DeFi Week: Multichain Glitch Exploited for $1.9M, Solana Rises 80%, Avalanche Explorer Shuts Down
Summary:
This week in decentralized finance (DeFi), a trader exploited the brief unfreezing of the Multichain cross-chain bridge, turning $280,000 into $1.9 million in different assets. Solana's token has seen an 80% increase in a month, and Avalanche plans to retire its Etherscan-powered blockchain explorer amid fee issues. A new bridged token from LayerZero has faced criticism from nine Ethereum ecosystem protocols. The top 100 DeFi tokens maintained their bullish trend, with a majority demonstrating positive returns over the week.
Say hello to Finance Redefined, a weekly compilation of important decentralized finance (DeFi) updates — a newsletter tailored to keep you informed about the major happenings this week. An opportunistic trader took advantage of the temporarily unfrozen Multichain cross-chain bridge, which had been on hold since a security breach in July 2023. The trader transformed $280,000 worth of Fantom’s (FTM) tokens into $1.9 million in various assets. Elsewhere, Solana’s (SOL) token value shot up by 80% within a month, and Avalanche is preparing to decommission its Etherscan-backed blockchain explorer amidst a fee dispute. Meanwhile, a novel bridged token from LayerZero is under fire from nine protocols in the Ethereum network, as they argue it restricts the abilities of token issuers. As we wrap up the week, the top 100 DeFi tokens sustained their upward trajectory from last week with favourable returns for the majority on the seven-day charts.
Trader capitalizes on Multichain glitch to transform $280,000 to $1.9 million; insiders questioned
A wallet address capitalized on a momentary unfreezing of the Multichain bridge, transforming close to 1.9 million FTM worth $280,000 into $1.9 million within hours sparking suspicions of insider involvement amongst the crypto community. The trader made good use of the fleeting opening of the Multichain bridge, which hadn't been open since its July 2023 security breach, to rake in millions in profit.
Solana increases 80% in a month as Firedancer launches on beta
SOL has scored gains close to 81% on the 30-day scale and soared over 30% this past week as the highly-anticipated scaling solution, Firedancer, launches its beta. On Nov. 2, SOL hit a peak of over $41, a price not witnessed since August 2022 according to Cointelegraph Markets Pro data. Coined an "Ethereum killer", SOL has significantly surpassed its competitor, Ether (ETH) which only managed gains beneath 11% over the month.
Avalanche blockchain explorer to cease operation due to Etherscan fee issues
SnowTrace, a widely used blockchain explorer tool for Avalanche, announced its exit from the scene on Nov. 30. The SnowTrace team stated that only its Etherscan-run explorer would be retired. Based on the Oct. 30 announcement, SnowTrace users must ensure their backup details, such as private name tags, and verification contacts are downloaded before Nov. 30. While the precise reason behind the explorer's shutdown remains unclear, it seems to be tied to Etherscan's service charges for its explorer-as-a-service (EaaS) toolkit. Mikko Ohtama, a co-founder of Trading Strategy, states that an annual EaaS subscription can cost from $1 million to $2 million.
Nine protocols challenge LayerZero’s wstETH token, labeling it as "proprietary"
The cross-chain protocol LayerZero's newly introduced bridged token has garnered criticism from nine Ethereum network protocols. A united response from Connext, Chainsafe, Sygma, LiFi, Socket, Hashi, Across, Celer, and Router on Oct. 27 called the token's standard a "procurer-bound proprietary standard," asserting that it curbs the rights of token issuers. These protocols allege that LayerZero’s new token is a "proprietary depiction of wstETH to Avalanche, BNB Chain, and Scroll without the endorsement of the Lido DAO [decentralized autonomous organization]", and is produced by “specifically owned systems by the bridges that employ them.” This, they argue, creates “undeterminable systemic risks for projects”. The protocols propose the use of the xERC-20 token standard for bridging stETH instead of using LayerZero's token.
DeFi market synopsis
Data from Cointelegraph Markets Pro and TradingView depicts a robust week for DeFi's top 100 tokens by market capitalization, with a majority showing green on the weekly charts. The total value invested in DeFi protocols rose to $49.46 billion.
That's all for this edition of Finance Redefined. Tune in next Friday for more insights, updates and knowledge concerning this rapidly evolving sector.
Published At
11/3/2023 7:25:00 PM
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