Key news in Ethereum ecosystem from last week
Sep 2 - Sep 8
TL;DR
Polygon developers began converting MATIC tokens to POL on September 4th.
Penpie was hacked on September 4th, with approximately $27 million worth of crypto assets stolen.
Solidity announced the release of Solidity compiler version 0.8.22 on September 4th.
FLock.io announced on September 3rd that it had received a grant from the Ethereum Foundation Research Grants 2024 Academic Round.
Euler announced the re-launch of its v2 modular DeFi lending protocol on September 4th.
Base released its 2024 scaling roadmap on September 5th.
Ethereum ACDC conference: PeerDAS Devnet 2 was expected to be reconstructed based on the Pectra upgrade.
Vitalik Buterin: All token earnings would be donated to support public goods or charitable causes within the ecosystem.
VanEck announced it would close its Ethereum futures ETF "EFUT".
Data:
Ethereum spot ETFs saw net outflows of $91.04 million in a single week last week.
The total liquidation amount in Ethereum's on-chain lending market reached $436 million in August.
In August, the number of new Ethereum Name Service (ENS) domain registrations reached 19,463.
The U.S. Spot Ether ETF had one-week net outflows of $91.04 million from September 3rd through September 6th. The Grayscale Ether Trust ETF ETHE had weekly net outflows of $111 million, and ETHE's historical net outflows now stand at $2.67 billion.
Total liquidations in the Ether on-chain lending market reached $436 million in August, with Aave accounting for approximately 66% of total liquidations ($289 million). This is the second highest monthly Ether on-chain lending market liquidation in history, just below May 2021, when approximately $671 million was liquidated.
Dune data shows that 19,463 new domain names were registered on the Ether domain name service ENS in August. In addition, the total number of active domains reached 1,956,618, with 885,021 ENS unique participant addresses and a Names set of 876,218.
Kroma, an Ethernet L2 solution, announced on September 2 that it has closed its Series A funding round with participation from Asia Advisors Korea, Gate Ventures, ICC, Planetarium, Presto, RFD Capital, Taisu Ventures, The Spartan Group, and Waterdrip Capital. Waterdrip Capital and others, with an undisclosed amount of funding. The funds raised will be used to advance Kroma's goal of “making Web3 more accessible through advanced L2 solutions powered by Tachyon, a zk proof library”.
FLock.io, a decentralized AI training platform, announced on September 3 that it has been awarded a grant from the Ethernet Foundation Research Fund's 2024 Academic Grant Round, the only AI infrastructure project among the winners. The awarded funds will be used to research incentives for blockchain-based machine learning solutions to curb malicious behavior in the decentralized AI development lifecycle. The project will benefit the larger ecosystem by utilizing smart contracts to enable secure dAI systems that adhere to principles of security, trust, and computational integrity while maintaining data privacy.
21Shares Parent Company 21.co Launched Encapsulated Version of Bitcoin 21BTC on the Ether Network on September 3. 21BTC's minting and destruction process is managed by 21.co's Onyx Asset Management Operating System and uses Chainlink's Proof-of-Reserve and Secure Minting technologies to provide additional transparency and security.
Penpie, a DeFi protocol built on Pendle, was hacked on September 4, stealing approximately $27 million in crypto assets, including various types of pledged Ether, Ethena's sUSDE, and encapsulated USDC stablecoins.
World Liberty Financial, a crypto project promoted by Trump's son, will build lending services, including a credit account system built on Aave and Ether blockchain to facilitate decentralized lending, according to an excerpt from a World Liberty Financial white paper obtained by CoinDesk. The project will also include a new cryptocurrency, WLFI, a non-transferable governance token. The paper and other reports describe a lending service that is remarkably similar to Dough Finance (developed by four people listed as members of the World Liberty Financial team).
Solidity, the ethereum programming language, announced the release of version 0.8.22 of the Solidity compiler on September 4. The latest version of the compiler will support Custom Errors, which are required for traditional pipelines, optimize the IR's caching to speed up compilation through the IR, and fix several bugs.
Polygon developers have begun converting MATIC tokens to POL on September 4, and POL tokens are now native Gas and Pledge tokens on the Polygon PoS chain.MATIC holders on Polygon PoS do not need to take any steps, and upgrading to POL will happen automatically. However, MATIC holders on Ether, Polygon zkEVM, or centralized exchanges must proactively migrate their tokens to POL via the migration contract.POL will maintain MATIC's existing token economy, distribution, and total supply of 10 billion tokens.The initial exchange ratio between MATIC and POL is set at 1:1, with an incremental increase in unlocking of 2% over ten years to support growth.
