# defi

DeFi, or Decentralized Finance, uses blockchain to create a financial system where you can lend, borrow, save, and earn interest on your money directly over the internet, without needing banks or other middlemen. It operates with cryptocurrencies and smart contracts, making transactions automatic and secure. DeFi gives you more control over your finances and can offer higher returns, but it comes with higher risks due to its volatility and lack of regulation.

Tags
# amm
# ethereum
# lending
# trading
# yield
# bridge

Projects

Alchemix

Alchemix Finance is a DeFi protocol that allows people to create yield-backed synthetic tokens in exchange for providing their cryptocurrencies as collateral. Visitors can for example deposit their DAI into the protocol, and receive (a lesser amount of) alUSD tokens, equally pegged to $1. The protocol uses the collateral provided by its visitors to collect yield and dynamically repay the depositors' debt, essentially giving its users an immediate claim on the future yield of their tokens. The protocols native token is ALCX, used to govern the development and directional decisions of Alchemix.

Bancor

Bancor is a decentralized exchange. It is distinguished from other DEX protocols by its automated market maker, which lets people deposit liquidity in a single-sided fashion, whereas many other platforms require its visitors to provide liquidity with their tokens in an inherently two-sided way. Bancor's automated market maker mechanism achieves this through its native token, BNT, which is dynamically minted and co-invested by the protocol when visitors deposit their collateral as liquidity. Besides having BNT as the unitary counterpart asset of exchange for trading on the platform, the protocol also offers a unique solution against Impermanent Loss to its liquidity providers.

baseline markets

Baseline Markets introduces a novel approach to liquidity in the crypto market, focusing on infinite, unruggable liquidity. The platform offers a mechanism that protects a token's price using protocol-owned liquidity, ensuring a baseline value that powers the entire protocol. This approach includes features like protection against price drops (Anti-Jeet Tech), perpetual price support (Up Only, Forever), borrowing options with no liquidation (Borrowing Built-in), and fair launch practices. For projects, Baseline promises a suite of tools for price protection, no-liquidation loans, and more, aiming to make liquidity management more secure and efficient.

Circle

Circle is a global financial technology company that issues the stablecoins USDC and EUROC, and develops programmable wallets across various blockchains. Circle is regulated as a licensed money transmitter under US state law just like PayPal, Stripe, and Apple Pay. Circle’s financial statements are audited annually. ### Why? USDC is a digital dollar, that’s available 24/7 and moves at internet speed. USDC lives natively on the internet, and is available for users to spend regardless of borders and banking hours. Anyone with an internet connection can send, receive, and save USDC. A key feature of USDC is that it's always redeemable 1:1 for US dollars. USDC reserves are held in the management and custody of US financial institutions, including BlackRock and BNY Mellon.

Enzyme

Enzyme is a decentralised asset management infrastructure built on Ethereum. Using Enzyme Smart Vaults, individuals and communities can build, scale and monetise investment (or execution) strategies that employ the newest innovations in decentralised finance. Enzyme allows anyone to build, scale and monetise non-custodial Smart Vaults which can be used for creating interesting investment strategies - from discretionary and robo to ETF’s, market making, lending, yield farming and more.

Euler Finance

### What Euler is a non-custodial permissionless protocol on Ethereum that allows users to lend and borrow almost any crypto asset. Euler helps users to earn interest on their crypto assets or hedge against volatile markets without the need for a trusted third-party. ### Why? Euler introduces a number of new features in DeFi, including permissionless lending markets, protected collateral, reactive interest rates, per-second compounding interests and feeless flash loans. #### Permisionless listing Euler lets its users determine which assets are listed. Any asset that has a WETH pair on Uniswap v3 can be added as a lending market on Euler. #### Protected Collateral On Compound and Aave, collateral deposited to the protocol is always made available for lending. On the other hand, Euler allows collateral to be deposited, but not made available for lending. This collateral is 'protected'. It doesn't earn interest, but is free from the risks of borrowers defaulting, can always be withdrawn instantly, and helps protect against borrowers using tokens to influence governance decisions. #### Reactive interest rates Euler uses control theory to autonomously change the interest rates towards a level that maximises utilisation of assets in the protocol. These reactive interest rates adapt to market conditions for the asset in real-time without the need for ongoing governance intervention. #### Compound Interest Compound interest is accrued on Euler each second. This is different from other lending protocols, where interest is typically accrued every block. Earning interest per-second is generally expected to perform more predictably in the long-run, even if upgrades to Ethereum lead to changes in the average time between blocks. #### Feeless Flash Loans Euler only charges fees according to the time value of money, and from the blockchain's perspective flash loans are held for a duration of 0 seconds. Thus, they are entirely free on Euler (ignoring gas costs).

