DeFi users deposit $100 million in stablecoins into Ethereum’s latest yield farm 🚨 This article is 4 years old...
DeFi users deposit $100 million in stablecoins into Ethereum’s latest yield farm
2 min read
Updated: Oct. 19, 2020 at 10:02 pm UTC
It appears that even after a strong retracement, the decentralized finance (DeFi) space is far from dead. This much was made clear when the Ethereum-based Barnbridge project launched its liquidity mining program on Sunday evening.
The launch garnered much attention in the DeFi space as the project recently received investments from some top venture funds and innovators within the space.
Barnbridge launched with over $100 million in total value locked
On Sunday evening, the first liquidity mining pool of Barnbridge launched.
Barnbridge is a decentralized tokenized risk protocol that is attempting to use Ethereum-based derivatives and bonds to further financialize the cryptocurrency space. Barnbridge will be governed by a native token called BOND.
The mining pool that consisted of deposits of USD Coin, DAI, and sUSD began to accumulate millions of dollars before its launch. Now, just under 20 hours after the pool launched, there is $175 million locked in the contract.
This makes Barnbridge one of the largest liquidity mining schemes in Ethereum DeFi history.
What’s interesting about this is that BOND will not begin trading for a week as the coin will not be launched until the first distribution is finished next Sunday evening.
This means that users are throwing over $175 million into the pool without any knowledge of what the annualized yield of this yield farming opportunity will be. But this writer estimates it to be around three to seven percent, depending on how high a price BOND begins trading at early next week.
Next Sunday evening will also mark the launch of Barnbridge’s second pool, a USDC-BOND Uniswap liquidity provider pool.
What is Barnbridge?
Barnbridge is a tokenized risk protocol that has been funded by top investors in the space. After a $1 million seed round closed in September, the startup counts Fourth Revolution Capital, ParaFi, Synthetix founder Kain Warwick, and Aave founder Stani Kulechov as investors.
The “explain it like I’m five” explanation is that Barnbridge is a protocol that allows DeFi users to hedge risks in their investments and yield farms. Common risks in all markets, crypto include, are volatility in the market price of an asset and volatility in interest rates provided by different creditors.
Barnbridge is a product that should help draw in larger institutional players that are seeking to build a risk-adjusted allocation to crypto-assets and DeFi yield farms.
What’s interesting is that Barnbridge will be “platform and asset agnostic,” meaning that it may be able to serve DeFi users on Polkadot, for instance, and may even provide tokenized risk opportunities for synthetic “real world” assets like equities and real estate.
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USD Coin
$1.00001
USD Coin (USDC) is a stablecoin fully backed by the US dollar and developed by the CENTRE consortium.
sUSD
$1.00271
sUSD (formerly nUSD) is the stablecoin launched by Synthetix Network (formerly Havven).
Dai
$1.00001
Dai (DAI) is a cryptocurrency token and operates on the Ethereum platform.
Uniswap
$9.83607
Since its inception, the Uniswap Protocol (“Uniswap”) has served as a trustless and highly decentralized financial infrastructure.
Synthetix
$1.89907
Synthetix, formerly Havven, is a cryptoasset-backed network that enables the creation of on-chain synthetic assets.