Synthetix announced on September 4th that it will launch its application chain, SNAXchain, on Optimism on September 16th. the current version of SNAXchain is Phase 1 of building functionality into the chain. As Synthetix expands to other chains and L2s, SNAXchain will act as a neutral hub for governance, protocol decisions, etc. Synthetix has partnered with Conduit to manage the chain infrastructure, and with Wormhole to enable cross-chain messaging between SNAXchain and Optimism and the main Ether network.
Lending Protocol Euler announced the re-launch of its v2 modular DeFi lending protocol on September 4. Having been audited 31 times, Euler v2 allows developers to deploy ERC-4626 vaults without a license via the Euler Vault Kit and connect to other vaults using the Ether Vault Connector. Each vault can recognize deposits in existing vaults as collateral.Euler's front-end interface supports four vault categories at startup: custodial collateral, regulated, unregulated, and revenue aggregation vaults. Previously, Euler v1 was hit by a $197 million flash credit attack in March 2023.
Base released its 2024 expansion roadmap on September 5th. Since the launch of the mainnet, Base has increased its per-block gas target from 2.5 Mgas/s to 10 Mgas/s, a 4x increase in throughput. Since the end of September, Base has committed to increasing its gas target by 1 Mgas/s per week, with the possibility of accelerating to 2 Mgas/s per week in the future. base is actively involved in the development of PeerDAS (Peer Data Availability Sampling) as part of EtherChannel's upcoming Pectra upgrade. The team is calling on Base to significantly increase blob capacity while activating PeerDAS to support larger scale-ups. To ensure fair compensation for the network, Base proposes to increase the minimum blob fee or implement a new mechanism for charging for blob data.
The Ethernet Foundation (EF) research team hosted an official AMA event at Reddit on September 5, where Justin Drake answered the question “How many years or months will it take for the Ethernet Foundation to run out of current funding?” at the AMA. In response to the question, Justin Drake said, “The financial report for the EtherFoundation (EF) will be released soon, and the EF spends about $100 million per year. The EF's main Ether wallet is worth about $650 million at current prices, and the EF also has a fiat currency reserve that will cover several years of operations. This is the part I know the least about. As Aya mentioned, Ether sales were temporarily suspended for regulatory reasons, so the reserves were not replenished until recently. As a rough estimate, the Foundation has about 10 years of reserves. This funding reserve is subject to fluctuations in the price of Ether.”
Additionally, Justin Drake answered the question “Does the EF believe it is important for ETH assets to continue to grow in value?” in the AMA. Justin Drake said, “My personal view is that the appreciation of ETH is critical to the success of Ether. Ether cannot be the settlement layer of the internet of value without ETH in fact being the programmable currency of the internet. Currency premiums only increase with the size of a particular asset (e.g., tens of trillions of dollars). Such monetary premiums are needed to: underwrite trillions of dollars of decentralized stablecoins (“economic bandwidth”), provide unquestionable security, even from nation-states (“economic security”), and attract the attention of all major economic players (“economic salience”).”
Justin Drake also stated that the value-add of ETH comes down to traffic and currency premium. For traffic, the important metric is total fees, not fees per transaction. A successful ending for Ether will be 10 million transactions per second, providing billions of dollars in daily revenue even if the cost per transaction is less than a cent. For example, $0.002 /tx would provide about 2B dollars / day in revenue. For the currency premium, the important metric is the percentage of ETH used as collateral, such as underwriting DeFi.
Christine Kim, VP of Research at Galaxy, posted a summary of the 141st EtherCore Developer Consensus (ACDC) call on September 6th. This week developers discussed changes to the EtherCore Consensus Layer (CL), various updates to the consensus layer specification and engine APIs in the Pectra upgrade (including EIP 7251 and the Beacon block body, among others), and how to address proof computation for resource-constrained node operators (primarily Home Staker) in PeerDAS.PeerDAS Devnet 2 is expected to be rebuilt on top of the Pectra upgrade, not Deneb.
Ether co-founder Vitalik Buterin responded on September 6 to a question about “Why are crypto people obsessed with founders never selling cryptocurrencies?” when replying that since 2018, it has never sold tokens (including tokens not yet in circulation) and kept the proceeds. All token proceeds are donated, again to support public goods within the Ether ecosystem or broader charitable causes. It also does not intend to invest in L2 or other token programs in the future.
Asset management firm VanEck announced on September 6 that it would be closing its Ether futures ETF 'EFUT' due to a lack of demand, as the emergence of spot ETFs dominated inflows. The reasons for choosing to close the fund “include factors such as performance, liquidity, assets under management and investor interest”.
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