DeFi News
17 MIN
Apr 5, 2024

DeFi Research News March 2024

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Stablecoins Update

This is a newer section in our monthly DeFi research report. Moving forwards we want to highlight the most important events in the stablecoin space. We hope you enjoy reading it. 

Market Cap

Stablecoin market cap continued to trail up slightly from ~$141B to ~$150B ending on a positive note. The top two, USDT ($106B) and USDC ($32.3B) accounting for over 90% of the total market cap.

Solana Stablecoins

Besides the Memecoin Mania, Solana is making strides in the stablecoin market, which has long been dominated by Circle's USDC and Tether's USDT, with a combined market share of nearly 99% on the Solana blockchain. A key player in this challenge is Mrgn (formerly known as Marginfi), which is set to launch a new stablecoin with a "soft peg" to the US dollar. 

Another project, Jupiter, a decentralized exchange aggregator, is also working on developing a stablecoin solution for the Solana ecosystem, although it hasn't announced a release date yet. These projects aim to offer viable alternatives to the dominant USDC and USDT, providing more options for users on the Solana blockchain.

UXD Protocol is another interesting project in this space. It raised $3 million in funding and is building an algorithmic stablecoin that maintains its peg through a mix of cryptocurrencies as collateral, instead of the traditional cash or cash equivalents. This approach is different from the centralized models of USDC and USDT and aims to expand the use of DeFi outside the Ethereum network, where it has been most prevalent.

Bitcoin Update

Price Update

In March, Bitcoin's price was hanging around $70,000, which is pretty good and shows it's still going strong in its current upswing. It temporarily but firmly broke out to new highs, and spent four days above $70k with a peak over $73k. It has since gone through a sharp correction to briefly below $65k, liquidating some of the leverage that was building up on it. ​​The big question is where we are in this upward trend—are we just getting started, somewhere in the middle, or closer to the end? Most signs point to us still being on the earlier side, heading into the middle phase, but a few hints suggest we might be further along than it seems.

Looking at how Bitcoin's price has moved, it's just nudged past its previous highest points. In the past, when Bitcoin went on a tear, it skyrocketed way beyond its old highs. Also, when you look at the "real deal" price—what people are actually paying on average—it's only now starting to climb after hanging out in the same zone for a while.

Other clues, like how many folks are holding onto their Bitcoin for over a year, show a slight decrease, but nothing too dramatic. This bit of selling isn't huge compared to past bull runs where a lot more people cashed out. However, some deeper metrics that look at the movement of really old Bitcoin stash suggest there's quite a bit of activity, similar to what you see in the mid-to-late stages of a bull run.

So, what's the takeaway? It feels like we're moving into the middle part of the bull run, but with some signs saying we might be further along. A lot depends on how much new interest and money flow into Bitcoin. The 2017 run was massive because it was the first time Bitcoin hit the mainstream big time, while the 2021 run was kind of held back by everything else going up due to all the money floating around from pandemic stimulus.

Nic Bhatia from The Bitcoin Layer says, “Bitcoin’s last two bull runs had between 10 and 15 drawdowns of 10% or more. We are on 10%+ drawdown number two or three of this bull run, so there’s plenty of air left in the tires.”

At Coinchange, we don’t give price predictions but we are leaning towards thinking this run could be as big or bigger than 2021's, but that's just a guess based on all these different signs and what's happened before. Especially if we see a big boost in global money flowing around in the next couple of years, Bitcoin could really take off. As always, Dollar Cost Averaging (DCA) is the best strategy. 

The realized price (average on-chain cost basis) is just starting to inch up. The market price is elevated relative to realized price which is normal in bull markets, but the realized price still has quite a bit to go up in this cycle. 

When price surges 3x or 5x or 10x or more, it increasingly unlocks long-held coins to be sold. The recent bullish price action has unlocked only a tiny percentage of long-held coins, which indicates that the cycle is early and the recent price action was insufficient to trigger almost any selling.

The Deribit CCO points to bullish options trading in the $100-200K strike level for 2024 expirations.

Canadian rapper Drake on Tuesday shared a clip of Michael Saylor talking about Bitcoin to his 146M Instagram followers earlier this week.  The Coinbase App rankings are back on the rise (back in the top 100). 

