DeFi & L1L2 (Week 31, 03/08/2022 – 09/08/2022)

U.S. Treasury Department sanctions Tornado Cash. Thousands of Solana hot wallets compromised after private keys were exploited in Slope mobile wallet. Uniswap proposes to form a Uniswap Foundation.

Weekly DeFi Index

This week’s price, volume, and volatility indices were negative at -1.17%, -38.88%, and -52.65%, respectively.

DeFi Index Tokens

News Highlight

• The U.S. Treasury Department sanctioned Tornado Cash, an Ethereum coin mixer. Tornado Cash was accused of being used to launder more than US$7 billion worth of virtual currency since its creation in 2019. In the announcement, the regulatory body blacklists the Tornado Cash website and a list of Ethereum addresses, banning American citizens from using the tool or transacting with these addresses. 
• Over 8,000 Solana hot wallets, including Phantom, Slope, and TrustWallet, were compromised last Wednesday and nearly $4.5 million worth of tokens have been drained. Solana developers said they have identified the root cause of the hack: compromised private keys “created, imported, or used in Slope mobile wallet applications”.
• Uniswap raised a proposal to form a Uniswap Foundation based in the United States, which will cost US$74 million. The proposal gained mixed feedback from the community.

DEX Protocols Metrics

Lending Protocols Metrics

Charts on Layer 2 Projects

• Overall, the L2 market saw +12.16% growth over the past week. Optimisitic rollup and zero-knowledge rollup projects gained +19.34% and +1.01%, respectively, while Ethereum’s TVL rose +6.08%.

• TVL of optimistic rollups continued to surge and was over US$4.7 billion. Again, Optimism led the growth (+40.58%) in TVL, followed by Metis Andromeda (+20.14%) during the week.

• TVL of ZK rollups was stable in the last week with over US$859 million. ZKSwap was under the spotlight as its TVL of version 2.0 and version 1.0 surged +47.23% and +16.25%, respectively.

Further Reading

• Vitalik: Centralized USDC could decide the future of contentious ETH hard forks
• Lido community passes second proposal for token sale to Dragonfly Capital
• White hat hackers have returned $32.6M worth of tokens to Nomad bridge
• Ethereum users flock to Optimism for Aave liquidity mining launch
• Near Potocol discloses wallet breach that may have exposed private keys

Author

Research and Insights Team