diff --git a/governance/governance-overview.md b/governance/governance-overview.md index 2052cae..f75284c 100644 --- a/governance/governance-overview.md +++ b/governance/governance-overview.md @@ -1,4 +1,3 @@ # Governance Overview -The OptyFi Protocol is a decentralized system owned and governed by the [OptyFi DAO](optyfi-dao.md) whose members are the community of [OPTY](../opty/opty-governance-token.md) token holders. All major decisions regarding the Protocol are made by the governance through a [voting process](voting.md#voting-process). Governance may elect to delegate the implementation of decisions and operational duties, and has the right to select/remove [Operators](operators.md) for this purpose. - +The OptyFi Protocol is a decentralized system owned and governed by the [OptyFi DAO](optyfi-dao.md), whose members are the community of [OPTY](../opty/opty-governance-token.md) token holders. All major decisions regarding the Protocol are made by the governance through a [voting process](voting.md#voting-process). The governance may elect to delegate the implementation of decisions and operational duties, and has the right to select/remove [Operators](operators.md) for this purpose. diff --git a/governance/operators.md b/governance/operators.md index 62c473c..758bd2a 100644 --- a/governance/operators.md +++ b/governance/operators.md @@ -4,7 +4,7 @@ For practical purposes, Governance shall delegate the implementation of Governance decisions and daily operational duties to Operators \(who may be individuals, corporate entities or decentralized organizations\). -There will be several Operators who may further sub-delegate duties but will remain responsible to Governance for these sub-delegated duties. They include the following: +There will be several Operators who may further sub-delegate duties while retaining responsibility over these. An overview of operations and duties is given here. ### Operator @@ -41,5 +41,4 @@ The Risk Operator will be responsible for the following duties: ## **Selection and Replacement** -The Operators will be selected by Governance for a one year term through a normal proposal. During the term of the Operators, Governance may remove and replace any or all of them through a critical proposal. - +The Operators will be selected by Governance for a one year term through a [normal proposal](voting.md#issues-by-proposal-category). During the term of the Operators, Governance may remove and replace any or all of them through a critical proposal. diff --git a/governance/optyfi-dao.md b/governance/optyfi-dao.md index 497fa99..1613427 100644 --- a/governance/optyfi-dao.md +++ b/governance/optyfi-dao.md @@ -1,10 +1,9 @@ # OptyFi DAO -The OptyFi Protocol is a decentralized application owned and governed by a decentralized autonomous organization \(the “OptyFi DAO”\) whose members are the holders of the Protocol’s native OPTY token. OptyFi DAO members \(aka “Governance”\) are entitled to make all major decisions regarding the development and operation of the Protocol. +The OptyFi Protocol is a decentralized application owned and governed by a decentralized autonomous organization \(the “OptyFi DAO”\), whose members are the holders of the Protocol’s native OPTY token. OptyFi DAO members \(aka “Governance”\) are entitled to make all major decisions regarding the development and operation of the Protocol. -This document proposes an initial Governance System for the DAO including mechanisms for self-amendment under Governance authority. Upon launch of the Protocol and the initial OPTY token distribution event, Governance may choose to accept or amend this Governance System or implement a completely different governing model. +This document proposes an initial Governance system for the DAO including mechanisms for self-amendment under Governance authority. Upon launch of the Protocol and the initial OPTY token distribution event, Governance may choose to accept or amend this Governance system or implement a completely different governing model. ### Delegation While Governance is entitled to make all major decisions regarding the development and operation of the Protocol, from a practical stand-point it is recognized that Governance may need to delegate responsibility for implementing \(some of\) these decisions and for performing daily operational duties. Specifically, Governance will delegate [Operators](operators.md) to implement Governance decisions and to operate the Protocol under guidelines determined by