Spot ETF Update

The "newborn nine" spot Bitcoin ETFs experienced a slowdown in net inflows, which, combined with a substantial sell-off related to Grayscale Bitcoin Trust (GBTC), led to a temporary net outflow of $900 million from Bitcoin ETFs. This outflow was partially offset by purchases from companies like Genesis, which sold GBTC shares but used the proceeds to buy Bitcoin directly, preventing a price crash. Despite these outflows, the demand for Bitcoin ETFs rebounded, although at a slower pace, supported by favorable macroeconomic conditions, including the Federal Reserve's indication of interest rate cuts and a $1.2 trillion omnibus bill to avoid a government shutdown.

Supply and demand dynamics also played a crucial role in Bitcoin's price movements. With Bitcoin reserves on Coinbase at a nine-year low and the upcoming halving event, which will reduce the daily Bitcoin supply, there's a strong case for a supply squeeze. This situation is made even more significant by the substantial impact of ETF demand on Bitcoin's availability and price. The interaction between ETF inflows and outflows, alongside macroeconomic indicators, is crucial for understanding Bitcoin's market sentiment. There's optimism around the continued inflow into Bitcoin spot ETFs, driven by institutional interest and global demand, suggesting a bullish outlook for Bitcoin's price in the near to medium term, with significant potential for market cap appreciation linked to ETF inflows.

U.S.'s first-ever exchange-traded hashrate futures is here!

What is it?

This product is a type of futures contract, which is a way to buy or sell something at a future date at a price agreed upon today. What makes this product special is that it's related to bitcoin mining and is aimed at helping miners manage the risks that come with changes in mining power and bitcoin's value.

What is Hashrate?

Bitcoin mining is how new bitcoins are made, and it involves using computers to solve complex math problems. The power used by these computers to mine bitcoin is called "hashrate." The hashrate's strength can affect a miner's chance of earning bitcoin. If the hashrate goes up, it means more competition, which can lower the earnings for miners.

The Halving (happening in a coupe of weeks)

Every few years, an event called "halving" happens in the bitcoin world, where the reward for mining bitcoins is cut in half. This makes mining less profitable and adds to the uncertainty for miners. The next halving is coming up soon, and it's causing worry about how it will affect miners' earnings.

The new product introduced by @LuxorTechnology and @Bitnomial will help miners manage these risks. It's the first of its kind in the U.S. to be traded on an exchange approved by the CFTC. 

The Hashprice

The contracts are based on something called "hashprice," a term that Luxor created. It measures the income miners make from a certain amount of hashrate over time. These contracts don't require the physical delivery of bitcoin. Instead, they are settled in cash based on the hashprice index created by Luxor.

This is especially useful now because the mining industry has faced challenges recently, such as bankruptcies and less interest from investors.

Ethereum update

Ethereum's Dencun upgrade

Ethereum's Dencun upgrade brought two main changes to its network. First, it added new data storage options to make Layer-2 scaling solutions more cost-effective. This is important because these solutions, like Arbitrum and Optimism, help the Ethereum network process more transactions by executing them separately and then bundling them together for the Ethereum blockchain to verify. With the Dencun upgrade, these roll-ups can now use a new type of transaction called "blobs" for their data, which is cheaper and can help reduce overall transaction costs on the network.

Second, the upgrade introduced a limit on the number of new validators (the entities responsible for processing transactions and securing the network) that can join the system. This was done to make sure the network remains fast and efficient as it grows. The change is expected to slow down the rate at which new Ethereum tokens are created, which could affect the total amount of Ethereum in circulation. Read more about the impact of this upgrade here.

ETH ETF Gets Delayed?

In a March 27 appearance on Fox Business, Larry Fink, the CEO of BlackRock, said Ether becoming classified as a security by the SEC would not be “deleterious” to its spot ETH exchange-traded fund (ETF) ambitions.

When asked if an Ether ETF would still be on the cards in the event of a securities designation for Ether, Fink said “I think so.” - per The Defiant

The discussion around Ethereum (ETH) Exchange-Traded Funds (ETFs) has been heating up, especially with recent developments involving regulatory decisions and market responses. The U.S. Securities and Exchange Commission (SEC) has postponed its decision on the VanEck spot Ethereum ETF, moving the expected decision date to May 23rd. This delay has sparked a variety of reactions from industry experts. Grayscale's Chief Legal Officer, Craig Salm, suggests that the groundwork laid by the approval process for the Bitcoin ETF might still give hope for a May approval for the Ethereum ETF. However, many, including Salm, view the SEC's delay as a deliberate move to stall the process, rather than a step towards eventual approval.

