Contango

Contango v2 users can now set up automated alerts through Otomato's notification service at otomato.xyz. **Available notification types:** - Health factor drops - APY turns negative - X account activity updates The integration allows traders to monitor their perpetual positions and looping strategies in real-time, receiving timely alerts about critical changes to their DeFi positions. This builds on Otomato's previous partnerships bringing notification services to other DeFi protocols.

Contango has published a comprehensive guide on operational security (OpSec) practices for crypto users, addressing the recent wave of security breaches in the space. The guide, titled "Are You OpSecxually Active?", covers essential security measures for protecting digital assets and personal information. **Key topics include:** - Best practices for wallet security and private key management - Identifying and avoiding common phishing attempts - Secure communication methods for crypto activities - Hardware and software security recommendations The timing of this resource comes as the crypto community has witnessed multiple high-profile security incidents, making OpSec awareness more critical than ever. Read the full guide: [Are You OpSecxually Active?](https://medium.com/contango-xyz/are-you-opsecxually-active-d23b19b2e3f1)

**Contango v2 remains operational** following the rsETH/LayerZero exploit, though affected markets now have limited functionality. **Key points:** - Frozen markets on Aave still allow users to repay debt and close loops - Users can seek assistance managing positions via Discord - The exploit affected rsETH markets on Aave V3 and V4, which have been frozen - Freezing prevents new deposits and borrowing against rsETH collateral - Aave's contracts were not compromised; the exploit relates to the Kelp DAO rsETH bridge Aave is reviewing information about rsETH borrows that occurred after the exploit. If the protocol accumulates bad debt from this incident, they will explore paths to offset the deficit. [Learn more about Contango](https://contango.xyz)

Contango examined user retention across DeFi protocols, revealing key insights about what keeps users engaged. **Key Findings:** - **Fluid** maintains strongest retention by keeping collateral productive while earning yield, reaching $6B market size with minimal churn - **DeFi Saver** retains users through automation - managing $395M across 1,100+ positions without manual intervention - **Lazy Summer Protocol** and **Infinex** show high churn after reward campaigns end, exposing limits of points-based retention - **Defi.app** delays churn through 12-month token locks with 100% bonuses **Contango V2 Performance:** Reached $584M peak open interest and became second-largest leverage trading app after Hyperliquid. However, user correlation with DEX activity dropped from 70% to 14% as free looping widgets emerged and yield opportunities fragmented across chains. **V3 Strategy:** Three lessons inform development: 1. Points buy time, not loyalty - genuine retention requires core product value 2. Automation keeps capital locked - power users need set-and-forget tools 3. Idle capital creates flight risk - positions must stay productive Contango V3 aims to address these challenges with improved automation and capital efficiency. [Read full analysis](https://medium.com/contango-xyz/an-analysis-of-contango-v2-churn-715acf9e1199)

**New Trading Options Available** Two new long-dated Principal Tokens (PT) from Cap Money are now accessible for loopers: - PT-stcUSD-23JUL2026 - PT-cUSD-23JUL2026 **Important Considerations** Liquidity for these tokens is currently building up. Traders should exercise caution when entering positions due to developing market depth. **Recent Context** This follows the recent launch of two Ethena PT loops paired against different quotes (PT-sUSDe-7MAY2026 and PT-USDe-7MAY2026), which benefit from deep liquidity provided by Aave.

**Nexus** emerges as the **leading insurance protocol** in DeFi, operating on mainnet while providing comprehensive coverage across all chains where Contango is deployed. **Open Cover** functions as Nexus's **L2 alternative**, working in tandem to expand insurance accessibility and reduce costs. Key benefits: - Cross-chain coverage for Contango deployments - Mainnet security with L2 efficiency - Comprehensive DeFi protection Both protocols offer essential risk management tools for traders and liquidity providers in the evolving DeFi landscape.

**New Trading Opportunities Available** Ethena Labs has released new maturities for both USDe and sUSDe tokens, expanding options for traders and investors. **Deep Liquidity Benefits** - Aave's robust liquidity allows users to post **$1M margin** seamlessly - Zero slippage when closing positions if using same base and quote assets - Enhanced capital efficiency for large trades **Previous Context** This follows Ethena's successful Liquid Leverage launch, which attracted over **$1.5B in inflows** within its first week. Aave subsequently increased capacity limits: - ~$350M capacity for sUSDe - ~$300M capacity for USDe The expanded infrastructure enables more users to access leveraged exposure to sUSDe rates while maintaining better liquidity profiles through USDe holdings with no cooldown periods. *Ready to explore these new maturities and enhanced liquidity options?*

**Contango announces TANGO token buybacks** following the recent Balancer exploit response. **Key Details:** - Buybacks will use **100% of protocol fees** collected since the exploit - **100% of future protocol fees** will fund buybacks until v3 launch - Maintaining current **80/20 Balancer pool** as primary liquidity - Purchased tokens will be held in Treasury **Why This Matters:** - 80/20 pool offers **lower impermanent loss** for liquidity providers - Configuration **amplifies market impact** of buybacks - Supports healthier token environment during v3 transition **Timeline:** Buybacks executed via TWAP orders over coming weeks. Team will review pool performance after initial phase to determine next steps for protocol-owned liquidity. Contango remains fully operational with v3 development as top priority.

A trader with $31M in open interest on Contango achieved remarkable success through extreme patience and simplicity. **The Strategy:** - Made only **2 trades** in over 12 months - Opened long positions on wstETH/ETH: - 2800 wstETH on Spark - 3813 wstETH on Morpho - Total exposure: 6613 wstETH **The Results:** - Currently **in profit** on both positions - Earned almost **$13k in extra rewards** from underlying markets - Hasn't claimed a single reward yet - Used multisig wallet with no MEV attacks **Key Insights:** - Demonstrates power of **"loop and wait"** strategy - Leveraged liquid staking tokens for yield - Avoided complex trading and market timing - Shows discipline in long-term position management This whale's approach contrasts sharply with active traders, proving that sometimes the best strategy is simply opening quality positions and letting time work in your favor. *Trading on leverage carries significant risk - not financial advice.*

$TANGO rewards were distributed to Contango traders on Tuesday, with **Safe multisig users receiving a 3x multiplier bonus**. **Key Details:** - Standard reward distribution for all active traders - **3x boost** specifically for @safe wallet users - Part of ongoing SafeBoost campaign incentives This distribution follows Contango's regular reward system based on trading activity and points accumulation. The Safe multisig bonus continues to provide significant advantages for users prioritizing security. *Trading on leverage carries significant risk - not financial advice.*