Load the Bitfinex Shorts, dApp Revenues, ENS Grows

JUL 08, 2021 • 3 Min Read

Ashwath Balakrishnan + 1 other

Disclosure: Members of our team may own positions in assets mentioned in this report. This statement is intended to disclose any conflict of interest and should not be misconstrued as a recommendation to purchase any token. This content is for informational purposes only and you should not make decisions based solely on it. This is not investment advice.

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Market Update

BTC is down 3.5% today as it makes way towards the range low. After a fun few days, alt season may have been short-lived; AXS has been hit the worst, down 22% in the last 24 hours. In today’s edition, we cover the re-emergence of Bitfinex shorts and why June wasn’t such a bad month after all.

Bitfinex Shorts Back At It

  • After a massive round of shorts closed in the last week of June, shorts are once again going ham on Bitfinex. Over 5k BTC worth of shorts were opened in just the last few hours.
  • The last time this happened, shorts started closing their positions soon after, as the price rebounded. But the build-up of shorts happened before the bottom. This time around, BTC isn’t looking too hot.
  • When shorts close their positions, they do so by going long to offset their short exposure. So if and when shorts start closing their positions, we can expect the price to squeeze higher.

dApp Revenue Over the Last Month

  • Once again, Axie takes the cake as the top revenue-generating dApp, followed by PancakeSwap and MakerDAO.
  • Maker’s growth, in particular, is quite surprising given the reduced demand for leverage. Revenue on Maker has fallen month-on-month, but it continues to shine as the top revenue-generating DeFi protocol.
  • PancakeSwap, Metamask, and Sushiswap comprise the remaining of the top 5, and all earn their revenue via swap fees.

OlympusDAO Treasury Doubled in June

  • OlympusDAO is a lesser-known DeFi protocol (with a thriving community) aiming to build a policy-controlled currency. The DAO’s treasury grew significant over June, and feeds off the concept of “protocol owned liquidity.”
  • OlympusDAO’s treasury now controls a significant percentage of total liquidity in its Sushiswap pool, which means it’s now less reliant on OHM (the OlympusDAO token) emissions to incentivize liquidity and keep it sticky. Further, the protocol is also less reliant on LP bond sales to generate revenue.
  • This allows for pure DAI/FRAX sales to commence, increasing protocol RFV (risk-free value) instead of market value (which is dependent on OHM price).
  • Higher RFV means users can take more risks with bonds, making bonds easier to sell to generate protocol revenue.

ENS Sees Record Growth in June

  • As the price of ETH fell over June, people took the opportunity to snag cheap ENS domains, sending monthly registrations over 2x past their previous all-time high in Nov. 2019. Maybe June wasn’t so bad after all.
  • ENS brings simplicity to Ethereum payments and address visibility. With more dApps integrating it, ENS is set to become a core piece of Ethereum infrastructure.

Notable Tweets

Axie land sells for over $600,000.

Benjamin Simon of Mechanism Capital explain dispute resolution on Optimistic Rollups.

Santander follows Barclays, banning customers from sending funds to Binance.

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Ashwath Balakrishnan + 1 other