DeFi Weekly Review: Wormhole Reclaims $1B, Hedera Approves $408M, and dYdX Surpasses Uniswap
Summary:
This week in decentralized finance (DeFi), major events included the Wormhole bridge reclaiming $1 billion in total value and the Hedera Governing Council approving a $408 million allocation for ecosystem growth. Amidst the overall market bearish trend, Fidelity projected that an expected Federal Reserve rate cut could reinvigorate institutional interest in DeFi and stablecoins. On the Avalanche blockchain, record user interest has been observed following the success of Bitcoin Ordinals and BRC-20 tokens. Meanwhile, the cross-chain protocol Wormhole's total value locked has bounced back to $1 billion post a two-year slump, and Cosmos-powered DeFi protocol dYdX surpassed Uniswap in daily trading volume. Despite a bearish week for the top 100 DeFi tokens, over $65 billion remains locked into DeFi protocols.
Finance Redefined welcomes you back, providing indispensable insights from the world of decentralized finance (DeFi) every week. This newsletter is designed to deliver the week's foremost happenings. The previous week saw some major shifts in the DeFi market, such as the Wormhole bridge reclaiming its $1 billion total value almost two years post-hack. Additionally, we saw the Hedera Governing Council's influence. The top-100 DeFi tokens experienced a bearish trend mirroring the overall market sentiment, with most tokens experiencing a dip.
The Hedera Global Governing Council, which supervises the Hedera network, has endorsed allotting 4.86 billion of Hedera (HBAR) tokens (~$408 million) to expand the ecosystem and implement advanced decentralized governance. According to a blog update by the council, the major chunk of the funds, precisely 4.248 billion HBAR, is aimed at bolstering ongoing initiatives, including those launched by the HBAR Foundation, the Hashgraph Association, and the DLT Science Foundation.
An anticipated rate slash by the US Federal Reserve could stimulate renewed institutional engagement in DeFi and stablecoins in 2024, provided the infrastructure is sufficiently developed, states asset management giant Fidelity. In a report discussing digital asset prospects for 2024, Fidelity has speculated that while it imagined institutions would plunge into DeFi for its returns in 2023, the climb in Fed rates had driven them towards traditional fixed-income products deemed to be safer.
Inscriptions on the Avalanche blockchain are attracting record-breaking user interest, following the success of Bitcoin Ordinals and BRC-20 tokens (inscription tokens). A Twitter Space chat session in Chinese, organized by Bitget crypto exchange and discussing Avalanche-friendly Avascriptions (AVAV) tokens, pulled in over 585,000 listeners recently. AVAV project executive, Ori, announced that the project would draw parallels with the BRC-20 asset progression, highlighting that Avalanche has seen over 100 million inscriptions since it began in June 2023.
Following a nearly two-year slump due to the cryptocurrency bear market that began in May 2022, the Wormhole cross-chain protocol has recouped its total value to the tune of $1 billion. Currently, the protocol illustrates a balance of $1.02 billion, majorly stemming from Ether (ETH), Fantom (FTM), and Solana's SOL assets, indicating a 300% increment from a year-start low of $234 million. The protocol had previously reached its pinnacle at $3.8 billion, 16 months ago, ahead of the Terra ecosystem collapse and the onset of the crypto winter.
The Cosmos-platform DeFi protocol dYdX has outperformed a Uniswap market in terms of the largest decentralized exchange in 24-hour trading volume. Data source CoinMarketCap demonstrated that dYdX's interchain protocol Cosmos-founded v4 version saw about $757 million in trading volume in 24 hours. Meanwhile, the Ethereum marketplace of Uniswap v3 only clocked around $608 million in the same timeframe.
Meanwhile, data analytics from Cointelegraph Markets Pro and TradingView reveal a bearish week in the DeFi market, with the top 100 tokens showing a downtrend. However, the total value locked into DeFi protocols hovers above the $65 billion mark.
That wraps up the major highlights from the DeFi world this week. Tune in next Friday for more fascinating updates, insights, and knowledge from this fast-evolving domain.
Published At
1/19/2024 10:20:00 PM
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