8: Bitcoin Alive (Sydney, Australia) March 10-11: MoneyLIVE Summit (London) March 13-14: Web3 Amsterdam '25 (Netherlands) March 19-20: Next Block Expo (Warsaw, Poland) March 26: DC Blockchain Summit 2025 (Washington) March 28: Solana APEX (Cape Town, South Africa) By Francisco Rodrigues Solana, often criticized over its inflationary monetary policy, is currently considering implementing a governance proposal to change it, SIMD-0228. The proposal would introduce a dynamic, market-driven emissions model for SOL tokens and potentially reduce inflation. The proposal would move the blockchain away from its current fixed emissions model that has seen SOL's circulating supply increase to around 500 million tokens. Elsewhere Story Protocol's token, IP, has been bucking the bearish trend that gripped the cryptocurrency market over the last few days. IP outperformed the broader CoinDesk 20 Index as traders bet on the tokenization of intellectual property. The industry ecosystem is also rallying behind cryptocurrency exchange Bybit after its $1.5 billion hack. The exchange has launched a 'war against Lazarus' to crowdsource investigative efforts against the North Korean-linked group. BTC's one-month CME futures basis has dropped to 4%, the lowest in nearly two years, according to Velo Data. That's a sign of weakening bullish sentiment. Ether's basis has dropped to just over 5%. Perpetual funding rates for TRX, AVAX, XLM, SHIB and OM are negative, reflecting a bias for bearish short positions. BTC, ETH short-term puts continue to trade at a premium to calls, reflecting fears of a continued price drop. BTC is up 1% from 4 p.m. ET Tuesday at $89,19377 (24hrs: -0.11%) ETH is down 0.36% at $2,487.88 (24hrs: +2.19%) CoinDesk 20 is up 0.42% at 2,882.89 (24hrs: +2.34%) Ether CESR Composite Staking Rate is up 29 bps at 3.28% BTC funding rate is at 0.0005% (0.6% annualized) on OKX DXY is up 0.17% 106.49 Gold is down 0.24% at $2,913.89/oz Silver is down 0.78% at $31.78/oz Nikkei 225 closed -0.25% at 38,142.37 Hang Seng closed +3.27% at 23,787.93 FTSE is up 0.54% at 8,715.19 Euro Stoxx 50 is up 1.14% at 5,510.13 DJIA closed on Tuesday +0.37% at 43,621.16 S&P 500 closed -0.47% at 5,955.25 Nasdaq closed -1.35% at 19,026.39 S&P/TSX Composite Index closed +0.21% at 25,203.98 S&P 40 Latin America closed +0.19% at 2,390.95 U.S. 10-year Treasury rate is up 2 bps at 4.32% E-mini S&P 500 futures are up 0.5% at 5,999.75 E-mini Nasdaq-100 futures are up 0.82% at 21,321.50 E-mini Dow Jones Industrial Average Index futures are up 0.27% at 43,808.00 BTC Dominance: 61.11 (0.13%) Ethereum to bitcoin ratio: 0.02793 (-0.75%) Hashrate (seven-day moving average): 746 EH/s Hashprice (spot): $52.40 Total Fees: 11.39 BTC / $1.1 million CME Futures Open Interest: 164,970 BTC BTC priced in gold: 30.5 oz BTC vs gold market cap: 8.66% Bitcoin's hourly chart shows the MACD histogram has been biased bullish since late Tuesday. Still, there has been little progress to the upside in terms of price. The divergence between prices and MACD, coupled with the downward sloping key averages, suggests potential for another round of selling before a meaningful bottom is reached. A convincing move above $90,000 is needed to invalidate the bearish outlook. MicroStrategy (MSTR): closed on Tuesday at $250.51 (-11.41%), up 3.66% at $259.68 in pre-market Coinbase Global (COIN): closed at $212.49 (-6.42%), up 2.04% at $216.82 Galaxy Digital Holdings (GLXY): closed at C$20.09 (-7.84%) MARA Holdings (MARA): closed at $12.41 (-10.62%), up 2.86% at $12.77 Riot Platforms (RIOT): closed at $9.32 (-6.71%), up 2.79% at $9.58 Core Scientific (CORZ): closed at $9.76 (-1.01%), up 3.28% at $10.08 CleanSpark (CLSK): closed at $8.15 (-8.43%), up 1.96% at $8.31 CoinShares Valkyrie Bitcoin Miners ETF (WGMI): closed at $17.04 (-11.25%), up 4.46% at $17.80 Semler Scientific (SMLR): closed at $42.42 (-4.42%), up 2.5% at $43.48 Exodus Movement (EXOD): closed at $39.86 (-3.16%), down 1% at $39.46 Spot BTC ETFs: Daily net flow: -$937.7 million Cumulative net flows: $38.09 billion Total BTC holdings ~ 1,157 million. Spot ETH ETFs Daily net flow: -$50.1 million Cumulative net flows: $3.02 billion Total ETH holdings ~ 3.750 million. Source: Farside Investors The net selling volume in BTC on Tuesday was the strongest since May 2021, according to data tracked by Glassnode and Andre Dragosch, head of research for Europe at Bitwise. Perhaps weak hands have capitulated, leaving the market in a much healthier state. XRP, BNB Edge Higher as Bitcoin Bulls Eye $90K After Tuesday Bloodbath (CoinDesk): Bitcoin rebounded to nearly $89,000 with major cryptocurrencies XRP and BNB also showing signs of a cautious recovery. Bitcoin's Tuesday Bloodbath Was the Bottom, Analyst Says (CoinDesk): On-chain signals suggest limited further downside. U.S. Bitcoin ETFs See Record Daily Outflow of Over $930M as Carry Trades Lose Shine to the 10-Year Treasury Note (CoinDesk); Tuesday marked the steepest single-day redemption for U.S.-listed spot bitcoin ETFs since their inception. Circle Says Stablecoin Issuers Should Be U.S. Registered (Bloomberg): Jeremy Allaire, co-founder of stablecoin issuer Circle, said issuers of dollar-pegged crypto tokens should be registered in the U.S. Treasury Yields Rebound Slightly, Dollar Undermined by US Growth Worries (Reuters): The 10-year Treasury yield climbed 3 basis points to 4.3271% after the U.S. House passed a budget bill that paves the way for $4.5 trillion in tax cuts. Top Finance Ministers Snub G20 as Global Co-Operation Comes Under Strain (Financial Times): This week's G20 meeting in South Africa is notable for the absence of finance ministers from the U.S., China, Japan, India, Brazil and Mexico, prompting doubts about the forum's effectiveness. Sign in to access your portfolio
