All referenced data can be accessed directly on the Gearbox dashboard by RiskDAO.
The RiskDAO published a post-mortem about the USDC de-pegging event with a Gearbox-specific summary. The article is available here.
US Banking collapse
Last weekend saw one of the most dramatic banking events since the GFC. Three crypto-friendly banks (Silvergate, SVB, Signature) all were taken over by the FDIC/FED as they could not sustain a bank run on their deposits.
In the wake, a major stablecoin crisis was triggered as Circle disclosed having $3.3bn in deposit with SVB. USDC and stablecoins that are backed by USDC (DAI, FRAX) all de-pegged causing serious ripple effects across DeFi. Crypto projects rushed to Twitter to quantify the $-exposure to SVB. By the time the weekend was over, the US banking regulators agreed to backstop all deposits thereby limiting any losses from bank insolvencies. As a result, USDC and related stablecoins closed the $-peg. In the meantime, USDT and BTC traded at significant premiums as a rush to safety set in.
Binance “Industry Recovery Initiative”-fund to be allocated to crypto
CZ announced that $1bn from the “industry recovery initiative” would be used to purchase BTC, ETH and BNB. On Monday 13 March, BTC & ETH showed double-digit gains of >10%.
Alpha Homora x Iron Bank
Almost forgotten in last week’s carnage, this stand-off still has not been resolved. As of last week, it appeared as if AH gave in to IB’s demands and allowed AH protocol bad debt to be transferred to its users. However, this AH snapshot vote from 13 March highlights that the community is opposed to this solution and wants to hear alternative proposals. In the meantime, $40m of user deposits remain frozen on IB (ETH Mainnet).
IB offered to individually unfreeze markets but AH declined arguing this would be unfair towards users.
GUSD liquidity decreased from $41.5m to $15.6m. sUSD liquidity remained stable at $26.6m. LUSD decreased from $29.7m to $24.8m. sUSD backing increased from 447% to 504%. LUSD backing amounts to 278% (up from 246%).
There are no material oracle deviations between DEX and CEX prices.
stkcvxcrvPlain3andSUSD has an outsized share within the collateral pool as it accounts for 39% (-200bps) of the total. This in itself does not pose a specific red flag but deserves extra attention to avoid concentration risk from building up.
Pools summary (weekly comparison)
Total pool size decreased from $19.8m to $14.5m. stkcvxcrvPlain3andSUSD remains the #1 asset at $11.3m (-$2.3m), followed by yvDAI at $1.1m (unchanged) and stkcvxgusd3CRV at $0.9m (-$3m).
Total debt decreased from $16.8m to $12m.
The pool remains predominantly collateralized by stablecoins.
Total pool collateral decreased from $34.5m to $20.7m, with the largest collateral assets being stkcvxcrvPlain3andSUSD (-$6.5m to $15.4m) & USDC at $1.5m, followed by stkcvxgusd3CRV at $1.3m.
This pool also remains large backed by stablecoin assets.
Total debt decreased from $28.8m to $17.1m.
The pool experienced a decrease from $31.8m to $30.8m. The largest collateral assets are stETH (+$0.4m to $17.4m), stkcvxsteCRV (-$0.3m to $10.7m) and yvWETH (-$1m to $1.4m).
The pool remains collateralized by mostly ETH or staked ETH assets.
Total debt decreased from $25.8m to $25.1m.
This is a new pool that went online recently. It has total collateral of $2.5m, mostly in the form of stkcvxFRAX3CRV-f ($1.5m) and stkcvxgusd3CRV ($0.3m).
Total debt stands at $2m
The WBTC credit account has seen inflows of $0.4m in the last week, in the form of stETH. Total debt amounts to $0.3m.
Demand for borrowing stETH continues to be subdued with no active credit accounts. This is a continuation from the previous week.