Governance. - diff --git a/governance/treasury.md b/governance/treasury.md index 258891a..dd2f4f1 100644 --- a/governance/treasury.md +++ b/governance/treasury.md @@ -1,6 +1,6 @@ # Treasury -The protocol shall maintain one or more treasury accounts. Treasury funds usage will be decided by Governance. +The Protocol shall maintain one or more treasury accounts. Treasury funds usage will be decided by Governance. \(Further details to be added\). diff --git a/governance/voting.md b/governance/voting.md index 1f21a16..781615f 100644 --- a/governance/voting.md +++ b/governance/voting.md @@ -6,12 +6,12 @@ Governance will participate in decision making through a proposal voting process 1. **Discussions**: The community may carry on discussions in the OptyFi Forums, including in the “Possible Proposals” section. 2. **"OIP" Proposal Creation**: If a particular discussion attracts significant interest, the Operator may create a formal OptyFi Improvement Proposal \(OIP\). -3. **OPTY Staking**: In order to participate in voting, OPTY holders will need to stake their OPTY. The length of time for which OPTY tokens are locked in the staking pools, will determine the [voting power](voting.md#voting-power) of the OPTY. +3. **OPTY Staking**: In order to participate in voting, OPTY holders will need to stake their OPTY. The length of time for which OPTY tokens are locked in the staking pools will determine the [voting power](voting.md#voting-power) of the OPTY. 4. **Voting**: Each OIP will be set to a Governance vote. Voting rules will be determined by the [proposal category](voting.md#issues-by-proposal-category). ## Voting Power -| Staking Pool Lock-In Period | Voting Power | +| **Staking Pool Lock-In Period** | **Voting Power** | | :--- | :--- | | None | 1 OPTY - 1 Vote | | 3 Months | 1 OPTY - 2 Votes | @@ -20,7 +20,7 @@ Governance will participate in decision making through a proposal voting process ## Voting Rules -| Proposal Category | Approval Threshold | Quorum | +| **Proposal Category** | **Approval Threshold** | **Quorum** | | :--- | :--- | :--- | | Normal | 50% | 5% | | Critical | 75% | 5% | @@ -30,8 +30,8 @@ Governance will participate in decision making through a proposal voting process - - + + diff --git a/intro/how-optyfi-works.md b/intro/how-optyfi-works.md index a18e522..a152de9 100644 --- a/intro/how-optyfi-works.md +++ b/intro/how-optyfi-works.md @@ -5,12 +5,12 @@ The OptyFi Protocol continuously monitors DeFi activity, predicting the yield of The yield optimization model proceeds as follows: 1. **Dynamic Strategy Generation:** Strategies are dynamically composed based on the integrated protocols and blockchains. -2. **Optimization Engine:** Constantly monitors changing conditions across DeFi pools and scores the universe of possible strategies. +2. **Optimization Engine:** DeFi pools are constantly monitored, where the plethora of possible strategies are evaluated according to changing conditions. 3. **Strategy Execution Engine:** Smart contracts can execute any valid yield strategy \(across integrated protocols/blockchains\) while enforcing risk constraints. 4. **Automated Vaults:** Vault assets are automatically and continuously routed to the most optimal strategy. 5. **Modular Design:** Specialist vaults optimize a single type of asset providing optimal yield for a specific risk level. Portfolio vaults allocate assets across specialist vaults, diversifying risk and providing optimal asset allocation. ![OptyFi vault assets will be routed across multiple pools and protocols in real time.](../.gitbook/assets/how-it-works.svg) -Capital never stays idle with OptyFi. +By combining these elements into a working application, OptyFi ensures capital never remains idle. diff --git a/intro/join-the-community.md b/intro/join-the-community.md index be8b40d..9cf925d 100644 --- a/intro/join-the-community.md +++ b/intro/join-the-community.md @@ -2,17 +2,17 @@ The best way to get involved with OptyFi is to join our growing community of builders and users committed to risk-adjusted capital efficiency in DeFi. You can start by joining one or more of our community channels. -### [Forum](https://forum.opty.fi) +### [Discord](https://discord.gg/kVxKHUEpy8) -Join our forum for discussions on product development, feature requests, OPTY tokenomics, and other topics. +This is our most active community channel and the best place to learn and contribute to OptyFi. -### [Discord](https://discord.gg/kVxKHUEpy8) +### [Forum](https://forum.opty.fi) -This is our most