Source: Y Charts

Analysts from Bloomberg, Eric Balchunas and James Seyffart, have lowered their expectations for a May approval to a mere 25%, down from an already cautious 30%. This pessimism is echoed in the market response, with Grayscale's ETH trust (ETHE) falling to a 20% discount off its net asset value (NAV), compared to an 8% discount in February. Meanwhile, projections from Standard Chartered Bank suggest that up to $45 billion could flow into spot ETH ETFs upon approval, although this is contingent on various factors, including whether staking will be incorporated—a feature both Fidelity and Grayscale have included in their updated ETF applications, despite doubts about SEC approval.

The regulatory landscape is further complicated by the SEC's recent actions, such as subpoenaing the Ethereum Foundation and speculating on the classification of ETH as a security following the transition from proof of work to proof of stake. This speculation seems contradictory, given the SEC's prior approval of ETH futures ETFs post-merge, and it overlooks the statute of limitations on potential legal actions related to ETH's initial coin offering (ICO). Amid these discussions, opinions on whether ETH should be classified as a security diverge, with some arguing against the SEC's potential designation and others, like Swan Bitcoin, asserting that ETH meets the criteria laid out in the Howey test for being considered a security. Despite these challenges, industry leaders like BlackRock's Larry Fink remain interested in pursuing a spot ETH ETF, regardless of the SEC's final stance on ETH's classification.

DeFi Updates

According to a CoinGecko report, the Solana ecosystem has emerged as the most popular blockchain ecosystem so far this year, accounting for 49.3% of global crypto investor interest in chain-specific narratives (vs. ETH @ 12.7%).

The Superintelligence Alliance

The Superintelligence Alliance is a collaboration between three decentralized AI organizations: SingularityNET,, and Ocean Protocol. They plan to merge their respective tokens into a single token, ASI, to create a powerful decentralized AI network. This alliance aims to democratize AI technology, ensuring it is not controlled by any single entity with biased interests. Their goal is to create an ethical and transparent AI ecosystem that facilitates direct interactions between developers and users, bypassing centralized authorities. 

Key DeFi Stats for March:

In March, the TVL increased significantly in dollar terms from around $87.6B to $100B for the whole DeFi market. DEX 30day volumes have gone up to $191B up from 130 B last month after more than 5x from September 2023 at $35.2B. 

Here are the top DeFi projects based on Total Value Locked (TVL):

Source: Token Terminal. TVL of top protocols as of Apr 3rd 2024. 

A look at the top DeFi protocols based on the fees generated

Let’s look at the top 5 DeFi/NFT protocols/ecosystems with the most fees generated over 30 days, which generally translates to the most active protocols. In some cases, the protocols take a % of the fee as revenues (eg. Lido Finance) in other cases its distributed almost entirely to the Liquidity Providers Stakeholders (eg. Uniswap Liquidity Providers) hence their revenue varies based on such parameters. 

Here are the top 5 protocols for the month of March in terms of Fees generated:

Image by Coinchange, data sourced from DeFillama 

  1. First is Uniswap, under the category 'Dexes', with fees of $148.3 million and no revenue.
  2. Second is Lido in 'Liquid Staking', with $111.36 million in fees and $11.14 million in revenue.
  3. Third is PancakeSwap, also a 'Dex', with fees of $66.24 million and revenue of $16.1 million.
  4. Fourth is AAVE, in 'Lending', with $38.12 million fees and $6.43 million revenue.
  5. Last is Maker, categorized as 'CDP', with fees of $27.75 million and the highest revenue on the list at $17.79 million.

Macro View

Coinchange’s Research Team’s March ‘24 Macro analysis focuses on the current state and future expectations regarding liquidity, the U.S. business cycle, and potential re-acceleration of inflation. Starting with liquidity indicators, the U.S. dollar index rising above 104 has slightly affected global liquidity, which has been largely stagnant since late 2021. 


Although there's been a rebound from the lows of late 2022, global liquidity hasn't reached new highs, posing challenges to risk assets outside the most coveted ones. The expectation is for a positive liquidity cycle in the next two years, although actual data breakout remains to be seen. 

Regarding the U.S. business cycle, indicators suggest a gradual economic recovery, bolstered by loose fiscal policy, despite existing recessionary pressures in some sectors. This fiscal dominance, particularly the use of short-term debt, has supported market liquidity, nominal GDP, and asset prices, with the Federal Reserve's interest rate policy playing a significant role.

