Welcome to Finance Redefined, your weekly dose of essential decentralized finance insights — a newsletter crafted to bring you the most significant developments from the past week.
This week brought renewed crypto interest from large holders, or whales, who are positioning themselves for the next potential altcoin rally through “strong buy walls” for future altcoin demand.
The decentralized finance (DeFi) space is also experiencing a revival, as active DeFi loans have risen to above $13.3 billion, which is a level not seen since 2022.
“Whales are preparing for the next altcoin rally” — CryptoQuant founder
CryptoQuant founder Ki Young Ju believes that crypto whales are positioning themselves in anticipation of the next altcoin rally as traders hotly debate when altseason will begin.
Ju’s analysis centered around the one-year cumulative buy/sell quote volume difference for altcoins, a metric that measures the differential between buy and sell limit orders using a one-year timespan.
The analyst explained that whales prefer limit orders to avoid slippage, and the rising level of the metric suggests an increasing number of buy-limit orders among large crypto investors and institutions, representing “strong buy walls” of future demand for altcoins.
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DeFi is “waking up again” — Active loans return to 2022 levels
DeFi may be experiencing a revival, with key metrics such as active loans and total value locked (TVL) on the rise since their more recent lows in 2023.
Crypto market analytics platform Token Terminal proclaimed that “DeFi is waking up again” in a July 31 post on X.
It backed up this claim with charts and statistics, one of which was for active loans, which have returned to levels not seen since early 2022, at around $13.3 billion.
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Morpho secures $50 million funding led by Ribbit Capital for onchain lending
Decentralized finance protocol Morpho Labs has raised $50 million in funding following a recent revamp of its business.
The round was led by Ribbit Capital with participation from a16z Crypto, Coinbase Ventures, Variant, Pantera Capital, Kraken Ventures and other investors. Morpho Labs had previously raised $23.6 million across multiple funding rounds, including an $18 million Series B funding round a16z and Variant in 2022.
The funds will be used to support the recently launched Morpho Blue, a permissionless lending protocol that allows entities to create and manage their own markets without needing prior approval from any central authority. The solution also offers vaults that can be tailored with specific risk management parameters.
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Terra chain halts operations, ASTRO token falls over 60%
The Terra blockchain has announced that it will be temporarily halted at block height 11430400, and user transactions will no longer be processed during the downtime.
According to Terra’s official X post, the team will work with Terra (Phoenix-1) validators to apply an emergency patch after the suspension to “remediate a suspected exploit.”
An X post by Cyvers Alerts revealed that the exploit resulted in the theft of approximately 60 million Astroport (ASTRO) tokens, 3.5 million USD Coin (USDC) tokens, 500,000 Tether (USDT) tokens and 2.7 Bitcoin (BTC).
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Over 70% of hacked funds are lost to CeFi entities — Cyvers
Centralized finance (CeFi) entities are the largest target of cryptocurrency hackers in 2024.
Over 70% of the funds lost through cryptocurrency hacks are stolen from CeFi entities, according to Deddy Lavid, the co-founder and CEO of Web3 security firm Cyvers.
The CEO told Cointelegraph that CeFi entities account for about 70% of incidents both in terms of lost funds and amount of exploits:
“[CeFi] is roughly 70% of the incident landscape. Having said that, attacks against smart contract-based projects are on the rise. The biggest security vulnerabilities today stem from both the code and personal negligence.”
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DeFi market overview
The majority of the 100 largest cryptocurrencies by market cap have ended the week in the red, according to data from Cointelegraph Markets Pro and TradingView.
Out of the top 100, Base-native meme token Brett (BRETT) saw the biggest decline of over 55% on the weekly chart, followed by Solana-based memecoin Dogwifhat (WIF), which fell over 54%.
Thanks for reading our summary of this week’s most impactful DeFi developments. Join us next Friday for more stories, insights and education regarding this dynamically advancing space.