active community channel and where you can learn and contribute the most to OptyFi. +Discuss product development, feature requests, OPTY tokenomics, and other topics by joining our Forum. ### [Twitter](https://twitter.com/optyfi) -Follow us on Twitter for announcements and updates. +Be the first to hear about announcements and updates by following us on Twitter. ### [Medium](https://medium.com/optyfi) @@ -21,4 +21,3 @@ Enjoy and stay up-to-date with our in-house research and content by following ou ### [GitHub](https://github.com/opty-fi) Review and contribute to our open-source code repository on GitHub. - diff --git a/intro/welcome-to-optyfi.md b/intro/welcome-to-optyfi.md index 3a458bf..e2a2e50 100644 --- a/intro/welcome-to-optyfi.md +++ b/intro/welcome-to-optyfi.md @@ -2,7 +2,7 @@ The OptyFi Protocol provides simplified access to optimized yield across DeFi. -The Protocol ****evaluates thousands of yield strategies across hundreds of liquidity pools, dozens of protocols and multiple blockchains. OptyFi optimizes capital as assets deposited into vaults are continuously deployed into the most profitable strategies based on predefined risk profiles and preferences. +The Protocol evaluates thousands of yield strategies across hundreds of liquidity pools, dozens of protocols and multiple blockchains. OptyFi optimizies capital investment gains by continuously deploying the assets deposited in the OptyFi vaults into the most profitable strategies. Strategies are determined based on predefined risk profiles and preferences. This document aims to provide an overview of OptyFi including: diff --git a/intro/why-optyfi.md b/intro/why-optyfi.md index a9058e7..3a6c5b0 100644 --- a/intro/why-optyfi.md +++ b/intro/why-optyfi.md @@ -4,7 +4,7 @@ Yield was the "killer application" that brought DeFi to the world's attention. But we are still at a very early stage. -The current status of DeFi yield consists of fragmented yield aggregation apps with hand-picked and inflexible yield strategies. Until DeFi is able to offer a user experience and technical sophistication comparable to TradFi, we will not achieve mainstream \(retail or institutional\) adoption. +The current status of DeFi yield consists of fragmented yield aggregation apps with hand-picked and inflexible yield strategies. Until DeFi is able to offer a user experience and technical sophistication comparable to TradFi, mainstream adoption \(retail or institutional\) will not be achieved. OptyFi aims to deliver the user experience and technical sophistication of traditional asset management while preserving the ground-breaking advantages of decentralization. diff --git a/opty/adaptive-user-rewards-distribution.md b/opty/adaptive-user-rewards-distribution.md index 36a3b88..aea2109 100644 --- a/opty/adaptive-user-rewards-distribution.md +++ b/opty/adaptive-user-rewards-distribution.md @@ -2,7 +2,7 @@ ### **Asset Growth vs. OPTY Price** -Liquidity mining will distribute OPTY to incentivize users to retain assets in OptyFi vaults. Increased assets should increase the Protocol's value by expanding revenue base and realizing economic efficiencies of scale. However, excessive OPTY distribution can have a depressing effect on OPTY price, reducing the Protocol's market cap directly and also weakening the Protocol's ability to incentivize users and contributors. Thus, a balance needs to be struck between stimulating Protocol growth and supporting OPTY price. +Liquidity mining will distribute OPTY to incentivize users to retain assets in OptyFi vaults. Increased assets should increase the Protocol's value by expanding the revenue base and realizing economic efficiencies of scale. However, excessive OPTY distribution can have a depressing effect on OPTY price, reducing the Protocol's market cap directly and also weakening the Protocol's ability to incentivize users and contributors. Thus, a balance needs to be struck between stimulating Protocol growth and supporting OPTY price. ### **Optimization Parameters** @@ -12,7 +12,7 @@ Instead of attempting to predict the optimal distribution rate, the Protocol wil * **Reward Rate**: The rate at which User Reward tokens are issued globally across all vaults and staking pools. -| Reward Rate | OPTY Per Day | Depletion Time | +| **Reward Rate** | **OPTY Per Day** | **Depletion Time** | | :--- | :--- | :--- | | 0x | 0; Distribution Paused | Infinity | | 1x | 50MM / 365\*5 = 27,397 | 5 Years | @@ -25,7 +25,7 @@ Instead of attempting to predict the optimal distribution