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The state of LP in 3 numbers

PoolFish Updates | Solana DEXs > Uniswap?

Total Volume + Fees

Welcome back LPs, especially the ones who are dreading the meteoric rise in the past few days given their IL. If you are Hodling, then you might just want to stick with BTC and ETH. However, if you're here for the explosive potential of LPing, then buckle up, because we're about to take off!

We take a look at some historical data to ascertain the prospects of being an LP in Defi, which protocols to diversify in, why Solana may not be an ETH killer but a completely different beast on its own and why you should keep an eye out for PoolFish's new arsenal of tools.

On the docket this week:

  • State of the LP in 3 numbers and why you should get excited

  • SOL DEXs go through the roof!

  • Major PoolFish Updates

  • KyberSwap saga

Defi in 3 numbers

TVL - It's climbing!

As Dogetoshi among others states, that akin to Uniswap's airdrop in 2021, that ignited the Defi Summer, which saw TVL soaring in a span of weeks and carried the bull market, the recent announcement of JITOsol Liquid Staking token has done the same this winter.

This time around, we have established and much used L2s like Arbitrum and Base on Uniswap. Arb on Uniswap is ranking at number 4 of all the Dexs' trading volume, currently sitting at $2.346 billion. If we were to jump back to this time last year, the TVL was merely half of today. This signals, that Defi protocols are cool once again. Only this bull market is not a by product of trillions of dollars being injected into the economy though stimulus checks, but rather new innovations being launched.

As a whole the TVL for Defi protocols sits at around $50 billion; less than 1/3 of all time high during the 2021 bull market. This tells us how much more room there is to grow for these protocols.

The growth potential of DeFi extends beyond attracting new speculators. Instead, it is fueled by innovative, real-world use cases like DeSci, as outlined by Alex Wacy. These applications encompass diverse fields like longevity, data, and biology, while also offering unique opportunities for liquidity providers to share in the rewards of research breakthroughs.

Crypto and DeFi have evolved at an unprecedented pace since the last bull run, unlocking global participation in DeFi protocols. The middle layer facilitating this liquidity and token exchange is powered by LPs like us, motivated by earning fees.

LP Fees

In a world where Blast L2 now has > $800 million in TVL, the demand for Uniswap and other AMMs like Orca have not slowed down and LPs are continuing to be profitable

The LP landscape is evolving rapidly, and one of the most notable trends is the increasing demand for liquidity from institutions rather than individual investors.

Recently Uniswap announced a partnership with an investing firm called Talos, letting them use their APIs to access liquidity which in some cases fares better than CEXs. What this means is that the demand for liquidity will keep on rising and DEX liquidity will be in demand from more sophisticated and volume consuming Tradfi institutions.

Trading Volume

Just within the Ethereum ecosystem there have been significantly more activity within Dapps built on EVM chains. Everything from bridging and swapping generates fees for LPs and signals that the ecosystem is alive and people are engaging with it. In just the last 7 days, DEXs have had a weekly volume of ~$25.8 billion, which is a rise of ~37% week over week!

If that doesn't tell you that the market is ecstatic right now, then here is some more signal:

This chart by sixdegrees on the right suggests that the number of transaction on DEXs is growing at a steady pace and if crypto adoption continues throughout the next few years, it might be exponential.

While this one on the left shows that the number of new adopters remains steady, meaning more and more people are now interacting with blockchain apps.

Recently we are seeing novel cases such as Multibit (MUBI), known for its bridging capabilities between ERC20s(ETH) and BRC20s(BTC) has been one one of the most widely traded asset pairs (WETH/USDC) with a trading volume of $68.28 Million just in the last 7 days. And it has raked in more than $680,000 for LPs in the last 7 days as well.

And we haven't even talked about Solana

JITOsol, a liquid staking platform just made their airdrop available causing a surge in the whole market. JITO already has > 6M Sol staked and has given the Solana ecosystem a new life.

JITOsol has become one of the most widely staked protocols in Defi and JITOsol is already one of the most popular pools on Orca, while at the same time taking the trading volume to all-time-highs. This caused the price of Solana to balloon up to $73. Just to give perspective, this a 15% increase in a single day! While the JITO token, intended for the governance of the protocol has also fared incredibly well.

Peer into Pool Profits with PoolFish Position Explorer

Let's say you'd like to see which of the top positions are opened in a pool. And maybe you'd like to see a big picture of where the liquidity is concentrated within the pool WETH/USDC along with. Well, you would love what PoolFish has in store for you in the coming days.

You'll be able to see all of the best performing positions. We're starting out with Uniswap Mainnet and then adding other chians. You'll be able to explore how people are performing with all necessary information like the age of their position, their APY, and PnL. It's not quite ready yet but stay tuned!

KyberSwap

The KyberSwap exploiter has gone rogue. This fishy villain has a complete disregard for people's money and is not willing to settle for anything less than a complete take over the KyberSwap AMM.

In one of the most bizarre on-chain messages in history, but admittedly in a sophisticated fashion, the Kyber Exploiter was willing to compensate the company, its stakeholders and employees their losses as well as...severance packages... Then in the same breath promises LPs only half of their assets, telling them its more than they deserve.

This is a reminder that interacting with any Dapp without understanding the smart contract is essentially a form clicking 'accept' on terms and conditions, with all risk on part of the consumer/LPs. Although the casual user cannot be expected to understand and scrutinize every part of the software that they consume.

So far Kyber clawed back $5M through some snazzy front-running maneuvers, while they exploiter has been trying to move money around to different wallets. We are sure there is more happening in the background, but till this resolves...the saga continues...

Top Pools of the Week

High-Risk

ETH/TITANX in the exotic pairs category for the ones feeling adventurous.

Low-Risk

GNO/ETH for the balanced swimmers.

Safe

ETH/USDT in the 5bps category for the cautious paddlers.

And this was our report for the state of LP in 3 numbers Let us know by replying to this email what you thought about this. Till next time Happy LP-ing!

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