Arrakis's Growth, Wolf Game Returns, DeFi in Volatility

Chart of The Day: Liquidity Protocol Amasses ~$800M TVL

• Arrakis Finance, previously G-UNI from Gelato, is a Uni-V3 Automated Liquidity Management protocol that aims to deploy active Uni-V3 strategies to manage liquidity and maximize yield.
• Arrakis Finance has amassed ~$800M TVL even as DeFi TVL has suffered over the past month. To put it in perspective, Arrakis has grown by 68%, while TVL across crypto has dipped by 48%.
• This is possible as Arrakis’s main vaults consist of mostly stablecoin pairings unaffected by market movements. Though it is still surprising given that there is no liquidity mining on Arrakis yet.
• Arrakis Finance’s token, $SPICE is currently being distributed to the Gelato ($GEL) community if they decide to lock their $GEL for 3 months. 3% of $Spice supply will be distributed to users who locked $GEL.
• $SPICE will be the veToken of Arrakis, which will allow vault depositors to boost $SPICE yields, earn protocol fees, and direct $SPICE emissions.
• Through Oasis.app, users and degen farmers can gain easy access to 50x leverage on the Gelato DAI-USDC pool because it is supported as a MakerDAO collateral type.

We’re In Goblintown & The Return Of Wolf Game

[Excerpt from a Delphi Insights Report]

• If you were dabbling in NFTs late last year, you would probably remember Wolf Game. In November 2021, it launched to great fanfare, run by a mysterious individual known only as “The Shepherd” and was shilled loudly by NFT influencers such as Beanie. In the first version of the game, there were 2 main types of NFTs:
  • Sheep can be staked to earn $WOOL tokens, which could be used to breed next-generation sheep
  • Wolves would steal $WOOL and new sheep from unlucky players.
• Some say that Wolf Game single-handedly sparked off a meta-narrative around on-chain Play-to-Earn games, leading to tens of forks launching on every chain. It was a brutal battlefield — none of the forks have survived today, except for the original Wolf Game. While the first version of the game is no longer running, there are 2 mini-games in progress while the full game is under development. After 7 months of effort, the time is near — the full game is expected to launch in June 2022.

• Alpha Game (Mini-game 1): In this team-based competition that commenced in January 2022, players stake their sheep & wolves to be part of an Alpha Wolf pack and earn part of a prize pool of $WOOL. Alpha Wolf packs can attack other packs or fortify against attacks. 14 teams are competing; the current leader @RealCryptoCoach has 287 Wolves & 1,720 sheep in his pack. Gary Vee and Gmoney are a few of the influencers who have been running an Alpha Wolf pack. This is a passive game for most players, with the main decision being choosing which Alpha Wolf pack to stake with.
• Cave Game (Mini-game 2): This is an interactive real-time game similar to old-school dungeon explorers. Sheep and wolves can hunt in a cave, competing with their pack for the same loot. Each sheep/wolf has a limited amount of energy that replenishes over time. Gems, merch, and other NFTs found in the cave can be claimed on-chain as rewards. Gems can be used to create rare Farmer types.

Cave Game

• Both of these mini-games are just appetizers, with the main course yet to be served. The full game has been developed in stealth, and the exact mechanics have not been revealed yet. Based on what I’ve seen, I anticipate that the game will:
• • Involve DeFi-type game mechanics such as staking, yield farming & breeding.
  • Have interesting game theory elements that draw players in to pit their skills against one another.
  • Add utility for all of the NFTs in the current Wolf Game ecosystem. Not just sheep and wolves but also farmers & lands which have not been utilized in the mini-games. We could see new NFTs being introduced as well.
  • Use $WOOL as the primary in-game currency, generating demand for the token.
• For more, Delphi members can see the full NFT Insights here.

DeFiant In The Face of Volatility

[Excerpt from a Delphi Pro Report]

• The recent UST depeg and LUNA’s collapse were devastating; the event sent shock waves across the industry. Secondary effects rippled across other blockchains, severely affecting Kava, Lido, and other protocols which had exposure to Terra and/or UST. Decentralized and centralized exchanges alike were stress-tested to their extremes. But it’s during these periods of extreme volatility the robustness and resilience of DEXs became even more salient. 

• Although Uniswap holds the lion’s share of the DEX market, the flight to other stables during last week’s UST depeg caused a significant spike in trading volume for Curve. Curve’s StableSwap invariant, specifically designed to facilitate efficient stablecoin trading and deep liquidity, clearly boosted the protocol’s capital utilization during this period.  

• Decentralized exchange daily volumes reached the second highest 365 day daily peak on May 12th, only to be eclipsed by May 19, 2021.
• Liquidity aggregator volume spiked to a daily total peak of $3.58B during this period, lead by 1inch with $2.56B. 
• Net added liquidity for Uniswap and Sushiswap recorded highest single day YTD outflows on May 11th, with $305M removed.
• Whilst almost all decentralized exchanges remained fully operational, virtual AMM Drift Protocol halted operations amidst extreme market volatility on May 11. The decision was made shortly after the discovery of a smart contract bug that inaccurately calculated P&L, allowing users to withdraw more assets than they were entitled to from the collateral vault. A settlement methodology and statement was released earlier this week, Drift Protocol will oversee the distribution of the insurance fund in its entirety and a redemption plan has been put in place. 
• For more, Delphi members can see the full Delphi Pro Report here.

Notable Tweets

YGG Responds to Merit Circle Proposal

In light of a proposed community vote at
@meritcircle_io
, YGG has issued the following statement as a summary of the issue and our response.

#WeAreYGG

—Yield Guild Games (@YieldGuild) May 25, 2022

Crypto Unicorns RBW Primer

Hey, Unicorn fam! 🦄

We’ve written up an RBW Tokenomics Primer on Medium! Give it a read here:
🔗

https://t.co/7h2toj0j1G

— Crypto Unicorns (@crypto_unicorns) May 26, 2022

ETH’s 7-block reorg? What Happened?

My attempt to break down what happened and the probability of how it happened 🧵

— terence.eth (@terencechain) May 26, 2022