rate, the Protocol wil ### Community Analysis -The precise relationships between growth, value and price are not easy to determine and at the outset we will not have data to estimate these relationships. It is hoped that the community will undertake data driven analysis to inform Governance in deciding the values for above parameters. +The precise relationships between growth, value and price are not easy to determine during the early days of the Protocol. As more data becomes available, community driven data analyses will inform Governance on deciding the optimal values for above parameters. For example, periodic \(e.g. weekly\) analysis could include the following data for the period: diff --git a/opty/liquidity-mining-and-staking.md b/opty/liquidity-mining-and-staking.md index 8acc096..5741b69 100644 --- a/opty/liquidity-mining-and-staking.md +++ b/opty/liquidity-mining-and-staking.md @@ -1,10 +1,7 @@ # Liquidity Mining and Staking -To incentivize users to deposit and retain assets with OptyFi, the liquidity mining program will distribute OPTY tokens to OptyFi vaults, providing vault depositors with enhanced returns. +To incentivize users to deposit and retain assets with OptyFi, the liquidity mining program will distribute OPTY tokens to OptyFi vaults, further providing vault depositors with enhanced returns. -OPTY holders will be incentivized to stake OPTY into staking pools in order to earn more OPTY. There will be multiple staking pools each with a different "lock-in" period. Users who deposit into pools with longer lock-in periods, will receive a higher rate of return on their OPTY. +OPTY holders will be incentivized to stake OPTY into staking pools in order to earn more OPTY. There will be multiple staking pools featuring different "lock-in" periods. Pools with longer lock-in periods will return a higher rate of return on deposited OPTY than pools with shorter lock-in periods. Additionally, as the OptyFi Protocol and community grows, new liquidity mining and staking mechanisms might be introduced. - -~~~~ - diff --git a/opty/opty-governance-token.md b/opty/opty-governance-token.md index 6c41a52..591dd2a 100644 --- a/opty/opty-governance-token.md +++ b/opty/opty-governance-token.md @@ -4,8 +4,7 @@ OPTY is the governance token for the OptyFi Protocol and OptyFi DAO. It derives The value of the OptyFi Protocol, and therefore the OPTY token, will be increased in the following ways: -1. \*\*\*\*[**Users**](../protocol/participants.md#yield-users) deposit assets into OptyFi vaults, increasing the Protocol’s asset base and revenues. Increased assets improve economic efficiency and therefore Protocol profitability. -2. \*\*\*\*[**Builders**](../protocol/participants.md#builders) ****\(contributors\) enhance OptyFi by improving the Protocol's utility to users \(attracting more users and assets\) and increasing the Protocol's ability to generate above market returns. This results in increased revenues and profitability for the Protocol. +1. [**Users**](../protocol/participants.md#yield-users) deposit assets into OptyFi vaults, increasing the Protocol’s asset base and revenues. Increased assets improve economic efficiency and therefore Protocol profitability. +2. [**Builders**](../protocol/participants.md#builders) \(contributors\) enhance OptyFi by improving the Protocol's utility to users \(attracting more users and assets\) and increasing the Protocol's ability to generate above market returns. This results in increased revenues and profitability for the Protocol. In a self-reinforcing cycle, the OPTY token is used as an incentivization mechanism for users and contributors. As users and contributors increase the Protocol’s value, they become its owners and accrue the benefits of the value they have helped create. - diff --git a/opty/opty-tokenomics.md b/opty/opty-tokenomics.md index 75a5c78..58de7bf 100644 --- a/opty/opty-tokenomics.md +++ b/opty/opty-tokenomics.md @@ -6,7 +6,7 @@ The OPTY token has a total supply of 100,000,000 allocated as follows: ![OPTY Token Allocation.](../.gitbook/assets/opty-token-allocation-2.png) -| Category | Allocation | Distribution | +| **Category** | **Allocation** | **Distribution** | | :--- | :--- | :--- | | Team + Advisors | 28% | 18 Months. Starting in Month 6. | | Investors | 3-10% | 12 Months. | @@ -14,13 +14,12 @@ The OPTY token has a total supply of 100,000,000 allocated as follows: | Builder Rewards | 10% | 24 - 60 Months. | | Treasury/IDO | 2-9% | TBD | -**Team + Advisors \(28%\):** Tokens