Liquidity Markets
Supply-Side
Users who access protocols/service providers through Curvance's front-end/smart contracts and supply assets to borrowers will receive the interest paid by borrowers. User deposits into those smart contracts can be (in most cases, depending on the market) collateralized and borrowed against. Assets supplied on the lending side cannot be borrowed against. Generally, things like stablecoins can be deposited on the lending side, while so-called "long-tail" assets like LP tokens and liquid wrappers can only be used as collateral.
Yield on deposits is influenced by:
The yield of the underlying assets in the case of LP tokens or liquid wrappers.
The borrow demand.
New pool tokens can be added at the discretion of the Curvance DAO.
Users who deposit tokens into the protocol as lenders will receive a dToken (debt token) minted from the Curvance protocol. This token represents the lender's proportionate contribution to the lending pool needed to redeem their deposit.
Earned interest is automatically compounded into the users’ position.
Key Characteristics:
Using yield-bearing assets as collateral eliminates the need to sell them while preserving exposure to the yield those assets can generate.
Accessing leveraged loans from Lenders in the peer-to-peer markets amplifies the borrowing users’ exposure to the collateral asset, thereby increasing potential yields. However, this also increases liquidation risk.
Ensuring the users’ capital remains productive by generating yield while capitalizing on additional growth opportunities.
Demand-Side
Collateral
Long-tail assets deposited to the Curvance protocol automatically generate the maximum yield through yield optimization. The user can opt to enable the deposited assets as collateral in isolated or cross-margin markets to unlock the ability to borrow against them from Lenders.
Assets are also supported, such as Liquid Staking Derivatives or interest-bearing stablecoins that do not need to be compounded.
Whitelisting Collateral
Go to the main dashboard, where all supplied assets are located.
Find the assets you have supplied.
Flip the switch to enable the desired assets as collateral.
Remember: The corresponding ERC-4626 vault will redirect the assets back into their underlying protocols in order to earn optimized yield.
Last updated