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BTC $96,420 +2.34% ETH $3,280 +1.82% SOL $185.40 -0.92% BNB $642.50 +0.45% XRP $2.18 +3.12% DOGE $0.082 -1.50% ADA $1.05 +0.80% AVAX $42.10 +1.15%
04/16/2025

Last Week in DeFi: From Stablecoin Depeg to U.S. Law Clearing the Path

The decentralized finance (DeFi) market had another volatile week packed with major developments: sUSD lost its peg, PancakeSwap sparked controversy over voting rights, the U.S. formally repealed a rule that had burdened DeFi protocols, and major projects pushed forward with liquidity expansion moves. Here are the highlights worth knowing: 1. sUSD Depeg: Confidence in SNX Shaken Synthetix's sUSD stablecoin has been trading below $0.90 following the passage of SIP-420. The

Last Week in DeFi: From Stablecoin Depeg to U.S. Law Clearing the Path

The decentralized finance (DeFi) market had another volatile week packed with major developments: sUSD lost its peg, PancakeSwap sparked controversy over voting rights, the U.S. formally repealed a rule that had burdened DeFi protocols, and major projects pushed forward with liquidity expansion moves. Here are the highlights worth knowing:

1. sUSD Depeg: Confidence in SNX Shaken

Synthetix's sUSD stablecoin has been trading below $0.90 following the passage of SIP-420. The core issue is the rollout of a delegated pool mechanism — which incentivizes users to mint sUSD at a much lower collateralization ratio (200%, down from over 500% previously).

This created heavy supply pressure without a corresponding uptick in demand, compounded by lingering negative sentiment toward algorithmic stablecoins. With users no longer managing their own debt positions, arbitrage opportunities (buying cheap sUSD to repay debt) have also disappeared, making the situation worse.

2. veCAKE and the PancakeSwap – Cakepie Controversy

One of the week's most contentious events was PancakeSwap moving to strip Cakepie — a Convex-style platform — of its voting rights. PancakeSwap argued that Cakepie had been gaming its voting power to redirect CAKE rewards toward low-performing pools, undermining the broader ecosystem.

While the move doesn't technically violate the veToken model's logic, it raises real questions about how much control a founding team should wield over a mechanism that's supposed to be decentralized. Some analysts suggested that instead of a hard intervention, PancakeSwap could cap per-pool rewards or encourage more organic veCAKE competition.

3. DeFi Gets Relief in the U.S.: IRS "Broker" Rule Officially Repealed

On April 11, the U.S. President signed into law a bill repealing the IRS's "DeFi broker" rule — which had required decentralized protocols to report user identities and transaction data.

This is widely seen as a historic turning point, clearing the way for DeFi platforms to operate in the U.S. without the threat of overly burdensome regulatory requirements. While markets didn't react sharply in the immediate aftermath, analysts view this as a significant long-term tailwind for the sector.

4. Uniswap Returns With a $5 Million Liquidity Mining Campaign

For the first time in five years since its last liquidity incentive program, Uniswap has deployed $5 million in $UNI tokens to incentivize 12 pools on the Unichain network. The move is designed to deepen liquidity for key assets including USDC, ETH, WBTC, UNI, and various LSDs (Liquid Staking Derivatives).

5. Cosmos IBC Eureka Launches: Bridging to Ethereum

Cosmos is pushing deeper into the multi-chain arena with the launch of IBC Eureka, which enables connectivity between Cosmos and EVM chains like Ethereum. Each IBC v2 transaction burns $ATOM as gas, introducing a powerful deflationary mechanism for ATOM's supply.

Over the past week, the Cosmos ecosystem recorded $11 billion in asset inflows — a potential turning point that could help ATOM reclaim relevance after a prolonged period of underperformance.

6. Berachain Adjusts Incentive Distribution After TVL Decline

Berachain — the DeFi platform that made waves in March — is overhauling its incentive distribution model to address a sharp drop in TVL. The team has capped rewards per vault at 30% and introduced a new oversight mechanism. Both OlympusDAO and Yearn are restructuring their farming strategies on Berachain in response.

Conclusion

Last week was a clear demonstration of just how complex and interconnected DeFi has become. From stablecoin trust issues to voting power disputes, from U.S. policy shifts to new chain expansions — DeFi continues to evolve at a relentless pace.

But like any revolution, temporary crises such as the sUSD depeg or the veToken controversy are an inevitable part of the process. What matters most is how the community learns and adapts.