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DeFi Tokens in Chainlink, Lido Finance, MakerDAO Jump 7%

New updates for Chainlink, post-merge improvements for Lido, and Maker’s impressive revenues have helped these DeFi tokens take flight.

4 min read
DeFi has been the center of regulatory attention of late. Image: Shutterstock.

The DeFi market is warming up as winter sets in.

The decentralized oracle protocol Chainlink and its native LINK token have risen by nearly 8% over the past 24 hours, according to CoinGecko. The token is now trading at $7.65 on Tuesday morning and enjoys a market capitalization of more than $3.7 billion.

Chainlink’s oracles are used throughout the decentralized finance (DeFi) sector to provide pricing data to various projects.

Of late, the crypto project and Coinbase Cloud, the San Francisco-based crypto exchange’s API and data service, have tied up to bring a similar offering to the world of non-fungible tokens (NFTs).

These new oracles will scan various blue-chip NFT prices across various marketplaces to determine the floor price, or lowest purchase price for a jpeg in a collection. Feeds like this would allow developers to build out more complex NFT-based projects, like indices and lending markets.

Chainlink is also undergoing a hefty overhaul, with the project’s co-founder Sergey Nazarov announcing a new staking service to be launched in December. “Staking is going to distribute the value the system accrues to the relevant participants—the nodes and the stakers,” he said at SmartCon 2022 in September.

Beyond crypto oracles and price feeds, Lido Finance, the highly-popular liquid staking protocol, is also enjoying a bullish uptick. LDO, the project’s native governance token, is currently up over 7% over the past 24 hours. The LDO token is used to vote on various proposals to improve the project.

LDO is now trading hands at $1.57 following the hefty run-up; still, the token is still nearly 80% off from its all-time high of $7.3 set back in August 2021, according to CoinGecko.

There have been fewer technical updates for the staking project, but following the Ethereum merge last month, some of Lido’s fundamentals have improved. For instance, Staked Ethereum (stETH), the token that users receive in return for staking ETH on the platform, has moved closer to price parity with Ethereum.

Currently, Ethereum trades at $1,347, while Staked Ethereum trades at $1,339, marking a discrepancy of roughly 0.6%. This is in stark contrast to the whopping 6% depeg which occurred over the summer. This, plus the project’s continued dominance in the liquid staking niche, may have played a part in LDO’s recent rise.

Liquid staking market; Coinbase in blue, Lido in purple. Source: Dune Analytics.

Last but not least, Maker’s MKR token is also in the green today, rising by more than 8%. The governance token is now trading hands at roughly $840, and the project currently commands a market capitalization of over $758 million.

Maker is the unofficial central bank for DeFi. Its decentralized stablecoin DAI is the third-largest dollar-pegged asset in the crypto market after Circle’s USDC and Tether’s USDT.

The rise in MKR’s price comes amid several new proposals for the protocol. Recently, the Winklevii-led crypto exchange Gemini proposed depositing its native GUSD stablecoin with MakerDAO to generate a yield of 1.25%. Coinbase made a similar move earlier in September, offering the DeFi platform 1.5% on its USDC holdings.

This adds continued fuel to Maker’s business model, which Token Terminal has established as being the third most profitable in the entire industry.

Earnings, which Token Terminal defines as a project’s revenue minus its token incentives, for Maker are at $141.4 million since the sound business dashboard began. NFT marketplace OpenSea and crypto wallet provider MetaMask currently hold the top spots.

For now, this metric may not mean much for MKR holders. Earlier this year, however, there was chatter that users may soon be able to stake their holdings and earn a slice of the protocol’s revenue. The model is akin to how decentralized exchange SushiSwap leverages its Sushi and xSushi tokens.

There haven’t been any updates around the staking discussion, but perhaps the continued stream of updates has been enough to entice investors.

Disclaimer

The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.

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