GM, this is your Daily Bolt briefing.
In this Sunday edition, we’ll be giving you some updates on a couple of interesting developments in the DeFi ecosystem:
Raft discusses their new R-DAI pool on balancer, increasing collateral ratio, and more.
f(x) Protocol discusses their ETH-backed stablecoin fETH, as well as their leveraged ETH exposure token, xETH.
Stay Vigilant⬇️
1/ Balancer Twitter Spaces - Balancer | Raft
Preview: In this Twitter Space hosted by Balancer, solarcurve from Balancer is joined by David Garai from Raft to discuss Raft’s stablecoin $R, how Raft works, their decision to launch $R-$DAI pool on Balancer, future plans for Raft, and more! Click here to listen to the full episode (51 mins).
Read our Note (9 mins) and save 42 mins.
Here are some key takeaways:
Balancer is a decentralized AMM protocol built on Ethereum that represents a flexible building block for programmable liquidity.
Raft –is an immutable and decentralized lending protocol where users can take out USD-denominated loans against their staked ETH.
David Garai mentions that he has previous exposure to Balancer tech and the Balancer team through a different project of his, Tempus Fixed Income.
David explains that Raft was inspired by the surge in the Liquid Staking Derivatives (LSD) area of DeFi, the rise in TVL in protocols like Lido, and the absence of a satisfactory solution to borrow against staked coins. Raft aims to combine two use cases: creating a decentralized stablecoin (R ) backed by censorship-resistant collateral ( stETH) and allowing people to leverage up on their staking in a capital-efficient way.
The Raft protocol works by allowing people to lock in yield-bearing collateral (stETH), against which they can mint R (Raft's native stablecoin). This allows minters and borrowers to retain all staking yields from their collateral. In the background, the protocol helps users leverage up on their $stETH in a capital-efficient way by depositing their collateral, borrowing against it at a 120% Collateralization Ratio (CR), and swapping the borrowed $R back to $stETH.
Raft is developing a feature called "one-step leverage" to simplify the process of leverage staking. Instead of manually handling transactions, users will be able to leverage in a single transaction by depositing $stETH and choosing their desired leverage level. The transaction will then use a flash mint and be routed through a Balancer $R-$DAI pool automatically using yield aggregators.
David Garai mentions that they increased the collateralization ratio by 10% (110% to 120% CR) to prevent market manipulation scenarios. They aim to control risk, especially since they are experimenting with a new type of collateral yield-bearing and developing a suitable fee structure.
2/ blocmates - Introduction to f(x) Protocol, $fETH, $xETH and $FX
Preview: In this episode of blocmates, Grant from blocmates, Subli and Kmets from Aladdin DAO discuss f(x) Protocol, the tokens offered by f(x) Protocol, integration of f(x) Protocol with DeFi ecosystem and more. Click here to listen to the full episode (53 mins).
Read our Note (5 mins) and save 48 mins.
Here are some key takeaways:
f(x) Protocol is a protocol that creates a new class of decentralized low-volatility asset paired with a new leveraged long ETH perpetual token.
Subli adds that fETH is a stablecoin that is minted by depositing $ETH. Unlike other stablecoins that are pegged to fiat currencies like the US dollar, $fETH is designed to be less susceptible to market volatility and the uncertainties of other stablecoins.
Kmets says that xETH is a token that provides leveraged exposure to the price of ETH.
He adds that it's designed for traders who are bullish on ETH in the long term. It provides leverage and can be used as a high beta token, meaning it's expected to outperform the market in bullish conditions but may underperform in bearish conditions.
Subli says that the f(x) Protocol plans to establish liquidity pools on existing DeFi platforms like Curve and Balancer. He adds that by setting up liquidity pools, the f(x) Protocol ensures that its tokens, fETH, and xETH, can be traded easily, thereby increasing their utility in the DeFi space.
Subli says that the team behind the f(x) Protocol is also considering layer-2 solutions for scalability.
Kmets says that Aladdin DAO is a decentralized autonomous organization (DAO) that plays a significant role in the development of the f(x) Protocol.
Kmets adds that in the context of the f(x) Protocol, Aladdin DAO appears to function as a problem-solving entity. He says that it identifies problems in the DeFi space and tries to come up with novel solutions. He believes that this proactive approach to problem-solving is crucial in the rapidly evolving DeFi landscape, where new challenges and opportunities arise frequently.
Subli says that the f(x) Protocol is launching a booster program where users can contribute to the project by delivering content in any language.
Subli says that participants in the booster program are rewarded for their contributions with a monthly airdrop of FX tokens.
Kmets says that f(x) Protocol is set to go live on a testnet called Sepolia. He says that two weeks after the testnet launch, the f(x) Protocol is scheduled to go live on the mainnet.
Kmets adds that alongside the mainnet launch, the f(x) Protocol will also have the second round of its bootstrapping Initial DEX Offering (IDO) token offering. In this case, users will have the opportunity to purchase $FX tokens, potentially at a lower price than they will be once the token is fully trading on the open market.