Bitcoin has bumped its head, and Ethereum continues leading the market, giving altcoins real room to run. The biggest behind-the-scenes event currently ongoing is the SEC vs Coinbase case taking place in New York. A win for Coinbase would be massive for the industry and a huge blow to Genlser’s regulation-by-enforcement approach. Brian is fighting the good fight, and Fink is shilling asset tokenization as the next evolution of markets. Great time to be holding Spot bags.
Nothing is sacred in crypto, and investors must learn how to pivot- imagine if in 2021 somebody said that NFT volume on Bitcoin would outpace NFT volume on Ethereum. Bitcoin’s monthly fees have eclipsed Ethereum’s due to the BRC-20 craze. Ordinals are the first step in a broader innovation wave that will help solve Bitcoin’s long-term security problem. The question has always been how Bitcoin will pay miners as issuance drops over time. Are Ordinals and DeFi built on top of the Bitcoin network the answer?
Lido continues crushing it, and expect to see EigenLayer/ another restaking protocol creeping into the top fee generators in the coming months. Solana remains impressive as ever, and the bulk of on-chain activity comes from DEXs/ perps, showing investors have an appetite for speculation. DeFi TVL looks healthy, and the wealth creation from $ETH’s appreciation is breathing new life into on-chain activity on layer twos.
Welcome to the Rainforest Stack. A guide for the intrepid into the dynamic world of DeFi yield.
Constituted of four distinct layers: undergrowth, understory, canopy, and the emergent layer. Each layer boasts a different level of risk broadly categorized in line with the Lindy effect- the longer something has survived, the more likely its continued existence becomes.
An impact with oversized ramifications in the crypto space where hundreds of new protocols live and die each quarter.
More details about the Layers of the Rainforest stack here.
Observations
$GLP continues to provide a straightforward and relatively profitable yield opportunity for investors with a mild risk tolerance. A great basket of assets to hold alongside trading fees is a hard value proposition to pass up on.
Liquid staking tokens remain the bread and butter yield on DeFi and, more excitingly, will be the integration of liquid restaking tokens. Picking a LRT now is a good idea for anybody not already earning restaking points. Layering yield on yield, of course, comes with risk. However, risk-taking behavior pays dividends in risk-on-market conditions.
Notable Mentions
Pool: ETH on EtherFi. APY: 3.46%. TVL: $239m. Chain: Ethereum
Pool: USDT on Aave V3. APY: 17.28%. TVL: $7.69m. Chain: Optimism
EtherFi allows users to earn EigenLayer restaking points and EtherFi loyalty points, making it a double whammy for potential future airdrops.
Stablecoin supply rates remain great for suppliers and pretty brutal for borrowers. But these prices are obviously worth paying and expect these rates to continue creeping up as more and more investors seek to increase their exposure. A word of advice. Taking large risks is always better to do early in the cycle than late in the cycle.
Observations
All volatility on Solana means fees for liquidity providers, and three-digit APY for a bluechip stablecoin pairing is nothing to sniff at.
Spiking supply rates on Venus for $BNB. Given the very few single-sided yield opportunities for $BNB, these spikes are great for suppliers.
Notable Mentions
Pool: TIA on Keplr. APY: 15.83%. TVL: $24.5m. Chain: Celestia
The Rainforest Stack is still beating the modular money drum. Anybody who staked $TIA at our first recommendation has already qualified for four airdrops. The most recent snapshot came from AltLayer, and $TIA stakers continue eating. Two notable points. Huge unlocks in October this year, and the number of unique wallets has tripled in the last two weeks- an influx of new holders and people splitting their bags to qualify for more airdrops.
Pool: Turbo eETH on Sommelier. APY: 11.88%. TVL: $2.05m. Chain: Ethereum
Sommelier has launched some of the most competitive yield products for Ethereum. The Turbo eETH vault is currently being boosted with $SOMM tokens and EtherFi loyalty points, making it a great way to kill two birds with one stone.
Observations
TraderJoe remains the undisputed king for liquidity providers. Week after week, it features in the Rainforest Stack. Anybody skilled in liquidity provision is making steady and serious gains using its Liquidity Book Model.
Beefy has a slew of new vaults paying out excellent APYs, but all incoming liquidity will obviously dilute the current yield. New vaults for TraderJoe’s auto pool tokens are absolutely excellent.
Notable Mentions
Pool: mETH on Mantle. APY: 7.2% TVL: N/A Chain: Mantle
Mantle has raised the cap of its liquid staking token $mETH from 250,000 to 333,000, meaning anybody with an LST can double their yield by swapping.
Pool: mETH Vault on Circuit. APY: 18.69% TVL: $1.16m Chain: Mantle
Users can then take their $mETH tokens and deploy them in Circuit’s Vault. The Vault currently has a boosted APY. Circuit, the leading yield protocol on Mantle, still has no token. Quality for future airdrops. One thing to be aware of is that Circuit has withdrawal fees for several of its vaults (0.1%) which are distributed within the vault. Do the math before depositing.
Observations
Despite Mantle’s slow start as an ecosystem, the yields are cooking, and Circuit’s vault products are a great way to get in on the action. Liquidity is still low, meaning the opportunity is high.
Steer Finance is a new auto-balancing liquidity protocol that ostensibly allows everyone to enjoy the benefits of concentrated liquidity without any rebalancing headaches. Do operate with caution when using any new protocol.
Notable Mentions
Pool: INJ-hINJ on Hydro. APY: 415.1%. TVL: $361m. Chain: Injective
Pool: INJ-HDRO on Hydro. APY: 932.08%. TVL: $160m. Chain: Injective
Hydro Protocol airdrop confirmed for all $INJ stakers, and with mainnet release coming on the 31st, investors have several weeks to interact and qualify for the airdrop. There is a huge number of $INJ owners and not much to do with it currently. Any trading activity will rack up serious volume, and LPs can make a lucrative profit supplying in these still relatively niche areas.
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Disclaimer: This article, including insights on the “Rainforest Stack” and other DeFi strategies, is for informational purposes only and should not be considered as financial advice, investment recommendations, or an endorsement of any particular investment or strategy. The cryptocurrency and DeFi markets are highly volatile and unpredictable. Past performance is not indicative of future results. One Click Crypto makes no representations or warranties regarding the accuracy, completeness, or timeliness of the information provided. Readers should conduct their own research and consult with independent financial advisors before making any investment decisions. By using this information, you agree that One Click Crypto is not liable for any losses or damages arising from your investment choices.
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