๐Ÿงจ The problem we are solving

Defi is currently a $200bn+ market with triple digit annual growth. In the current state however, risk management systems tend to be either capital inefficient or altogether ineffective. Hacks remain an everyday story, undermining the credibility of the overall system and preventing potential capital from flowing in.

๐Ÿ’ก How we are solving the problem uniquely

The Vyper protocol will bring tranching, a tradFi risk management concept, to DeFi.

To make a simple example: Alice and Bob both deposit $50 to a lending protocol. Alice gives up part of the interest generated but Bobโ€™s capital is impacted first if any hack/default happens. We would refer to Alice as having a senior tranche (less risk, less yield), and to Bob as having a junior tranche (more risk, more yield). This simple yet effective concept is at the base of a $10tn market in tradFi.

Vyper manages the creation and redemption of tranches, and deployment of locked funds. By integrating with new and existing protocols Vyper will create entire innovative products and protocols. Vyper is unique in bringing tranching to DeFi while at the same time taking a modular approach, enabling composability.

Vyper is currently leveraging Serumโ€™s CLOB, automatically creating markets for tranches and unlocking liquidity of positions. Other examples of integrations include:

  1. Lending protocols (Solend, Port, Jet..), as destination for tranched funds
  2. Bridging protocols (Wormhole), to allow deployment of tranched funds across chains
  3. Structured products, to offer optimised vaults which can be in the form of enhanced/protected deposits or even farming, to hedge impairment loss, and staking
  4. Yield optimizers, to allow for enhanced and risk-effective deployment of funds

๐Ÿ—๏ธ Examples of application leveraging composability

Vyper is built with composability at its core to unlock new use cases and solutions. We built a conceptual application layer: Vyper Vaults. With a similar UX as existing structured products protocols, users can deposit safely in lending protocols giving up some yield, while others earn extra yield by providing a capital buffer. This is all conveniently managed by Vyper, including auto-compounding and funds deployment.

Other application layers include:

  1. Hedged yield farming
  2. Lending protocols based on direct tranching (without the need to rely on expensive liquidation penalties to incentivize liquidation bots)
  3. Tranching of NFT-collateralized lending
  4. Insured yield-generating stablecoins (mitigating depeg risk due to counterparty defaults)

๐ŸŒŽ Our roadmap

  • Q1-22: hackathon, Devnet deployment with lending protocols integration (Port, Jet and Solend)
  • Q2-22: code audit and mainnet launch, first application layer: Vyper Vaults
  • Q3-22: integration with bridging (Wormhole) and yield farming protocols (Orca and Raydium)
  • Q4-22: ecosystem grants and further development of applications

follow our journey or say hi ๐Ÿ‘‹ : https://twitter.com/VyperProtocol

Built With

+ 8 more
Share this project:

Updates