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Welcome back to 0xResearch. Here's what we’ve got for you today:
Four conferences in one
API3 goes for OEV
Banish the active address metric
Cega’s spin on Pendle
Two full days into EthCC and I can safely say it is impossible to keep up with the activity in the Ethereum space. The side events alone are like three whole other conferences going on in parallel.
It’s like if summer blockbuster fans faced new installments from the MCU, DC Comics, Star Wars, Mission Impossible and Transformers (or whatever your preferred Hollywood franchise), all released on the same weekend!
For example, yesterday featured dueling full-day tracks called “Restaking Day,” as well as another “Restaking & Infra Day.”
I feel like I need a Dark Matter style, human-sized quantum superposition box to dispatch some copies of myself around town to take notes.
To all the events which I RSVP’d for and then didn’t manage to get to — je suis désolé et het spijt me (sorry).
Today, Joe Lubin, Gavin Wood and Vitalik Buterin spoke back-to-back to a full house in the largest hall. Afterwards, the three Ethereum co-founders posed for a rare photo together and — like they were rockstars — everyone collectively pulled out their phones for a personal momento.
OEV comes to API3
Oracle provider API3 has launched the OEV Network mainnet, using the Arbitrum Orbit tech stack. The goal is to help DeFi projects recapture millions lost to oracle extractable value (OEV).
OEV refers to the profit that can be extracted from oracle updates, particularly in liquidation events. The OEV Network aims to create an efficient market where searchers bid for oracle updates and return the value from these auctions to the originating dapps and DeFi protocols.
As a case study, API3 cites the borrow/lend dapp, Venus, which it said has paid over $96.6 million in searcher incentives, averaging $2.35 million monthly. The OEV Network could recapture up to 90% of this value, allowing protocols to reinvest in their operations and become more competitive.
Any protocol that opts into API3’s price feeds can reclaim lost value across supported chains. API3 primarily operates on and supports EVM-compatible chains.
API3 is currently the sixth-largest EVM-focused oracle network, with over $1.1 billion secured.
From modularity to restaking, to the intersection of AI and crypto, to the long-awaited consumer-facing apps to the most recent Bitcoin-related innovations.
We’ll be breaking down all of these and more with the help of a few of the thought leaders in crypto at Permissionless.
Active addresses are not meaningful:
UXLink, a Web3 social platform, contributes about half of Arbitrum's active addresses but only 5% of the transaction fees. This disparity highlights the limitations of active address metrics, which can easily be manipulated and do not accurately reflect meaningful activity on the network.
While not necessarily malicious, overuse of the metric offers little value in assessing the true health of a blockchain ecosystem.
Transaction fees are a more reliable indicator of genuine network utilization and economic activity, providing a clearer understanding of the network's performance and user engagement.
Pendle Finance, with its YT token offering, has been on point throughout the airdrop farming points phenomenon this past year. Rather than merely being used for “yield trading,” these YT tokens have served as a leveraged bet on the value of future points-driven airdrops from the likes of EtherFi and Ethena.
But there’s a catch. YT tokens are designed to trend towards zero at expiry, so buyers have to weigh the cost to acquire the tokens against the uncertain “yield” to be had from selling the future airdrop — plus the actual yield.
Cega, Pendle and Ether.fi unveiled a new spin on the YT token Tuesday with Cega’s latest vault, "Pendle Ether.fi YT Tiger."
Users can now restake YT-eETH on Ether.fi for a 17.80% APY — paid in YT-eETH — juicing the points exposure even further through a special 107x+ Cega multiplier and further boosts available through Ether.fi’s Perks Passport.
The "Pendle Ether.fi YT Tiger" employs a Dual Currency Swap (DCS) strategy that allows users to earn yield regardless of market direction. The available YT tokens for deposit at launch are the Sept. 24 and Dec. 24 expiries.
The Polygon Protocol Governance Call #22 addressed a few critical network upgrades and changes, of which some have been discussed extensively in prior meetings. For the Bor client v1.3.4, the minimum gas price is being reduced from 30 to 25 gwei to prevent filtering out legitimate transactions, with plans to eventually remove the floor entirely.
Build on Bitcoin (BOB) marries Bitcoin security with the OP stack to create an EVM environment for Bitcoin applications.
Franklin Templeton has the lowest intended ETH fund fee so far, though a similar advantage did not help it win the race for bitcoin ETF assets.
The council, helmed by 10 firms, aims to set standards for security across the blockchain industry.
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The insights, views and outlooks presented in the report are not to be taken as financial advice. Blockworks Research analysts are not registered broker/dealers or financial advisors. Blockworks Research analysts may hold assets mentioned in this report, further outlined in the Firm’s Financial Disclosures.
