Sonic Sundays #1
From yield opportunities, to protocol spotlights and technical 101s, Sonic Sundays is your weekly newsletter to keep you up to date with everything popping in the Sonic Ecosystem.
Wat is up sonic fam!
With sonic szn in full swing, it’s time to ramp up your weekly source of ecosystem alpha with the network’s premier newsletter - Sonic Sundays. This week we’ll dive into the thriving network metrics and data points, a protocol spotlight of Rings, a stablecoin strat of the week, and all the Sonic content you may have missed popping out on socials.
Let’s get into it.
derp!
Network Metrics
Sonic currently ranks as the 12th largest chain, with approximately $1 billion in liquidity. Over the past 30 days, its TVL has surged by 81.59%, marking the highest 1-month growth among all networks with over $100 million in liquidity.
Since launch, Sonic has experienced a significant surge in TVL, with over $179 million bridged from other networks. The largest inflows have come from Solana and Base.
With $1.01b in TVL, liquidity metrics are at an all-time high and have just broken out from a consolidation phase. While most protocols continue to see an increase in liquidity as fresh capital flows in from other chains, a notable addition is the launch of Aave, which has grown to $189m (supply liquidity) in just over a month.
Silo, an isolated lending market, is currently the largest protocol on the network, followed closely by Beets, which operates an LST and DEX, and Aave, DeFi’s largest liquidity protocol.
Protocol Spotlight
This week’s protocol spotlight is on Rings, a unique ‘meta-asset’ protocol that has played a key role in Sonic’s rapid growth.
Rings is a derivative protocol that allows users to mint scTokens (scUSD, scETH, scBTC) using trusted blue-chip collateral. Once minted, these assets can be deployed in applications or staked directly on Rings to unlock a yield-bearing version.
So, what makes Rings unique?
Its innovation lies in how underlying collateral is managed to generate yield—and how that yield is distributed.
Here’s how it works…
Users can mint scTokens on Sonic or Ethereum using blue-chip assets like ETH, stETH, and USDC.
The underlying collateral is managed by Veda Vaults, which bridges assets to Ethereum, deploys them in trusted applications, and generates yield.
The extracted yield is then bridged back to Sonic and used to incentivize scTokens across applications.
This generated yield is distributed via a gauge system, where Rings veNFT holders vote to direct yield to specific applications.
This mechanism has three key benefits:
It does not dilute the USDC and ETH yield on Sonic.
It siphones yield from another network and directs it to Sonic applications.
It incentivizes users to bridge blue chips to Sonic to Mint scTokens.
stkscTokens
The second key mechanic of Rings is the ability for users to stake their scTokens directly on the platform, unlocking a yield-bearing version. These staked assets gain automatic exposure to yield relative to their underlying scTokens, providing a passive liquidity strategy.
When users stake scTokens to receive stkscAssets, their scETH, scBTC, or scUSD is sent to a Veda Boring Vault on Sonic (Not Ethereum this time). This vault automates farming strategies across Sonic Applications, dynamically rebalancing assets and redistributing yield to stakers.
This brings multiple benefits:
Splits user's options into Yield-bearing stake vs deploying scTokens onto apps to gain Ethereum-generated yield.
scTokens receive all yield generated on Ethereum (Siphons Yield to Sonic Apps)
stkscTokens receive all yield generated by scTokens on Sonic (Boosts Sonic TVL metrics)
scTokens also receive the highest point multipliers on the network, allowing users to gain highly competitive yield rates while unlocking maximum exposure to the upcoming Sonic Airdrop.
Strategy of the week
With this in mind, this week’s strat of the week is the scUSD | USDC Boosted Pool on Beets.
Beets Boosted Pools re-hypothecate (direct) 100% of underlying pool liquidity to external yield markets to generate additional rewards while ensuring all assets remain available to facilitate and earn rewards from swaps.
This particular pool routes all USDC.e liquidity to a Silo market to earn the USDC.e interest rate, plus the additional $S incentives which Silo is incentivizing the market with. The Boosted Pool utilizes the Beefy wrapper to ensure that all additional rewards (in this case, $S) are auto-compounded in the position without a user having to claim anything.
To summarise, this Boosted Stable Rings pool on Beets unlocks exposure to:
Swap Fees – Earn swap fees for all scUSD <> USDC.e trades.
LP Staking Incentives - Beets incentivize the LP with $stS, $BEETS, and $FRAGMENTS
Lending Supply Interest – Earn the lending interest paid by USDC.e borrowers.
S Incentives - Earn the S that Silo incentivizes on the lending market.
Sonic Content
Here’s all the hottest Sonic content that you may have missed this week:
Outro
That's all for this week, sonic fam!
We've covered the explosive network metrics, dug into Rings protocol, shared a juicy scUSD stablecoin strategy, and recapped all the alpha from around the ecosystem.
Make sure to subscribe if you haven't already so you never miss these weekly doses of Sonic Alpha straight to your inbox.
Until next Sunday, keep buildin, keep stackin, and keep derpin!