will be allocated to ****the Core Team and Advisors who helped develop and launch the OptyFI Protocol. +**Team + Advisors \(28%\):** Tokens will be allocated to the Core Team and Advisors who helped develop and launch the OptyFI Protocol. -**Investors \(3-10%\):** 3% of total supply is allocated to the friends and family investors who helped bootstrap development of the OptyFi Protocol. Should additional financing be necessary prior to launch, a maximum of 7% of total supply would be allocated to investors. Any portion of this category not allocated to investors would instead be re-allocated to the Protocol's Treasury/IDO \(see below\). +**Investors \(3-10%\):** 3% of the total supply is allocated to the investors who helped bootstrap development of the OptyFi Protocol. Should additional financing be necessary prior to launch, a maximum of 7% of the total supply would be allocated to investors. Any portion of this category not allocated to investors would instead be re-allocated to the Protocol's Treasury/IDO \(see below\). -**User Rewards \(50%\):** Tokens will be used to incentivize [Users](../protocol/participants.md#yield-users) to maintain assets in OptyFi vaults as well as to stake OPTY in OptyFi staking pools. The Protocol attempts to [optimize OPTY User Rewards distribution](adaptive-user-rewards-distribution.md) to achieve a balance between asset growth and Protocol value. This is accomplished by allowing Governance to set the rate at which OPTY tokens are distributed for User Rewards as well as the allocation of OPTY to the different OptyFi vaults and staking pools. +**User Rewards \(50%\):** Tokens will be used to incentivize both [Users](../protocol/participants.md#yield-users) who maintain assets in OptyFi vaults and stake OPTY in OptyFi staking pools. The Protocol attempts to [optimize OPTY's User Rewards distribution](adaptive-user-rewards-distribution.md) to achieve a balance between asset growth and Protocol value. This is accomplished by allowing Governance to set the rate at which OPTY tokens are distributed for User Rewards, and determine the allocation of OPTY to the different OptyFi vaults and staking pools. -**Builder Rewards \(10%\):** Tokens will be used to incentivize [Builders ](../protocol/participants.md#builders)\(integrators, strategists, risk analysts and data providers\) and other ecosystem contributors who will improve the utility of the OptyFi Protocol. Contributor rewards will be issued pursuant to approved Governance proposals or distributed by the Operators under discretion granted by Governance. +**Builder Rewards \(10%\):** Tokens will be used to incentivize [Builders ](../protocol/participants.md#builders)\(integrators, strategists, risk analysts and data providers\) and other ecosystem contributors who improve the utility of the OptyFi Protocol. Contributor rewards will be issued pursuant to approved Governance proposals or distributed by the Operators under discretion granted by Governance. **Treasury/IDO \(2-9%\):** The treasury allocation will be used to fund the operations and administration of the Protocol. The treasury allocation may also be used towards an Initial DEX Offering \(IDO\). - diff --git a/protocol/optyfi-protocol/README.md b/protocol/optyfi-protocol/README.md index d856c24..51af1a6 100644 --- a/protocol/optyfi-protocol/README.md +++ b/protocol/optyfi-protocol/README.md @@ -1,12 +1,9 @@ # The OptyFi Protocol -The OptyFi Protocol approaches DeFi yield from a first principles perspective. - -Starting with an abstracted view of liquidity pools, we define yield [strategy steps](strategy-composition.md#strategy-step) which can be combined in [sequence](strategy-composition.md#strategy-sequence) into yield strategies, which in turn can be combined in parallel into yield portfolios. The universe of possible strategies form a directed [Strategy Graph](strategy-composition.md#strategy-graph), and executing a yield strategy can be conceptualized as traversing this Strategy Graph. - -Users deposit their assets into OptyFI vaults, from where these assets are continuously deployed into optimal strategies that match the [risk profile](risk-framework.md#risk-profiles) of the vault. - -[Strategy Execution](strategy-execution.md) contracts are able to execute any arbitrary multi-step strategy while enforcing [risk constraints](risk-framework.md). The [Optimization Engine](optimization-engine.md) continuously monitors thousands of data points across hundreds of liquidity pools in