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This Week In DeFi – October 6

This Week In DeFi – October 6

Burnt has unveiled the public testnet for Xion, a Layer-1 blockchain that plans to use Circle-issued USDC stablecoin as its primary currency.

Alex Miguel
October 06, 2023

Happy weekend, DeFi readers!

This week… 👀

Burnt launches USDC-based layer-1 blockchain
FriendTech users hacked via SIM swaps
A16z leads $24M Series A for web3 loyalty app
Contango introduces decentralized futures based on Aave

Burnt launches USDC-based layer-1 blockchain

Burnt has unveiled the public testnet for Xion, a Layer-1 blockchain that plans to use Circle-issued USDC stablecoin as its primary currency.

Xion's focus areas include payments, social communities, web subscriptions, loyalty programs, and gaming.

With support from more than seventy-five partners, the new-age blockchain is looking to offer user-friendly applications within the Web3 ecosystem, backed by a native staking asset for network security.

FriendTech users hacked via SIM swaps

Crypto-based social media platform FriendTech has introduced the option to switch from phone number to email for login due to a series of SIM swap attacks targeting its users.

The attacks resulted in the loss of significant funds, with six users reporting incidents where attackers gained control over their accounts and dumped their social tokens – and running off with the proceeds.

Attackers were able to target users by taking advantage of publicly-available X profiles, obtaining their phone numbers, then facilitating SIM swap attempts with telecom providers.

If any hacker gains access to a FriendTech account via simswap/email hack, they can rug the whole account
If you assume 1/3 of FriendTech accounts are connected to phone numbers, that's $20M at risk from sim-swaps
FriendTech's current setup also technically allows a rogue dev… twitter.com/i/web/status/1…
— Manifold (@ManifoldTrading)
10:41 PM • Oct 2, 2023

A16z leads $24M Series A for web3 loyalty app

Blackbird Labs, the creators of the web3 restaurant loyalty app Blackbird, has secured $24 million in a Series A funding round led by Andreessen Horowitz (a16z).

With participation from QED, Union Square Ventures, Shine, Variant, and restaurant groups, the funding round brings Blackbird's total investment to $35 million.

Blackbird looks to boost restaurant revenue by tracking customer preferences and offering cryptocurrency rewards for check-ins, letting users to redeem them for various restaurant perks.

Contango introduces decentralized futures based on Aave

Contango, a project utilizing web3 money markets, has introduced Contango Perps (cPerps), a decentralized futures product built on Aave.

cPerps uses recursive lending positions via Aave flash loans to create leverage positions, allowing users to repeatedly use borrowed assets as collateral to increase their credit capacity.

Contango plans to expand its integrations to other money market protocols like Compound, Spark, MakerDAO, and Morpho and aims to unlock a $13 billion DeFi derivatives market across multiple protocols, highlighting that its funding rates are less volatile than those found on centralized derivative exchanges.

We just launched cPerps (Contango perps) with @AaveAave on @arbitrum 🔥
cPerps are built by automating a looping strategy on money markets, via flash loans.
Cool things:
➡️ up to $20B liquidity
➡️ 20x less volatile funding rates
➡️ Early traders will be rewarded (soon?) 👀
— Contango 💃🏾 (@Contango_xyz)
5:33 PM • Oct 4, 2023

A USDC-powered blockchain: What will we learn?

USDC-based blockchain Xion may prove to be an interesting experiment, focusing completely on ease-of-use and stablecoins for it applications.

Zooming out, it is somewhat against the foundational ethos of crypto. Looking closer, however, it may provide one of our first real-world mainstream applications showcasing what crypto can do – that regular fiat currency cannot.

Xion will be somewhat of a simulation of how crypto should look and feel in the future, once major coins reach a saturation point, with a more stable value. By removing the element of volatility, Xion will provide an ecosystem free of the crazy ups and downs of crypto assets, allowing its developers and users to focus on real use-cases and applications.

With fee abstraction and all denominations in the familiar USDC, Xion will give a much clearer glimpse into what crypto and blockchain can do for the world, without the complexities that native users have become so accustomed to.

Long term, who knows what will become of the platform – after all, it is completely reliant on a centralized stablecoin. On the other hand, it will facilitate an ecosystem that can finally thrive free of traditional crypto limitations, and teach us a whole realm of new lessons.

Also of interest is behind the curtain: The XION token and staking model. How successful might Xion be?