How Is Radiant V2 Bringing Borrowing & Lending Omnichain?
ARB Airdrop | Breaking Down Chainlink | Trader Joe x RDNT
GM Intels, this is your Daily Bolt briefing.
In today’s news: the Arbitrum airdrop claim recently went live, and the ARB token has begun trading. The high demand has resulted in network and Arbitrum website congestion for many users.
In today’s edition, we have provided a preview of our most recent project breakdown to be accessible for Free members: Chainlink.
While this breakdown report was available for premium users last month, free users can now also access the our research in it’s entirety.
Later, learn how Radiant Capital is building the 1st omnichain borrowing and lending market with RDNT V2, on top of LayerZero technology.
Over and out.
Breaking Down Chainlink
Brief Overview: Chainlink is a Decentralized Oracle Network (DON) that enables the secure connection between on-chain smart contracts and off-chain data providers and services. Chainlink’s infrastructure has set an industry standard for decentralized oracle networks.
Here are some key takeaways from our report:
LINK Token
There is a fixed supply of 1 Billion tokens:
35% for ICO
35% for node operators
30% for the team and future development
Business Model
Chainlink’s economic model revolves around the widespread use of the LINK token, which is mostly used to pay for the operation of the oracle services it can provide (data feeds, VRF, proof of reserves…).
The supply side of Chainlink economics involves launching new oracle services as well as continuing to improve the existing ones in order to further the adoption of hybrid smart contracts.
On the demand side, users pay node operators in LINK tokens to access oracle services. With the introduction of staking, both node operators and users will also be able to stake LINK as a form of service-level guarantee around oracle performance.
Revenue Streams
Chainlink’s main source of revenue is through node operator fees where LINK tokens are paid to Chainlink nodes to obtain access to real-world data and oracle services.
Chainlink did more than $6.9T USD in Transactional Value Enabled (TVE) in 2022.
In comparison, it only did more than $75B TVE in 2021. (TVE is the sum of all transactions enabled by a protocol.)
Chainlink BUILD program
The Chainlink BUILD Program is an initiative by Chainlink Labs to accelerate the growth of early-stage and established projects within the Chainlink ecosystem.
This will be achieved by providing enhanced access to Chainlink services as well as technical support in exchange for commitments of fees and other incentives that will be distributed to Chainlink service providers (and stakers).
As an example, Aave joined the Chainlink ecosystem during its pre-launch days and received technical support for integrating Chainlink price feeds.
Operating Expenses
There is increasing adoption of oracle services, and Chainlink is currently preparing to witness an economy of scale that, in an ideal scenario, will be followed by a significant decline in operating costs.
The costs for providing decentralized oracle network services peaked in 2022 after the release of Off-chain Reporting (OCR).
Since then, the network has scaled by improving its service offerings with OCR (Off-chain reporting) and VRF v2.
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Note of the Day
Trader Joe Twitter space - Radiant Capital V2 Upgrade
In this Twitter space, Blue and DavideFi are joined by Isaac to talk about Radiant V2, $RDNT, omni-chain, liquidity fragmentation and more.
Read our notes below to learn more.
About Isaac
Director of PR and project management of Radiant Capital.
Worked as an engineer and an entrepreneur in the past.
Radiant V2
They are building the first true omni-chain borrowing and lending market.
Omni-chain fixes the problem of liquidity fragmentation.
They changed the tokenomics and the protocol mechanics.
They started on Arbitrum and will be launching shortly on Binance Smart Chain.
They will expand on more chains in the future.
Users can deposit on one chain and borrow on another chain.
They want to reward their users with incentives and boost emissions for everyone.
$RDNT is their official governance token.
Only users with locked Dynamic Liquidity activate eligibility to receive $RDNT emissions within the money market.
Alternatively, emissions may be vested for three months.
Vesting $RDNT may be claimed early for an exit penalty to receive 10-75% of rewards, decaying linearly during the three-month vesting period.
This penalty fee is distributed 90% to the Radiant DAO reserve and the remaining 10% is sent to the Radiant Starfleet Treasury.
The protocol fees come in the form of hard assets like $BTC, $ETH and stablecoins.
Whenever a user locks their assets that are more than 5% of their total deposits, they also start getting a boost on $RDNT emissions.
Ultra-compounding will allow compounding protocol fees that users get to earn more yields.
Vertical locking will allow users to earn more protocol fees the longer they lock their assets.
Zapping is a one-click feature for users to do activities within the protocol.
$RDNT is also an OFT token which means it is an omni-chain fungible token.
Mission
They want to build a robust protocol that will last for the long term.
They believe that omni-chain is the future.
Omni-chain will help onboard the next hundred million users without requiring to know the tech that’s under the hood.
Why use LayerZero?
LayerZero is a messaging technology from chain A to chain B as opposed to traditional bridges.
Multichain is bridging one asset from one chain to another which requires the use of bridges.
Omni-chain doesn’t require the use of bridges.
BSC Deployment
Given that BSC has around $6B worth of liquidity, the foundation proposed that it will be the chain they will launch on after Arbitrum.
They plan to encourage the DAO to launch on 5 top EVM chains and then the rest of the chains in the future.
Partnership with Trader Joe
They will provide liquidity to Trader Joe.
They can use the liquidity book.
Their community is interested in the looping function that allows users to loop their assets on the platform to increase the amount of leverage they have.
Users want to trade the protocol fees they get from the platform.
Radiant can offer more arbitrage opportunities and complex strategies.
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Revamped Protocol
One of the mistakes they made was offering large amounts of yield that attracted mercenary capital and hoping that the TVL generated by that would sustain the protocol.
They found out that the emission scheme that they had in the beginning was too inflationary.
The emissions are cut in half in the v2.
They have extended the runway of the protocol to 5 years.
They changed from single-sided staking to dynamic liquidity which increases the liquidity in the protocol.
They want to go with 20+ collateral types.
The risk committee will propose the risk parameters of the assets to be added in the money markets.
The new assets that will be listed on Radiant will only be allowed as collateral types and will not receive any emissions in the beginning.
Alpha
The $ARB token that will be airdropped will be available to be used as a collateral but it will still go through the risk committee process of proposing and voting.
Q&A
Q: What do you think will be the outlook of Radiant Capital in the next 6 to 24 months to come?
BSC launch and 5 EVM chains.
Adding 20+ assets as collateral.
Offering more services aside from being a money market protocol like utilizing NFTs to be used on the platform.
Having credit scores to improve the LTV on assets.
Q: Where do emissions get allocated?
The APY on the lending and borrowing side is the base APY for user deposits.
The protocol fees are generated by the borrowers.
25% of the protocol fees go to the lenders and 65% goes to the dynamic liquidity lockers.
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