order to recommend the current optimal strategy to vaults. +The OptyFi Protocol approaches DeFi yield from a [first principles perspective](https://fs.blog/first-principles/). +Starting with an abstract view on liquidity pools, [strategy steps](strategy-composition.md#strategy-step) are defined, which are [sequentially combined](strategy-composition.md#strategy-sequence) into yield strategies. Multiple yield strategies can in turn be combined in parallel to obtain yield portfolios. The multitude of possible strategies form a directed [Strategy Graph](strategy-composition.md#strategy-graph), and executing a yield strategy can be conceptualized as traversing this Strategy Graph. +Users deposit their assets into OptyFi vaults. These vaults function as a liquidity pool from which assets are continuously deployed into optimal strategies that match the [risk profile](risk-framework.md#risk-profiles) of the vault. +[Strategy Execution](strategy-execution.md) contracts are able to execute any arbitrary multi-step strategy while enforcing [risk constraints](risk-framework.md). The [Optimization Engine](optimization-engine.md) continuously monitors thousands of data points across hundreds of liquidity pools in order to recommend the current optimal strategy to vaults. diff --git a/protocol/optyfi-protocol/optimization-engine.md b/protocol/optyfi-protocol/optimization-engine.md index 36a0312..d431a18 100644 --- a/protocol/optyfi-protocol/optimization-engine.md +++ b/protocol/optyfi-protocol/optimization-engine.md @@ -1,23 +1,22 @@ # Optimization Engine -DeFi is known to be volatile and DeFi yield markets are significantly inefficient. This means that the yields \(and risk\) of liquidity pools change continuously even for pools with the same underlying asset. The composability of DeFi protocols allows assets to be exchanged for "derivative assets" \(e.g. DAI for cDAI\) creating more potential volatility. +DeFi is known to be volatile and DeFi yield markets are significantly inefficient. This means that the yields \(and risk\) of liquidity pools change continuously, even for pools with the same underlying assets. The composability of DeFi protocols allows assets to be exchanged for "derivative assets" \(e.g. DAI for cDAI\), creating more potential volatility. -OptyFi is designed to allow continuous discovery of the most optimal yield strategies. Since this requires evaluation of multiple blocks of data from hundreds of liquidity pools, initially OptyFi's Optimization Engine is designed as an off-chain process that "recommends" the optimal strategy to each vault. [Strategy Execution](strategy-execution.md) smart contracts are responsible for executing this strategy, ensuring it includes only approved pools and enforcing risk constraints of the vault. +OptyFi is designed to allow continuous discovery of the most optimal yield strategies. Since this requires evaluation of multiple blocks of data from hundreds of liquidity pools, OptyFi's Optimization Engine is initially designed as an off-chain process that "recommends" the optimal strategy for each vault, with the intent to eventually decentralize said Optimization Engine. [Strategy Execution](strategy-execution.md) smart contracts are responsible for executing this strategy, ensuring it includes only approved pools and enforcing risk constraints of the vault. ![How the OptyFi optimization engine works.](../../.gitbook/assets/optimization-engine%20%281%29.svg) ## Implementation -The Optimization Engine is implemented in a custom developed python library Opty.py which will be open-sourced and shared with the community. Key functions include: +The Optimization Engine is implemented in a custom python library (Opty.py) developed by the OptyFi team. This library will be open-sourced and shared with the community. Key functions include: -| Component | Function | +| **Component** | **Function** | | :--- | :--- | -| **getPoolData** | Fetches liquidity pool data from the OptyFi API server. Currently, automated jobs capture pool data from the blockchain on an ongoing basis and make this data available to the Optimization Engine. However, this should be replaced by the Graph Protocol prior to launch. | -| **predictRates** | Uses fetched pool data to predict the deposit, borrow and reward rates for liquidity pools for the upcoming rebalancing window. This component incorporates pool data modelling; time series modelling and prediction and price impact modelling. | -| **buildStrategies** | Dynamically generates