All referenced data can be accessed directly on the Gearbox dashboard by RiskDAO.
Summary
The Multichain protocol ($1.5bn in TVL) has been experiencing issues for five days, with stuck transactions and several cross-chain bridge pathways not yet operational (Kava, zkSync, Polygon zkEVM). The initial explanation for the problems was a system upgrade, but was later vaguely attributed to a “force majeure”. There are rumours that the Multichain team has been arrested in China which have not been confirmed though. As a bridging protocol, some L1s & L2s are more severely exposed to Multichain: Fantom is the most exposed with 35% of its TVL being locked on Multichain, followed by BSC (10%) and Optimism (8%).
The MakerDAO community has voted in GNO as a collateral asset on the Spark Lend protocol. GNO will be added as a strategic collateral type, facilitating a credit line to GnosisDAO, which is expected to deepen DAI liquidity on the Gnosis Chain.
Ether staked has surged by 4.4m since the Shapella upgrade hitting an ATH of 22.6m ETH. About 66.9k Validators have entered the queue with an expected waiting time of 36 days. The large demand is suspected to be ETH whales that prefer to generate passive staking yield on their holdings instead of selling their holdings in the current market environment.
In other ETH-related news, Offchain Labs published a post-mortem on the ETH finality issue that occurred 2 weeks ago. The root cause of the problem was identified as certain consensus clients, including Prysm, being unable to optimally process valid attestations with an old target checkpoint. Several fixes were deployed.
The recent memecoin mania has managed to push DEX trading volumes up. In the process, the DEX-to-CEX ratio hit a new ATH of 20% as CEXes were slow to open markets in memecoins.
Centralised exchange Hotbit ceased all operations, citing a challenging market environment for crypto in general and CEXes specifically, as well as issues relating specifically to Hotbit (i.e. investigation in Summer 2022).
Stablecoin monitoring
GUSD liquidity further declined from $12m to $11m. sUSD liquidity also fell, from $20m to $18.4m. LUSD liquidity recovered from $22m to $23m. sUSD backing further improved 422% to 445%. LUSD backing stayed flat at 257%.
There are no significant oracle deviations between DEX and CEX prices. The only deviation standing out is the sUSD CEX price which is 2.7% below the oracle price.
Watchlist
stkcvxcrvPlain3andSUSD has an outsized share within the collateral pool as it accounts for 35% (-200bps) of the total. The ratio has come down from a peak of ~40%. We continue monitoring this ratio to avoid concentration risk from building up.
Pools summary (weekly comparison)
DAI
Total pool size declined by $1.2m to $12.1m. stkcvxcrvPlain3andSUSD remains the #1 asset at $7.2m (-$0.6m), followed by stkcvxgusd3CRV at $2.9m (-$0.5m) and yvDAI at $1.2m (unchanged).
Total debt also declined by $1m to $10.2m.
The pool remains predominantly collateralized by stablecoins.
USDC
Total pool collateral declined from $20.2m to $18.9m, with the largest collateral assets being stkcvxcrvPlain3andSUSD at $11.8m, followed by stkcvxgusd3CRV at $3.8m and stkcvxFRAX3CRV-f at $1.3m.
This pool also remains largely backed by stablecoin assets.
Total debt fell from $16.5m to $15.5m.
WETH
The pool slightly increased from $21.4m to $21.8m. The largest collateral assets are stETH (+$0.5m to $17.6m), stkcvxsteCRV ($3.2m, unchanged) and FRAX ($0.5m, unchanged).
The pool remains collateralized by mostly ETH or staked ETH assets.
Total debt increased from $17.3m to $17.7m.
FRAX
This pool has total collateral of $3.7m (unchanged), mostly in the form of stkcvxgusd3CRV
($1.8m), stkcvxcrvPlain3andSUSD ($0.9m) as well as yvDAI ($0.8m).
Total debt stands at $3m.
WBTC
This is a relatively small pool with $0.4m in deposits (denominated in stETH) and $0.3m in loans. It’s heavily concentrated with one depositor and one borrower.
wstETH
Demand for borrowing stETH continues to be subdued with no active credit accounts. This is a continuation from the previous week.