Last Week in DeFi: PancakeSwap V2, Balancer V2, Uniswap V3

This week saw several platforms launch a new iteration of their protocol, with improvements addressing high gas costs and fee models. Price-wise, DeFi tokens performed variably, with PancakeSwap’s CAKE leading the way and BadgerDAO’s BADGER at the bottom of the list.

PancakeSwap announced, earlier this week, it will be migrating to its V2 iteration, and will allow its users to choose one of four different fee structures. The community eventually went with the “Big Burn” model, which received 66.85% of the votes, that would support a 0.25% trading fee and the highest CAKE token burn rate. All PancakeSwap farms have already been migrated to V2.

On Tuesday, Balancer completed one of its biggest upgrades to day, and officially launched its V2 smart contracts on the Ethereum mainnet. Currently only the smart contracts have been deployed — with the launch of the V2 UI being scheduled for 28 April — which will give the platform’s partners and developers time to build and integrate before consumers start using V2 actively. The project also announced a record breaking bug bounty — the top prize being 1,000 ETH or $2 million (whichever is higher) — for those that are able to spot critical bugs that allow attackers to drain the V2 vaults.

Uniswap has scheduled the launch of its V3 iteration for 5 May, when a number of new features, including concentrated liquidity and a new fee tiers system, will go live. Though still not live on the mainnet, developers can already test the V3 core and periphery contracts on the Ropsten, Rinkeby, Kovan, and Goerli testnets. The platform has also launched a bug bounty with rewards of up to $500,000 for those that discover high severity bugs in the V3 contracts. The decentralized exchange also passed the $10 billion weekly trading volume for the first time.

Alpha Homora, on the other hand, announced the launch of its V2 iteration for the second time. While it was officially launched in late January, hackers were quick to find a crucial exploit in the contracts, forcing the team behind the project to fully pause borrowing on the platform. Once launched, V2 will provide yield farmers with more leveraged pools, assets available to borrow, and will enable the use of LP tokens as collateral. This week the platform also announced it has added support for BNB/DOT and BNB/INJ leveraged yield farming pools on PancakeSwap.

At the start of the week, Aave released a risk assessment of its V1 and V2 protocols, in which Gauntlet analyzed the borrow parameters, liquidation incentives, and the slashing impact on the safety module. The platform also launched a vote to add liquidity incentives for Aave V2, which has already reached a quorum, with the majority of users agreeing to the proposition.

MakerDAO saw its proposal to upgrade its liquidations system pass earlier this week. One of the functions of the new upgrade is to help DAI maintain its soft peg to the U.S. dollar, by ensuring that all tokens are sufficiently backed by collateral. The new system will provide greater security, predictability, and decentralization, facilitating wider participation by the Maker community. The platform has also initiated a vote, which if passed will increase the system surplus buffer from 30 million to 60 million, and add YFI-A to the Liquidations 2.0 framework.

On Thursday, SushiSwap announced it was integrating the Chainlink Price Feeds with its Ethereum and Binance Smart Chain versions. The need to integrate with the popular oracle solution was to ensure that the Kashi markets — an innovative lending and margin trading protocol — were secure and robust. The integration now allows traders to create custom Kashi markets using Chainlink’s large collection of pre-built price feeds.

Vesper decided to partner with Nexus Mutual in order to further ensure the security of investor funds. Nexus Mutual allows token holders to stake their NXM token on accepted DeFi protocols, sharing the revenue for subscriptions and shouldering the burden if funds are ever lost.

BadgerDAO decided to launch Rebase Mining — an action oriented way for users to earn DIGG rewards instead of just providing liquidity — through a partnership with UMA. The platform also announced a new DIGG Options airdrop to its users.

On Monday, Curve crossed the $1 billion daily volume mark for the first time, which brought $400,000 in fees for the veCRV token holders in a single day. The DeFi platform also announced a new pool on Polygon, with its liquidity being deposited through Aave, which will allow users to swap between DAI, USDC and USDT while earning trading fees and MATIC tokens.

Price Changes

The largest price increase we saw this week was that of the CAKE token, which began the week with a price of around $22 per token, but by the end of it had jumped by almost 28%, and traded for $30.56 at time of writing. Similarly, MakerDAO’s MKR token experienced an almost 20% increase in price in the past week, with its price hovering around $3,253 at the start of the week, and ending at almost $4,000. In the span of two days — between 21 and 23 April — MKR was able to skyrocket from $3,500 to more than $4,800, and then fall down to less than $3,400.

Other tokens that closed the week on a positive note were Compound’s COMP and Uniswap’s UNI. Compound began the week at around $490 per token, and had a price increase of almost 15% on Sunday, when it traded at around the $570 mark. While less impressive, Uniswap’s UNI had a price increase of almost 6%, beginning the week at around $32 and ending it at $34.

Other tokens were not so lucky however. Most projects — including Aave, Balancer, Bancor and Venus — saw their tokens perform fairly well during the week, with some even having a notable price increase at some point. This all changed on Thursday, when the price of Bitcoin suddenly went from around $55,000 to less than $48,000 in less than 24 hours. All the DeFi projects mentioned above ended the week with their tokens falling by around 20% in price.

Curve, SushiSwap, and Badger had it even worse. While SUSHI and CRV experienced around 30% drop in prices in one week, BADGER went down by almost 44%. Unlike other tokens, BADGER has not been following the price of Bitcoin so closely, and has been in decline the entire week. It began trading on Monday at around $30, and slowly fell down to almost $24 in seven days.