Letter From The Editor
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— Spencer Noon
🕛 About the editor: Spencer Noon is an early-stage VC at Variant
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Network Coverage: DeFi
This week our contributor analysts cover DeFi: Yearn, 0x, and Visor Finance.
📈 Yearn surpasses $5.3b in TVL, $44m in revenue
Yearn’s TVL has crossed all time highs, surpassing $5.3 billion. Yearn is currently in the early stages of a multichain push. To date, Yearn has launched Vaults and a native Iron Bank on Fantom amassing $63 million in TVL. Yearn has signaled future expansion desires onto Arbitrum, Optimism, Polygon, Avalanche and others, and is close to launching Yearn v3, a revamped UI with user experience and the multichain future in mind. These initiatives should result in sustained TVL growth.
Cumulative protocol revenue has surpassed $44.5 million. Total protocol revenue in Q3 2021 was $15.2 million, down slightly from $18.4 million in the previous quarter. However, Q3 2021 revenue was still up significantly from $5.5 million in Q1 2021 and over 470% YoY.
The Curve stETH vault has emerged as Yearn’s most popular vault measured by TVL, growing ~10x in Q3’21 to over $788m in TVL today. The Curve stETH vault uses the Curve liquidity mining program to farm CRV, LDO, and trading fees, harvesting rewards into ETH and redepositing ETH/stETH into the vault.
📈 0x API Accumulated 1.6Million+ Trader Wallets
0x API now is on 4 blockchains, surfacing 47 dApps' customers' trading demands, connected to 39 liquidity sources, which also supports multiple asset types in 1 trade (ERC20, ERC721 and more). Until today, 0x API enabled 1.6m+ DeFi users (defined as trader wallets) to place dex trades. Over 1.2m of the wallets made a trade >$1 and over 1m wallets traded more than >$10 in 1 single trade. Cohort chart shows half million of users flooded in September, mainly on Polygon and Binance Smart Chain.
Wallets behaviors differ by chain. With higher volume and frequency, Avalanche is catching up with Ethereum on daily average and median trade size; while BSC and Polygon sizes are much smaller. Zapper dominates the trade count on Polygon and their quest campaign largely fluctuates trend for Polygon.
Matcha launched gasless trading open beta 2 weeks ago on Sep 28th. Early stats shows $18.6M volume has been traded and 670+ Matcha users has benefited from this feature to trade without paying Ethereum gas fees. A total of 17.41ETH ($650k+) has been consumed and burnt, paid by 0x's Market Makers.
③ Visor Finance
📈 Visor surpasses $14m TVL & $2.5m protocol revenue
Visor Finance is a DeFi protocol for active liquidity management by using NFT smart vaults. Visor manages assets in top pools on Uniswap V3 with optimisations and market making strategies. Total Visor TVL across vaults is at an ATH of $14.4m. The ratio of liquidity added to Uniswap V3 via Visor Finance has dropped from 0.7% to 0.4% over September but has since bounced back to ~0.6%. This is directionally positive as it indicates Visor is contributing more to Uniswap V3’s total TVL.
Visor takes 10% of re-invested Uni V3 fees by buying VISR and distributing those tokens to VISR stakers. 13.3m VISR is now staked by holders wishing to receive this fee distribution. Visor has generated over $2.3m in protocol revenue to date with over $250k distributed to VISR stakers.
Vault performance for LPs vs. passive strategies is important to attract liquidity to Visor. Since the 27th of August, Visor’s WETH-USDT pool performance has underperformed versus a passive Uni V2 and ETH HODL strategy. Managers are able to refine their strategies to stay competitive over time.