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This Week in DeFi – May 15th

May 18, 2020

Things are looking up for DeFi and crypto at large, and we’re excited to watch it unfold over the next few years. With that – let’s dive into lending rates!
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The week kicked off with ErisX launching the first US-regulated futures on ETH. While ErisX futures contracts aren’t the most widely traded, the key takeaway is that the CFTC will allow Ether-based futures contracts to launch legally in the US.

Importantly, these are physically-settled futures contracts, meaning that the contracts require the digital delivery of ETH when the contracts expire – rather than the cash equivalent. The introduction of CFTC regulated futures is a vital step in the maturation of Ethereum and massively increases the accessibility of Ether to institutional investors. We can expect Bakkt and CME – two other financial institutions that support crypto futures – to launch their Ether-based derivatives products in the coming future.

On the other side of the spectrum, we saw an entirely new crypto-native offering from Grammy award-winning recording artist, RAC. The artists dropped $TAPE – a limited edition cassette tape of his new album – on Zora. The drop was a massive success as it’s currently the most profitable LE drop we’ve seen on Uniswap to date. In less than 24 hours, $TAPE surged from ~$20 to over $800. While this is a great initiative, there are some things that could be refined to make these offerings more attractive and accessible for dedicated fans. You can read more about the offering and some of the issues here.

The last thing we’ll touch on is probably the most bullish thing we can discuss. Ethereum and DeFi are going mainstream.

This week alone we saw Reddit launch the initial testing for Community Points – tailored ERC20 tokens for Reddit communities – to two major subreddits: /r/cryptocurrency and /r/fortniteBR. These two communities combine for over well over 2M users who will be introduced to the Ethereum ecosystem. In addition, we saw Visa – the payment giant – looking to file a patent for a “fiat-backed digital currency”. The patent mentions Ethereum over 10 times, however, it does not explicitly state it will leverage the public blockchain for its patent.

That said, the fact that both Reddit and Visa (as well as many other corporations) are exploring Ethereum implementations into their multi-billion dollar companies is hard to ignore. Things are looking up for DeFi and crypto at large, and we’re excited to watch it unfold over the next few years.

Defi Beeders

DeFi – Decentralized Finance

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