Gauntlet

Gauntlet is a platform offering financial modeling and simulation tools for the DeFi (Decentralized Finance) sector. It focuses on optimizing protocols, managing risks, and enhancing overall economic efficiency through quantitative finance techniques and data-driven insights. Gauntlet serves a wide range of clients within the DeFi ecosystem, including protocols, DAOs, and traditional financial institutions, helping them navigate economic complexities and achieve sustainable growth.

Lido

### What Lido is an open source tool and family of protocols that enables users to mint liquid staking tokens (sTokens) - These liquid staking tokens receive rewards from validation activities of writing data to the blockchain, but unlike their staked counterparts, are "unlocked" which means they can be used in other on-chain activities, like DeFi. Lido protocols let users stake native tokens (ETH, MATIC, SOL) from Ethereum, Polygon, and Solana networks in a fully permissionless way. And as the protocols are deployed on public blockchains, users do not need the website to access the smart contracts. ### Why Traditional staking means that users need to lock-up their ETH or other native asset to be able to secure the network and receive the respective rewards. However, this means that these tokens can't be used for anything else while they are staked. Lido aims to solve this problem. Lido protocols give users liquidity - users are able to receive staking rewards from validation activities, but can sell their stTokens (tokens minted on Lido) anytime they want to exit their staking position. In addition, it allows users to participate in DeFi while getting rewards - Because sTokens are unstaked and thus "liquid", users can use stTokens as building blocks in DeFi protocols at the same time as getting staking rewards from validating activities. The Lido DAO also works with experienced node operators, which decreases the likelihood of technical mistakes that could lead to slashing or penalties and minimizes the technical burden for users to receive staking rewards. Users supply the stake, and the node operators supply the know-how.

Morpho

Morpho Blue is a decentralized protocol enabling the overcollateralized lending and borrowing of crypto assets (ERC20 Tokens) on the Ethereum Virtual Machine. The protocol is implemented as an immutable smart contract, engineered to serve as a trustless base layer for lenders, borrowers, and applications. Morpho Blue is licensed under a dual license (BUSL-1.1 and GPLv2) which you can find [here](https://github.com/morpho-org/morpho-blue/blob/main/LICENSE). Once deployed, Morpho Blue will function in perpetuity, provided the existence of the Ethereum blockchain. ### Why Within a year, Morpho has become the third-largest lending platform on Ethereum, with over $1.5B in deposited assets. Morpho's initial version, Morpho Optimizer, operates on top of Compound and Aave to enhance the efficiency of their interest rate model. But consequently, Morpho Optimizer’s growth is constrained by the current underlying lending pool design. In particular, the current lending paradigm is: - Not Trustless: It relies heavily on its DAO and trusted contractors to monitor and update hundreds of risk parameters daily or upgrade large smart contracts. - Not Efficient: It provides inefficient rate spread, low collateralization factors, and charges fees to maintain the platform itself. - Not Flexible: It has a limited number of assets listed. Users have no choice but to subscribe to the one-size-fits-all risk-return profile proposed by the DAO. Although DeFi lending has grown rapidly under existing protocols like Aave and Compound, we need to rethink decentralized lending from the ground up to reach the next order of magnitude. Having spent two years developing the most significant platform built on top of these onchain funds, Morpho is uniquely positioned to recognize and address its limitations. As anticipated in the initial whitepaper, Morpho must metamorphose to become fully autonomous and improve the current state of DeFi lending. We call this evolution Morpho Blue 🟦.

odos

Odos is a decentralized exchange aggregator that optimizes order routing across multiple blockchain protocols, accessing over 700 liquidity sources and thousands of token pairs. It uses a proprietary algorithm for Smart Order Routing (SOR) to find the most efficient paths for swaps, ensuring users get the best rates while maintaining self-custody and security. Odos stands out by allowing atomic multi-token swaps in a single transaction, aiming to save on gas costs and reduce market impact for its users.

Redacted

The Redacted ecosystem is a product suite of smart contracts empowering on-chain liquidity, governance, and cash flow for DeFi protocols. We've built two products inline with this mission: Hidden Hand and Pirex — with more in research and development. The Redacted protocol is the dApp centered around BTRFLY, which allows users to stake, earn incentives, and interact with governance proposals. The Redacted Cartel is the DAO building out the Redacted ecosystem. The DAO consists of developers, writers, researchers, and more who are all focused on building out Redacted and extending its reach in DeFi.

People

Articles