In this edition, we’re briefing you on Timeless Finance.
Not to be confused with $TIME, Wonderland, which saw significant volatility yesterday, Timeless Finance consists of two protocols:
Timeless Finance - a yield tokenization protocol where the yield tokens never expire
Bunni - a liquidity engine for incentivizing Uniswap v3 liquidity
Learn how the project is innovating with Bunni V2, and more.
Stay alert, stay informed ⬇
Crypto Market Update:
- Top Gainer (24H) in the top 50 mcap: Bittensor $TAO 0.00%↑increased in price by 16.9%.
- Top Loser (24H) in the top 50 mcap: Kaspa $KAS is down -13.4%.
- The total crypto market cap has seen a decrease by 1.1% to stand at $1.35T.
- BTC dominance in the market is currently at 52.8%.
- The median gas price on Ethereum over the past 24 hours has been 35 gwei.
News:
- Binance Faces $4B DOJ Settlement: The U.S. Department of Justice may demand over $4 billion from Binance to settle accusations of criminal violations, with potential charges against founder CZ Zhao.
- Kronos Research Hacked for $25M: Taipei-based Kronos Research faced a security breach with an estimated loss of $25 million after attackers accessed its API keys.
- Javier Milei Elected Argentina's President: With a significant lead in votes, Javier Milei is set to become Argentina's next president, as confirmed by his opponent Sergio Massa. Read More
Timeless Finance: DeFi Evolution and Strategies
The team behind Timeless originally worked at 88mph, a fixed rate protocol, and learned valuable lessons about liquidity management.
The members then transitioned to Timeless, a variable rate protocol to address liquidity issues.
Unexpected challenge included handling large investments from a few whales early on.
The creation of Bunni was a response to liquidity challenges.
It was designed to work atop Uniswap, filling a gap in the market.
Timeless V2 will have a soft launch, with the full version coming later, enhanced by the Bunni liquidity engine.
This positions Timeless favorably compared to its initial version.
There are both challenges and opportunities presented by launching in a bear market; it exposes problems early and prepares teams for future bull markets.
Timeless's process, involves a staked yield-bearing token which is deposited, resulting in the issuance of a Positive Yield Token (PYT) and a Negative Yield Token (NYT).
Timeless's process, involves a staked yield-bearing token which is deposited, resulting in the issuance of a Positive Yield Token (PYT) and a Negative Yield Token (NYT).
This splits the original token into two, allowing for leveraged positions without the risk of expiration or liquidation.
PYT increases with the yield of the underlying asset, while NYT does the opposite, allowing users to either hedge or speculate on the yield of their underlying asset.
PYT offers leverage on the yield.
NYT can be used for hedging, especially in scenarios like borrowing on platforms like Aave.
There are practical applications of Timeless's tokens, for example, $USDC's yield fluctuation on Aave and how NYT and PYT can be used to speculate or hedge in such scenarios.
Dakotah, Lead of Growth at Timeless Finance, distinguishes Timeless from Pendle, noting the difference in their approach to fixed versus variable rates.
He explains that Timeless's variable rate approach benefits both speculators and hedgers, as it avoids issues like liquidation and expiration that are typical in fixed-rate models.
Dakotah expects the launch of Timeless V2, discussing the support for magic GLP vault and $sFRAX pool, highlighting their appeal to different types of investors.
The team is in discussions with projects in the ve ecosystem, highlighting the predictive nature of their model.
The strategy of utilizing high initial APYs to drive demand, relates it to market dynamics and traditional finance interest rates.
There are constraints for vaults on Timeless: they cannot have negative returns, nor can they have withdrawal or deposit fees.
Additionally, they must adhere to a specific ERC-4626 standard, with adaptations available for Aave and Yearn V2 products.
On Timeless, it's permissionless to create a yield market using the factory page, highlighting the openness for anyone to establish a market.
Chainlink: Path to 1 Trillion Marketcap?
Our CEO, Nick Drakon, recently had on ChainLinkGod to discuss the path to Chainlink potentially becoming a Trillion-dollar asset. The two discuss the bull case for $LINK, and dive into new products and services being rolled out.
Exploring Liquidity & Market Trends With Timeless & Bunni
Bunni, is part of the Timeless ecosystem, built on Uniswap V3.; it facilitates liquidity for token pairs on Timeless, with governance proposals required for pool inclusion.
The governance token veLIT incentivizes holders to vote for certain pools, directing emissions and offering rewards, including high APYs, for liquidity providers.
Dakotah expects to see developments on Optimism, mentioning the slow adoption rate of the ERC-4626 standard but expressing optimism about its future integration with platforms like Timeless and Bunni.
Dakotah has also discussed the potential of partnering with projects like Popcorn, which use the ERC-4626 standard, to facilitate the integration of LSD-related vaults into Timeless.
Dakotah acknowledges the effectiveness of Bunni, mentioning its recent involvement in the Aave stablecoin GHO peg situation, where Bunni is being used to direct liquidity effectively.
He says that stablecoin projects and LSD projects are major advocates of Bunni, either through governance tokens or incentivization.
Dakotah also discussed the utility of indicator tools in yield markets.
He says that Timeless V2 will feature a forward-looking indicator showing the market's implied yield based on current PYT prices.
This tool is expected to be valuable in understanding market expectations and making strategic decisions.
Dakotah speculates that in a bull market, long-tail assets, especially those related to borrowing, might become more prominent.
Behaviors like borrowing on platforms like Aave could increase borrowing costs, while those staking assets like Ethereum might become more aggressive and shift their strategies.
He highlights the value of observing PYTs and NYTs prices in Timeless.
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