Defi Development Corporation Joins Network’s Airdrop Farmers

As $SOL price drops 43% in 60 days and mNAVs collapse, Solana Digital Asset Treasuries are turning to creative methods of bolstering yields and outperforming their rivals.

Defi Development Corporation, the third-largest DAT by AUM, has announced its intention to allocate capital to Loopscale, an emerging Solana DeFi app, seeking additional yield and speculative points.

The collaboration serves as a welcome boost to Loopscale’s metrics, which have enjoyed steady growth since the lending market was exploited earlier this year.

DefiDevCorp Signs LOI with Loopscale

Defi Development Corporation, a Solana DAT boasting over $307M in $SOL, has signed a Letter of Intent with Loopscale, an orderbook-based loan market on Solana. According to the press release, DeFiDevCorp. will deposit a portion of its $SOL and stablecoin reserves to the platform to generate yield, earn Loopscale points, and ultimately boost its $SOL-per-Share (SPS).

According to DefiLlama data, Loopscale’s $SOL-denominated TVL has increased by ~100,000 SOL in the last 24 hours. 

While unconfirmed, this could represent DefiDevCorp’s first deposit into the lending protocol. DFDV has credited Loopscale’s generous stablecoin yields, which generally hover between 9-11% APY, as one of the biggest drawcards of the collaboration.

DeFiDevCorp is certainly living up to its name. By deploying funds into Loopscale, DefiDevCorp becomes the first significant $SOL-based DAT to leverage onchain applications to bolster its yield generation. Typically, Solana DATs stick to simpler yield-generation strategies like native staking, perhaps giving DFDV a competitive edge in the race to maximise SPS.

Additionally, depositing funds to Loopscale enables DefiDevCorp to earn Loopscale points, joining the ranks of Solana’s many hopeful airdrop farmers. While points-farming could be seen as an unorthodox and risky move for a publicly-traded company, one could argue that selling an eventual airdrop for $SOL is a far more capital-efficient strategy for growing SPS than holding idle stablecoins.

Loopscale Metrics Trend Up and to the Right

Despite being far from Solana’s biggest lending protocol, Loopscale has been enjoying consistent growth in recent weeks. After shrugging off a $5M exploit and recovering all lost funds in April, Loopscale has grown its TVL to over $73M, integrating a diverse range of assets into its lending markets.

Beyond its growing TVL, Loopscale’s weekly unique signers have continued to trend upwards, rising from just over 1,000 in June to as high as ~3,900 in early November.

While by no means a perfect gauge of organic activity, WUS counts the number of wallets signing transactions on Loopscale each week, effectively filtering out any bots or sybil wallets farming Loopscale points long-term.

DefiDevCorp Seeks to Raise Capital Despite Falling mNAV

Off the back of a positive Q3 earnings report, which saw DefiDevCorp record a net income of $59M and an average organic yield of 11.4%, the firm is seeking to raise further capital to fund continued $SOL accumulation.

On November 13, Defi Development Corp announced a proposed public offering of $65M of Series C perpetual preferred stock. However, with mNAV ratios compressing below 1 across the Solana DAT landscape, the firm may face difficulty finding investors willing to back the raise.

Poor $SOL price performance has had a debilitating effect on DAT health, with all the top Solana-based firms trading at a discount to their $SOL holdings.

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