Crypto rug pulls exceeded DeFi exploits in losses during May Finance Redefined.
Welcome to Finance Redefined, a weekly newsletter providing essential insights into decentralized finance (DeFi) – the most significant developments from the past week are gathered here.
May saw many exit scams in the DeFi world, with over $45 million lost and less than half that amount due to exploits on DeFi protocols.
A proposal to charge liquidity provider fees as Uniswap ( UNI ) token holders was rejected by Uniswap DAO, citing tax concerns. The proposal would have allowed Uniswap’s governing body to receive a percentage of the fees currently going to liquidity providers.
Jimbos Protocol has offered an $800,000 bounty to the public after talks with the hacker failed. The protocol’s team invites anyone who could help catch the exploiter or recover the funds to claim the reward. The Fantom network has launched a “Gas Monetization Program” in which it pays developers 15% of total gas fees their apps generate, and PancakeSwap has entered the GameFi space.
- Blockchain Association supports Coin Center’s lawsuit on Tornado Cash sanctions with an amicus brief.
- Uniswap DAO rejects LP fee plan due to tax concerns raised by UNI holders.
- $800K bounty offered by Jimbos Protocol after hacker ignores deal.
The top 100 DeFi tokens had a bullish last week of May, with most of the tokens recovering from two weeks of bearish pressure. The total value locked in DeFi protocols also rose above $50 billion again.
Losses from crypto rug pulls outpaced DeFi exploits in May: Beosin
A June 1 report from Beosin revealed that the amount of cryptocurrency lost to rug pulls, or exit scams, where founders suddenly up and leave with investors’ money, had outpaced the amount stolen from DeFi projects in May. Total losses from rug pulls and scams reached over $45 million across six incidents in May.
Meanwhile, 10 attacks on DeFi protocols netted just $19.7 million. The amount is an almost 80% decrease from April, with losses from these types of exploits declining for two months.
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Uniswap DAO rejects plan to charge LP fees; UNI holders cite tax concerns
A proposal to enable protocol fees for the Uniswap decentralized exchange (DEX) failed, potentially allowing liquidity providers to continue to earn all revenue from swaps, according to the proposal’s official webpage. The “no fee” camp won by a plurality, implying that supporters of a protocol fee may have prevailed if they had united behind a specific fee percentage.
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Jimbos Protocol offers $800K bounty to the public after hacker ignores deal
DeFi platform Jimbos Protocol has offered 10% of the exploited funds to the general public after giving the hacker several days to respond to a deal.
On May 28, the Arbitrum-based DeFi app was exploited, resulting in a loss of 4,000 Ether ( ETH) . After taking advantage of the lack of slippage control on liquidity conversions, the exploiter was able to swipe assets worth around $7.5 million at the time.
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Fantom starts paying developers to generate gas fees
The “Gas Monetization Program” from the Fantom Opera network team will pay eligible developers 15% of the total gas fees their apps generate. Six Web3 apps have already been approved for the program, including ParaSwap, Beethoven X, Stargate, LayerZero, WOOFi, and SpookySwap. These apps have generated over 12,000 Fantom ( FTM) in rewards already (worth approximately $3,715).
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Decentralized exchange PancakeSwap moves into GameFi
On May 29, PancakeSwap, a decentralized exchange, announced that it had launched a new tower-defense game in partnership with Mobox, a GameFi protocol based on the BNB Smart Chain. The game, called “Pancake Protectors,” allows players to use PancakeSwap’s native token (CAKE) to earn rewards within the game.
CAKE tokens can be used within Pancake Protectors to speed up the level-up process, purchase in-game currency, claim CAKE heroes, stake CAKE to earn resources, and unlock game levels. There is also an in-game marketplace for trading CAKE heroes, which can be improved by participating in lotteries that offer non-fungible token upgrade rewards.
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DeFi market overview
Last week, the total market value of DeFi saw a bullish increase. According to data from Cointelegraph Markets Pro and TradingView, DeFi’s top 100 tokens by market capitalization had a bullish week, with most tokens trading in the green. The total value locked in DeFi protocols surpassed $50 billion.
Thank you for reading our summary of the most impactful DeFi developments this week. Join us next Friday for more stories, insights, and education on this rapidly evolving space.
We will continue to update Phone&Auto; if you have any questions or suggestions, please contact us!
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