all possible strategies given the enabled pools. | -| **scoreStrategies** | Provides a score to each generated strategy based on the predicted rates. | +| getPoolData | Fetches liquidity pool data from the OptyFi API server. Currently, automated jobs capture pool data from the blockchain on an ongoing basis and make this data available to the Optimization Engine. However, this should be replaced by the Graph Protocol prior to launch. | +| predictRates | Uses fetched pool data to predict the deposit, borrow and reward rates for liquidity pools for the upcoming rebalancing window. This component incorporates pool data modelling; time series modelling and prediction and price impact modelling. | +| buildStrategies | Dynamically generates all possible strategies given the enabled pools. | +| scoreStrategies | Provides a score to each generated strategy based on the predicted rates. | ## Decentralization -The OptyFi road map includes the decentralization of the Optimization Engine. Possible approaches include implementation on an L2 chain or the development of a custom and efficient OptyFi Yield Chain. - +The OptyFi road map includes the decentralization of the Optimization Engine. Possible approaches include implementation on an L2 chain or the development of a custom and efficient OptyFi Yield Chain. diff --git a/protocol/optyfi-protocol/risk-framework.md b/protocol/optyfi-protocol/risk-framework.md index 1656937..2d58a32 100644 --- a/protocol/optyfi-protocol/risk-framework.md +++ b/protocol/optyfi-protocol/risk-framework.md @@ -12,11 +12,11 @@ Currently the OptyFi Protocol implements three pool ratings: The system is flexible to accommodate an arbitrary number of pool ratings without modification to smart contract code. -Each liquidity pool integrated with the OptyFi Protocol is assigned a pool rating. This rating is currently established by governance vote. However in the future, governance may vote to use an external service \(such as [defiscore.io](www.defiscore.io)\), or subscribe to pool ratings from community [risk analysts](../participants.md#risk-analysts). +Each liquidity pool integrated with the OptyFi Protocol is assigned a pool rating. This rating is currently established through governance voting. However, in the future, governance voting may decide for the use of external services \(such as [defiscore.io](www.defiscore.io)\) or community [risk analysts](../participants.md#risk-analysts). The latter would function as a determinant for the risk attached to a pool. Currently, all pools for a given protocol are assigned the same rating, as follows: -| Protocol | Pool Rating | +| **Protocol** | **Pool Rating** | | :--- | :--- | | Aave | T1 | | Compound | T1 | @@ -29,9 +29,9 @@ Currently, all pools for a given protocol are assigned the same rating, as follo ## Risk Profiles -Each strategy is assigned a risk profile based on the ratings of pools involved in the strategy along with the complexity of the strategy. Currently, the following risk profiles are defined: +Each strategy is assigned a risk profile based on the ratings of the pools involved in the strategy along with the complexity of the strategy. Currently, the following risk profiles are defined: -| Risk Profile | Description | Pool Ratings | Strategy Complexity | +| **Risk Profile** | **Description** | **Pool Ratings** | **Strategy Complexity** | | :--- | :--- | :--- | :--- | | RP0 | Default | N/A | Hold In Vault | | RP1 | Basic | T1 | Multi-Step, No Borrow | @@ -56,7 +56,7 @@ The limits work as follows: To better understand the application of these investment limits, take a look at the examples below. -| Protocol | Protocol Investment Limit Mode | Protocol Max Percent | Pool | Pool Max Percent | Pool Max Amount | +| **Protocol** | **Protocol Investment Limit Mode** | **Protocol Max Percent** | **Pool** | **Pool Max Percent** | **Pool Max Amount** | | :--- | :--- | :--- | :--- | :--- | :--- | | Compound | Percent | 500% | cDAI | 100% | N/A | | Compound | Percent | 500% | cBTC | Null \(defaults to 500%\) | N/A | diff --git a/protocol/optyfi-protocol/strategy-composition.md b/protocol/optyfi-protocol/strategy-composition.md index 3d14bd9..5f3c467 100644 --- a/protocol/optyfi-protocol/strategy-composition.md +++ b/protocol/optyfi-protocol/strategy-composition.md @@ -2,11 +2,11 @@ Yield strategies are the fundamental building block of the OptyFi Protocol and its most compelling innovation. -Conceptually, yield strategies are generated dynamically based on the structure