🟣 On the Eve of the ETH ETF

With another ETF ready for launch tomorrow, crypto prepares for its second foray into mainstream TradFi.

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Luke Leasure & Donovan Choy
July 22, 2024

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Welcome back to 0xResearch. Here's what we’ve got for you today:

  • Aerodrome continues to dominate Uniswap on Base

  • The ETH ETF preps for launch

  • Maple Finance continues its newest growth strategy

Markets reacted to the upside over the weekend, seemingly in response to Biden’s withdrawal from the presidential race.

All eyes are now on the spot ether ETF launch in less than 24 hours.

Aerodrome in Control

Aerodrome emerges as the dominant DEX in the Base ecosystem, winning across key metrics like volume, fees, and TVL. With over $600M in TVL, this is over twice that of the runner-up, Uniswap, with $285M in deposits. In recent months, Aerodrome has settled more in daily volume than Uniswap, as well. Aerodrome recently shipped its Slipstream product to bring concentrated liquidity automated market-maker (clAMM) pools to their DEX. clAMMs have proven their resilience, offering better execution for traders and improved returns for liquidity providers.

ETH ETF to go Live

T-minus 24 hours before trading begins on the Ethereum ETF. All of the 8 issuers filing for the ETH ETF have announced their fees, with the majority settling between .19% and .25%, with the one exception of Grayscale. Grayscale will offer 2 unique vehicles for Ethereum exposure; the Grayscale Ethereum Trust (ticker: ETHE) and the mini trust (ticker: ETH). While ETHE will maintain a fee of 2.5%, the mini trust will offer a 0% fee for the first 6 months of trading, up to $2B in AUM. Following this preliminary window, the mini trust will charge a .15% fee, undercutting all of the competitors currently advertised rates. Interestingly, the mini trust will be seeded with 10% of ETHE’s current AUM, and ETHE investors will receive a proportional distribution of the mini product at creation. Grayscale is likely moving some of its client’s capital into this lower fee product in an attempt to dampen the exodus of funds that was observed with GBTC conversion to an ETF. As trading begins tomorrow, we’ll get our first glimpse into how well this strategy may work for them.

Maple Growth

Maple Finance, a lending protocol with offchain infrastructure and DeFi composability, shows green shoots and notable growth. For the past 3 months in a row, Maple has incrementally posted record highs in monthly protocol revenue, as deposits in the protocol continue to push 52-week highs. Maple is launching a new lending product, Syrup, letting users lend USDC to approved institutional borrowers. Syrup advertises fixed rewards with a floor of 15%. Additionally, Syrup lenders can farm “drip” rewards, which will ultimately convert to a new SYRUP token in Q4 2024. Since launch, Maple has originated over $4B in loans.

— Luke Leasure (X: @0xMether )

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USDC vs USDT:

Historically, CEXs tend to be the go-to venue for most crypto investors, due to liquidity and a familiar UX. DEX liquidity pales in comparison, but offers the key advantage of permissionlessness, making it the de-facto launchpad for crypto-natives dabbling in all manners of altcoin risk trading.

The metric of monthly DEX to CEX spot trading volumes is hitting its lifetime all-time-high at ~15% this month. This suggests that DeFi is coming back in full swing as investors come onchain to yield farm or trade altcoins that are not available on CEXs.

— Donovan Choy (X: @donovanchoy | Farcaster: @donovan)

ZKPs enable efficient off-chain transaction processing and validation, resulting in increased throughput and reduced fees. Solana's ZK Compression leverages ZKPs to minimize onchain storage costs, while Sui's zkLogin streamlines user onboarding by replacing complex key management with familiar OAuth credentials.

By offering highly granular real estate price feeds and creating new markets, Parcl aims to attract a diverse range of participants and provide new investment and hedging opportunities in the real estate sector, potentially expanding overall RE market activity.

Geth may curtail support if EOF goes AWOL.

Nirvana Labs said its revenue has increased 650% this year, and has raised $5.7M across rounds.

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.