Scalara announces the results of the April 2023 rebalance of the DeFi Pulse Index.
The DeFi Pulse Index is a digital asset index designed to track the performance of some of the largest protocols in the Decentralized Finance (DeFi) space.
Since its January rebalance three months ago, the DeFi Pulse Index is down 6%.
Year to date through end of April, the DeFi Pulse Index returned +32% led by Loopring (+85%), Synthetix (+70%) and Yearn (+61%).
DeFi Pulse Index rebalance weights
The above index weightfactors and weights were calculated using prices and circulating supplies of all 11 tokens as of April 27, 2023.
At the April 2023 index rebalance, one token was removed from and two new tokens were added to the DeFi Pulse Index, resulting in now 10 index constituents.
SUSHI was removed due to the project’s decreased usage: Both from a total value locked (TVL) and trading volume perspective it has been trailing other decentralized exchanges (DEXes). DEXes are a segment that continues to be represented in the DeFi Pulse Index by Uniswap and Balancer. At the same time SUSHI was also the smallest constituent of the index by market cap weight.
A new segment
The two largest weight changes in the index were the additions of Lido (LDO) and Rocket Pool (RPL). Both projects offer liquid staking solutions that allow users to benefit from the rewards of participating in the proof-of-stake consensus mechanism of the Ethereum blockchain (i.e. Ethereum’s staking yield) while at the same time remaining liquid by issuing tradable receipts. In mid-April the Shapella upgrade finally enabled stakers to redeem their staked ETH.
Lido and Rocket Pool are the two largest liquid staking protocols with currently $12 billion and $1.5 billion staked respectively. LDO is the governance token of the Lido DAO that gives holders the right to vote in governance decisions. RPL is the governance token of the Rocket Pool protocol and can also be used as an insurance deposit in the protocol.
In order to reduce the market impact of the index change, both additions are phased-in. Therefore, at this rebalance both tokens are only weighted using one third of their market capitalization. As a result of the addition all other constituent weights decrease (except for UNI due to its continued 25% capping). The total one-way turnover of the rebalancing is 15.1%
The DeFi Pulse Index covers several distinct segments of the DeFi ecosystem.
// Learn more: From TradFi to DeFi
With the addition of Lido and Rocket Pool a third significant segment is added to the index in addition to exchanging and lending assets.
- Decentralized Exchanges: 36.4%
- Lending & Borrowing: 31.5%
- Liquid Staking: 15.0%
- Derivatives: 12.6%
- Asset Management: 4.5%
Furthermore, liquid staking is a financial service that does not have an immediate analogue in the traditional financial world. In the decentralized world, though, validating transactions is the basis of all network activity.
Scalara is dedicated to creating and maintaining indices for a decentralized world.