2021-11-25 20:09 |
Alfprotocol, a leveraged liquidity provision and yield farming dApp plans to utilize the Solana blockchain to expand its services to an unparalleled range of up to 20 times. Solana was the network of choice as it boasts of high speed of up to 50,000 transactions per second (TPS).
With the conceptualization and actualization of decentralized markets, automated market makers (AMMs) are rising in popularity in the crypto community. Additionally, the past two years have seen an increased demand for alternatives for centralized exchanges. This has come about due to the introduction of “Know Your Customer” (KYC) regulations, on top of the Securities and Exchange Commission’s (SEC) growing interest in cryptocurrencies and crypto exchanges.
These alternatives – decentralized exchanges (DEXs), have seen massive surges in the number of clients they cater to. With the increase has come the need for additional diversified products and services to cater to the interests of all customers.
Alfprotocol plans to look out for capital deployment between traders and investors. This will maximize the liquidity provision (LP) for its DEX platform AlfMM, and its over-collateralized borrowing service AAlf, for unleveraged liquidity. It will also provide leveraged liquidity through external protocols handled by one of Alfprotocol’s projects.
Of importance, Alfprotocol features several modules that work jointly to provide a complete intermediary product that facilitates liquidity provision.
The first is the treasury, which is responsible for collateral and tracking of leveraged positions. This module will underlie interactions between users and the leverage protocol. It will also handle borrowed funds on users’ behalf.
The second module, the action module, will handle the liquidation of unhealthy positions. This module is triggered by the treasury module.
Another suite of modules is referred to as protocol connectors since they initiate and modify positions triggered by the first module. As the name suggests, these modules connect users with the treasury in addition to external liquidity pools. The conditions for this connection are healthy positions that are not subject to a liquidation trigger. Alfprotocol plans to create additional connector modules and expand them to other Solana platforms. Such a move will increase the protocol’s use cases and cater to user diverse needs.
Last but not least, is the lockbox module. This module secures collateral and tracks the value of positions. A lockbox module is automatically created for leveraged user positions by instigating a wrapper on the deposited tokens, in order to make them part of the Alfprotocol.
With all these extensive features, Alfprotocol brings users numerous advantages including high leverage liquidity and solutions for decentralized market traders and investors of the Solana network.
Currently, Alfprotocol is in its development phase. Additional information about the dApp is available on its website and whitepaper.
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