Receive Industry Insights

November 10, 2023

Weekly Market Recap: November 10, 2023

Fixed rates on Term diverged this week with USDC stablecoin rates dipping around -25bps to 3.245% while ETH rates rose +15bps to 2.47% on the back of a record auction that saw 953 ETH cleared.  With ETH breaking $2k in this week's rally and gas prices heating up, staking rates have been on the rise. According to the CESR Compound Ether Staking Rate Index, staking returns ranged between 3.94%-4.53% in the last five days. Should this trend hold, expect demand for ETH borrow to continue to rise.  

Historical ETH and USDC Clearing Rates on Term

Variable Rate Markets

In the variable rate markets, USDC rates continue to rise with the 30-day trailing average borrow rate accelerating to the upside. Week-on-week rates rose +58bps from 5.23% to 5.81% on a 30-day trailing basis.

image 33

Volatility in variable rate markets also rose across the board. What is notable is that in addition to the fact that intraday volatility remains elevated, variation in the day-on-day average borrow rate has increased dramatically as well.

image 34

Lastly, in a major hit to DeFi lending markets, Aave notified the community via Twitter on November 4  that they would be pausing Aave V2 on Ethereum, along with a handful of V3 markets on L2s due to a bug report submitted to the core team. As of writing Aave V2 on Ethereum remains paused for supplying and borrowing. Despite this news, TVL on Aave remains steady.

Looking forward, it is hard to say when borrow rates will begin to stabilize, but based on research from a couple weeks ago, so long as this mini bull market continues, expect rates to remain elevated.

EXCEL_YNino97jlE 1 (1)
image 35

This communication is strictly confidential and is intended exclusively for the use of the person to whom it was delivered by Terminal 0, Ltd. ("Term"). It may not be reproduced or re-transmitted in whole or in part without authorization. The contents of this communication and any attachments are solely for information purposes and are provided for your internal use only. Nothing contained herein constitutes an offer, solicitation, or recommendation to sell, or an offer to buy any securities, investment products, or investment advisory services.

This document may contain forward-looking statements and projections that are based on Term's current beliefs and assumptions and on information currently available that Term believes to be reasonable. However, such statements necessarily involve risks, uncertainties, and assumptions, and recipients may not put undue reliance on any of these statements.

Although the information provided herein has been obtained from sources which Term believes to be reliable, Term does not guarantee its accuracy, and such information may be incomplete or condensed. The information is subject to change without notice. Since Term furnishes all information as part of a general information service and without regard to a recipient's particular circumstances, Term shall not be liable for any damages arising out of any inaccuracy in the information.

The information in this presentation is not intended to provide, and should not be relied upon for, accounting, legal, or tax advice, or investment recommendations. Each recipient should consult their own tax, legal, accounting, financial, or other advisors.
The front-end interface for the Term Protocol located at is not available to U.S. persons as well as persons located in certain other jurisdictions. Please see the Terms of Use.