This is a repost of Finance Redefined's latest installment, where Cointelegraph unpacks the latest developments in DeFi. The newsletter is delivered to subscribers every Wednesday.

Decentralized finance was reasonably quiet in terms of major primal developments, instead letting prices do the talking. Many tokens rallied, both the popular and the near forgotten. Relieve for a few hiccups due to Bitcoin's (BTC) shaky price activeness, we are yet well into DeFi season.

This price action, unfortunately, ways that using DeFi is pretty much impossible. Ethereum gas fees steadily hovered above 100 Gwei, which to any veteran will seem like an impossibly big number. While we're not quite at the 300 Gwei seen during the summertime of DeFi, it'due south worth remembering that Ether (ETH) is also worth about iii to four times as much.

For a fun exercise, try inputting your wallet address in fees.wtf and marvel at just how much money y'all threw to miners.

Average gas prices in 2021. Source: Etherscan .

The good old days when y'all could confidently send a transaction for two Gwei seem so far away now. Until we get dorsum to that point, fees will remain a serious deal-breaker for mere mortals who can't transact with tens of thousands of dollars at a time.

With DeFi, you also can't really afford to exist stingy. A transaction sent to Uniswap or another decentralized exchange has to be confirmed pretty quickly, or it's likely to fail due to slippage protection or other limits. A failed transaction stings twice: Non only does it not do what you want, it likewise consumes the gas fee anyway.

Unfortunately, there isn't much that you tin really practice about this. I did, however, write a slice this week on how to find the right time to send a transaction.

Picking the right fourth dimension is probably the nearly accessible trick. Fixing the trouble entirely, on the other mitt, requires ditching Ethereum and its liquidity. I suggest you lot yet explore the diverse non-Ethereum options available, including layer-two chains and external blockchains. Chances are you'll find what you need, assuming you're not a sophisticated ape tracking Andre Cronje's wallet for his latest unreleased projection.

Kyber announces 3.0 upgrade

Kyber Network devised a pretty absurd upgrade for its liquidity protocol. For a bit of context, the commutation used to be fairly competitive with Uniswap early on in 2020, but it savage backside in the 2d half of the year. Skyrocketing gas fees likely contributed to this effect, every bit its decentralized substitution is one of the most expensive protocols to employ.

Thankfully, the gas situation will change with the iii.0 upgrade. The team is redesigning the contracts to optimize gas employ, which hopefully will put Kyber more than on par with the remainder of the ecosystem. The new organisation is also built for integrations with layer-two platforms, which should exist useful for the long term.

The core of the upgrade is the concept of specialized liquidity pools. Instead of having ii or three decentralized exchanges doing different things — for example, Uniswap for ownership tokens and Curve for swapping stablecoins with one another — Kyber will just have different types of pools for different avails. Since Kyber is likewise an aggregator not unlike 1inch, this should make the protocol the all-in-one decentralized commutation.

Plus, the protocol will also have dynamic fees depending on volatility. This can greatly assistance with impermanent loss, as liquidity providers will exist compensated more for their potential losses.

The only real downside of three.0 is fourth dimension: Full rollout will happen in the second half of the twelvemonth.

Central bank of DSD fails to revive the project

I can't help simply chuckle at the irony of what happened this calendar week in algorithmic stablecoin land. The community of Dynamic Fix Dollar (DSD), one of many such "stablecoins" that take sprung upward recently, apparently made a pact with a whale to stop them from dumping all their DSD and depressing its toll.

The reason? The community members were holding $84 million in coupons, which were set to expire in ii days. Coupons give you the right to get newly minted coins for when the toll goes above $i. When the peg with the USD breaks downward, coupon holders shoulder the risk by burning their "dollars'' in exchange for a promise to receive more of them next time the supply expands.

Imagine my surprise when I learned that coupon holders not simply need to hope the coin'southward price e'er gets dorsum to $i, it also must do so quickly — in merely two weeks, to exist precise.

So, the community did the only natural thing and bought out 5.5 meg tokens from a whale going by "Escobar.eth," who previously dumped millions of tokens. The exchange occurred at a price of $0.62, co-ordinate to Etherscan logs.

So, with the nefarious Escobar defeated, did DSD coupon holders banquet on the next supply expansion? No.

DSD toll chart past CoinGecko .

DSD virtually reached $one afterward the news. But something went incorrect immediately after, with the coin plummeting all the way to $0.29. As you may await, those millions in coupons expired. Seriously, who buys coupons knowing that two weeks is all the time you go?

The intervention was ultimately a valiant attempt by DSD tokenholders to defend their currency, and it's really non dissimilar the fundamental banks of countries that peg their fiat currency to another. George Soros commencement became famous by successfully shorting such a peg for the British pound.

Every bit famous crypto lawyer Preston Byrne so eloquently wrote all the way back in 2017: "These situations are an object lesson in why you don't try to peg currencies: because you lot are unable to hold the peg whatever longer than you can afford to subsidize your differences of opinion with the marketplace."

In other news:

  • StakeDAO rolls out multimillion-dollar airdrop not unlike Uniswap dorsum in the mean solar day.
  • We published an overview of Ethereum competitors that show promise to take its mantle in DeFi.
  • Aave sees partial integration in Matic'southward Plasma layer-two chain.
  • BadgerDAO, a rebasing coin that follows Bitcoin's cost, launched this week.
  • Circumvolve launches swaps betwixt USD Coin (USDC) and the U.Southward. dollar, potentially connecting the cyberbanking layer to DeFi.