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Liquity Newsletter — July 2021

Liquity Newsletter — July 2021

Kolten Bergeron

August 2, 2021

Hey everyone! Welcome to our monthly newsletter where we share updates regarding Liquity and our ecosystem on a regular cadence.

If you haven’t already, be sure to follow us on Twitter and join the community Discord to stay up to date.

If you’d like these sent directly to your inbox, sign up for the mailing list here.

Protocol Overview

LUSD Utilization — Source: Dune Analytics

July was a great month for LUSD growth beyond the Stability Pool. Stability Pool dominance for LUSD utilization started the month at 89.3% and has since shrunk to 76.4% at time of writing. This means that some users have not only left the Stability Pool, but are finding other places to use their LUSD. A popular spot is the LUSD 3pool on Curve, which holds $100M in LUSD.

ETH Price (30D) — Source: Coingecko

As a protocol for obtaining leverage against ETH, Liquity’s usage trends will often follow the price of ETH, which finally started to rally late last month. We saw a drop from $2,400 to $1,800 that led to a decrease in borrow demand and more users paying off their debt, but we also saw that trend reversed as ETH started to climb in the last two weeks:

LUSD Mint / Burn (12D) — Source: Dune Analytics

Since users are becoming more comfortable with market conditions, they aren’t paying off debt as aggressively as we transition to August.

Liquity Protocol Revenue — Source: Dune Analytics

As mentioned in Weekly Wrap Up #13, this uptick in borrow demand also pushed Liquity’s total revenue past $13.1M. Not bad for its fourth month live!

Integration Updates

  • Upcoming: Tomorrow, August 3, at 6pm UTC we will be hosting a live discussion with the B.Protocol team regarding their upcoming Liquity integration and V2 release. Set a reminder here.
  • Rewards for the Saddle D4 Pool are live. Users can now stake their D4 Pool LP tokens to earn LQTY, FXS, ALCX, and TRIBE all at once. Add liquidity here and stake here.
  • Instadapp governance passed the proposal to integrate Liquity. After the technical side of the integration is complete, Instadapp users will be able to borrow LUSD, deposit to the Stability Pool, and much more. See the results here.
  • The crvLUSD Yearn Vault is part of PowerIndex’s Yearn Lazy Ape Index. The Yearn Lazy Ape Index is a diversified cashflow-generating portfolio of Yearn Vaults LP tokens with dynamically adjusted weights according to TVL. Use it here.
  • crvLUSD has been included in BasketDAO’s Money Market Index (BMI). BMI is an index of stablecoin yield farms that’s automatically rebalanced monthly to ensure that yields are high and risk is diversified. Try it here.
  • Harvest Finance launched their LQTY staking vault. The vault automatically harvests earned LUSD and ETH rewards and uses them to acquire and stake more LQTY. The Harvest team is in the process of including their own iFARM rewards. Learn more.

Content Updates

  • This month I published two weekly recaps that covered updates from the Liquity ecosystem. Read Weekly Recap #12 here and Weekly Recap #13 here.
  • Our Community Manager, Derrick, posted a tutorial covering how to use your crvLUSD on Element Finance — a protocol for earning fixed rate yield. Read it here.
  • Derrick also posted a tutorial covering how to earn rewards with the Saddle D4 Pool. He walks through liquidity provision and staking via the Frax interface. Read it here.
  • Oh yeah, Derrick also published a tutorial covering how to use Liquity on DeFi Saver — a dashboard for creating and managing your DeFi positions. Read it here.
  • Okay, last one from Derrick. He published the second installment of the Comparison Series. This time he took a look at the key similarities and differences between Liquity and Reflexer. It covers governance, peg stability mechanisms, collateral ratios, and more. Read it here.
  • If you were in Paris for EthCC, we hope you had a chance to attend the Fetedao event we sponsored. The event featured two DeFi panels that included speakers such as Robert Lauko, Stani Kulechov, Ashleigh Schap, Mariano Conti, and a few others. Watch a highlight video here.

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