Source: BLS

In terms of inflation, recent data indicates a stabilization and potential uptick. The analysis critiques the varied use of inflation metrics, advocating for a balanced, data-driven approach. The expectation is that inflation in the 2020s will average higher than in the previous decade, driven by fiscal policies and energy supply constraints. While the peak of inflation was identified in mid-2022, a cyclical disinflation was anticipated, albeit within a structurally higher inflationary regime. Current indicators suggest that inflation might not only have stabilized but could be gearing up for re-acceleration, linked to energy demand and prices as well as wage trends. The narrative suggests that despite some stabilization, particularly in rent and wages, inflationary pressures remain, influenced by ongoing economic policies and market dynamics.

Regulations Update

SBF gets 25 years for FTX fraud and was fined $11B.

Is that too much or too little? There are people who lost a lot of money who claim that 25 years is not enough especially when Bernie Madoff was sentenced to 150 years for a ponzi scheme, although it went on for many more years than FTX (arguably making FTX scam worse). And those who didn’t lose money are okay with the sentencing compared to Elizabeth Holmes serving an 11-year, three-month sentence for her role in wire fraud at the now-defunct company, Theranos. Bottom line is that he is in federal prison now, and there is little to no chance of getting off earlier than the sentence. FTX users are being made whole in dollar terms, but in crypto terms they are probably getting ⅓ of the current prices. Overall nobody wins here, but we can all move on knowing that legal system is in charge of crypto scamsters. 

KuCoin and Founders Charged for Flouting U.S. Money Laundering Laws

The U.S. authorities charged the cryptocurrency exchange KuCoin and its founders, Chun Gan and Ke Tang, with serious legal violations. They're accused of running an unlicensed money transmitting business and not following anti-money laundering (AML) laws. These laws are important for stopping money from illegal activities being moved around secretly. The charges say KuCoin didn't do enough to check who its customers were or report suspicious activities, which is required by law. Despite knowing they had to follow these rules, they chose not to. This made KuCoin a place where illegal money could be hidden. The exchange got big by having lots of customers in the U.S. but tried to hide this fact to avoid following U.S. laws. Both founders are from China and are currently not in custody. The charges they face could lead to several years in jail if they're found guilty. 

OKX terminates services in India

OKX, a cryptocurrency exchange, is shutting down its operations in India nearly three months after the country's Financial Intelligence Unit (FIU) issued compliance notices to it and eight other foreign crypto exchanges. The FIU's action led to the blocking of these exchanges' websites and apps in India. OKX has told its Indian users to close their accounts and withdraw their funds by April 30, citing regulatory challenges as the main reason for its exit. Despite introducing a new registration process with strict Know Your Customer (KYC) checks, OKX has decided to cease operations in India.

The situation reflects the broader difficulties foreign crypto exchanges face in India, a market with potential but plagued by regulatory uncertainties. For nearly four years, there have been discussions about establishing a regulatory framework for cryptocurrencies in India, but the government has shown little interest in providing clear guidelines or legal oversight for the crypto industry. The lack of clear regulations, combined with a heavy tax burden on crypto income and transactions, has prompted many crypto businesses to relocate.

The Indian Finance Minister has indicated that cryptocurrencies cannot be treated the same as traditional currencies (fiat), suggesting that this stance is not unique to India but is a common response from governments worldwide.

Coinbase vs. SEC

Paul Grewal, the chief legal officer at Coinbase, recently shared an update about the case. According to him, the court has decided to proceed with most of the SEC's claims against Coinbase but has dismissed the claims related to Coinbase Wallet. Coinbase was ready for this outcome and is keen on learning more about the SEC's internal stance on crypto regulation. Despite the denial of their early motion, which is common in cases against government agencies, Coinbase aims for clarity in crypto regulations. Grewal also mentioned the importance of Congress creating comprehensive digital assets legislation in the U.S. to keep innovation within the country. He expressed appreciation for the court's recognition that innovations like Coinbase Wallet are not subject to U.S. securities laws. That’s a huge win for the likes of Exodus, MetaMask and other wallet services as a precedent that wallets are NOT brokers.  According to the latest ruling, “the Court finds that the SEC adequately alleges that Coinbase, through its staking program, engaged in the unregistered offer and sale of securities.”

