This Ethereum DeFi protocol gained $1 billion in deposits in the 12 hours after its launch 🚨 This article is 4 years old...
This Ethereum DeFi protocol gained $1 billion in deposits in the 12 hours after its launch
2 min read
Updated: Jan. 1, 2021 at 1:18 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
It appears that the “ape” mentality that captured Ethereum investors in the summer has returned.
A protocol that launched yesterday evening garnered $1 billion worth of deposits in the 12 hours after its launch, making it the fastest-growing “money game” thus far. For some context, Yam Finance, widely regarded as the most well-known yield farming experiment, garnered around $400 million worth of deposits in the two days after its launch.
Mithril Cash launch garners immense interest from yield farmers
As CryptoSlate has extensively covered over the past few weeks, one of the biggest trends in decentralized finance over the past weeks is algorithmic stablecoins.
Where coins like USDC are backed by dollar reserves, there has been a spawn of new projects looking to accomplish the same stability without collateral backing each coin. This is often done through a system of coupons and secondary coins called “bonds,” which entitle holders to inflation/rebasing when the price of the coin is above $1.
One project doing this is known as Basis Cash (BAC). It has seen much interest from investors over its month-long life span, with Three Arrows Capital and other funds getting involved in trading the coin.
With so much hype around projects like Basis Cash, some have attempted to fork it.
The team behind Mithril and the DeFi protocol Cream did that yesterday when they launched Mithril Cash.
While few on Twitter would mention the name of the project when it launched, the contracts gained over $100 million worth of deposits in five minutes, $400 million in two hours, then over $1 billion in under 12 hours.
This comes in spite of the fact that Mithril Cash’s contracts are unaudited, similar to Yam in the summer.
Hi community, thank you for your support. @mithcash has just achieved $1b TVL 8.5 hours after launch. This is #FairLaunch. No pre-sale, no pre-mine, no dev pool, no VCs. Let's go! $MIC $MIS $MIB pic.twitter.com/PIJDGpdkD9
— MITHCASH (@mithcash) December 30, 2020
The reason why there was so much interest in the launch is that users could deposit stablecoins, other algo stablecoins, and DeFi coins such as Sushiswap’s SUSHI, Yearn.finance’s YFI, AAVE, Chainlink, and many more to earn free Mithril Cash.
The yields offered by this farm are in the hundreds of percent annualized, making them extremely attractive for investors with stablecoins or DeFi coins lying around in their wallets.
Second-order effects of the launch
This launch has had a strong effect on many parts of the DeFi ecosystem. Here’s a brief list of the second-order effects:
- Curve’s volumes have risen as investors look to swap their stablecoins for the highest-yield stablecoins.
- Yields offered on Synthetix USD (sUSD) deposits into Aave have shot to 105 percent as the price of sUSD has risen to $1.06.
- Yields offered by Cream on governance tokens have shot up to hundreds of percent per annum.
- DeFi coins are shooting higher, with AAVE, COMP, SUSHI, and other top coins posting strong gains for the first time in many weeks.
Mithril Cash now has over $400 million in total value locked just three hours after its launch.
This includes over $200 million worth of stables and dozens of millions in YFI, CRV, and more.
Let's take a look at the second-order effects of the launch of this Basis Cash fork. ?
— Nick Chong (@n2ckchong) December 30, 2020
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Aave is an open source and non-custodial protocol enabling the creation of money markets.
Chainlink
$13.2856
Chainlink is a decentralized oracle network that connects smart contracts on the blockchain to real-world data.
SushiSwap
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SushiSwap is an automated market-making (AMM) decentralized exchange (DEX) currently on the Ethereum blockchain.
YAM V3
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Yam is an experimental protocol building upon the most exciting innovations in programmable money and governance.
Basis Cash
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Basis Cash (BAC) is a stablecoin, which the protocol aims to keep value-pegged to 1 US Dollar.
MITH Cash
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Mithril Cash is the new algorithmic stablecoin forged from Mithril, a valuable silver-like metal that is not only stronger but also lighter than steel, just as the community that we are building.