Institutional Update

BlackRock Launches BUIDL fund on Ethereum Blockchain

BlackRock has made a significant entry into the Real World Asset (RWA) tokenization space with the launch of its first tokenized fund called BUIDL, which operates on the Ethereum network. This fund is specifically designed to offer qualified investors a way to earn US dollar yields by investing in a tokenized form. The BUIDL fund is focused on investments in cash, US Treasury bills, and repurchase agreements, aiming to provide investors with a stable token value of $1 while distributing dividends as new tokens on a monthly basis​. 

BlackRock has partnered with major players in the field. Securitize has been chosen to handle the tokenization and act as the transfer agent, with BNY Mellon acting as the custodian and administrator. Additionally, PricewaterhouseCoopers LLP is involved as the auditor of the fund. Key infrastructure providers for the fund include notable names in the crypto world, such as Coinbase, alongside other participants like Anchorage Digital Bank NA, BitGo, and Fireblocks​.

The fund requires a significant minimum investment of $5 million, targeting large institutional investors. Within a short span, the fund has already attracted considerable interest, with initial funding seeded at $100 million USDC, and has quickly raked in $245 million! 

MicroStrategy's Bold Bitcoin Bet: Acquiring Over 1% of BTC's Total Cap

MicroStrategy recently made headlines by acquiring an additional 9,245 bitcoins for approximately $623 million. This purchase was made possible through the proceeds from convertible notes and excess cash, with an average purchase price of around $67,382 per bitcoin. With this latest acquisition, MicroStrategy's total bitcoin holdings have increased to 214,246 BTC, acquired at an average price of $35,160 per bitcoin, representing a significant investment of about $7.53 billion. MicroStrategy is now one of the largest corporate investors in bitcoin, owning more than 1% of the total 21 million bitcoins that will ever exist. 

With the company's stock experiencing a significant increase, there have been discussions around the sustainability of this growth and the potential risks involved. Supporters argue that as long as MicroStrategy's market value remains above its net asset value (NAV), the company can continue to issue shares in a way that is beneficial to its NAV or allows it to purchase bitcoin below market costs. MicroStrategy's approach could continue to yield high returns as long as the company maintains its ability to issue shares above NAV and secure bitcoin at lower costs. This method is seen as providing access to cheaper leverage than what is available in the cryptocurrency derivatives markets. 

Michael Saylor himself has recommended buying bitcoin directly as his top investment idea but acknowledges the utility of MicroStrategy's stock for specific investors who have restrictions on direct cryptocurrency purchases

Mr. 100 continued buying

At the beginning of March he had around 51,000 BTC. By the end of March he owned 56,000 BTC worth 4 Billion! While Mr. 100 does not appear to have a strictly consistent buying pattern, each purchase is typically around 100 BTC. The number of separate buy transactions per day can vary, with some days, such as between March 26 and 28, featuring no buys whatsoever. 

However, Mr. 100’s Bitcoin accumulation spree has been relentless since first stacking BTC in this address in November 2022. The sizeable and persistent acquisitions now rank Mr. 100 among the single largest individual holders of Bitcoin. You can track his accumulation history here

Capital Raises in March 2024

Source: ICO Analytics

This image shows a list of companies that have raised funds in the Web 3 space during March 2024. The companies are listed with various details such as the amount raised, valuation, if their project is tradable, the category of the project, and the investors involved.

  • Optimism leads the board with an $89 million raise, although its valuation isn't disclosed. The project is tradable and is part of the Ethereum ecosystem, focusing on infrastructure.
  • Zama follows with a Series A round, securing $73 million. Their project, which is not tradable, seems to be working on privacy infrastructure. Multicoin Capital and Protocol Labs are among their investors.
  • Berachain is third, with a $69 million raise. It has a substantial valuation of $1.5 billion but is not tradable. It operates within the Cosmos ecosystem and focuses on infrastructure, with BREVAN HOWARD and Framework as some of its investors.
  • Figure Technologies raised $60 million in a Series A round for a project categorized under finance and banking. Their project is not tradable. The investors include jump, PANTERA, Lightseed, and FACTI0N.
  • Succinct Labs is the fifth on the list with a $55 million Series A raise. They are part of the Ethereum ecosystem and focus on infrastructure and zero-knowledge technology. Investors include Paradigm, Robot Ventures, and BANKLESS VENTURES, among +7 others.

The total money raised by these five companies in March 2024 is $346 million.

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