of DeFi liquidity pools. The building blocks for strategies are strategy steps and strategy sequences. The universe of possible strategy sequences together form a strategy graph. +Conceptually, yield strategies are generated dynamically based on the structure of existing DeFi liquidity pools. The building blocks for strategies are [strategy steps](strategy-composition.md#strategy-step) and [strategy sequences](strategy-composition.md#strategy-sequence). Put together, the entirety of strategy sequences form the [strategy graph](strategy-composition.md#strategy-graph). ## Strategy Step -A strategy step is the fundamental building block of a strategy. A strategy step may consist of a deposit step or a borrow step. +A strategy step is a fundamental building block of a strategy. A strategy step can be categorized as a deposit step or a borrow step. ### Deposit Step @@ -22,7 +22,7 @@ Depositing an underlying token into a pool as collateral and then borrowing an u ## Strategy Sequence -A strategy sequence is comprised of multiple strategy steps. +A strategy sequence comprises multiple strategy steps. If a token is deposited into a pool and the LP token you receive in return can be deposited into a second pool, then you can "string together" two strategy steps to form a two-step strategy sequence. @@ -30,11 +30,10 @@ If a token is deposited into a pool and the LP token you receive in return can b This process can be generalized into n-steps based on the condition `outputToken(step[n-1]) = inputToken(step[n])`. -In today's DeFi reality, strategy sequences are usually limited to a maximum of two deposit steps or two deposit steps with a borrow step. +In today's DeFi reality, strategy sequences are usually limited to two deposit steps or two deposit steps with a borrow step. ## Strategy Graph -The universe of possible strategy sequences forms a directed \(possibly cyclic\) graph which we refer to as the Strategy Graph. The nodes of the Strategy Graph represent liquidity pools and inbound edges represent deposits into those liquidity pools. - -OptyFi's Strategy Graph is determined by liquidity pools integrated with the Protocol. Integrating a new liquidity pool to the Protocol creates a new node which potentially generates many more possible strategies. +The entirety of possible strategy sequences form a directed \(possibly cyclic\) graph which we refer to as the Strategy Graph. The nodes of the Strategy Graph represent liquidity pools and the inbound edges represent deposits into those liquidity pools. +OptyFi's Strategy Graph is determined by liquidity pools integrated within the Protocol. Integration a new liquidity pool to the Protocol updates the Strategy graph by adding a new node to the map of nodes. This is turn potentially generates multiple new strategies. diff --git a/protocol/optyfi-protocol/strategy-execution.md b/protocol/optyfi-protocol/strategy-execution.md index 7fed2c9..ed06cb5 100644 --- a/protocol/optyfi-protocol/strategy-execution.md +++ b/protocol/optyfi-protocol/strategy-execution.md @@ -6,36 +6,29 @@ Each [vault](vaults.md) calls upon the [Strategy Manager](strategy-execution.md# ## Architecture -OptyFi implements a "hub-and-spoke" architecture with the core contracts \(Registry, Strategy Manager, Risk Manager\) forming the central hub and vaults and DeFi Adapters forming the spokes. This design makes OptyFi easily extensible by adding vaults for new assets or adding DeFi adapters for new protocols and integrated liquidity pools. +OptyFi implements a "hub-and-spoke" architecture, where the core contracts \(e.g. Registry, Strategy Manager, Risk Manager\) form the central hub, and the vaults and DeFi Adapters form the spokes. This design makes OptyFi easily extensible, e.g. by adding vaults for new assets or adding DeFi adapters for new protocols and integrated liquidity pools. ![The OptyFi Architecture.](../../.gitbook/assets/architecture.svg) ## Strategy Manager -The Strategy Manager contract is able to generate code for any generalized multi-step strategy \(including strategies with a borrow step\). However, the Strategy Manager does not execute this code but rather returns this code to the vault which then executes the strategy. This security feature ensures that at each strategy step, assets \(input tokens and output tokens of the strategy\) always remain in the vault and are not transferred between OptyFi contracts. +The Strategy Manager contract is able to generate code for any generalized multi-step strategy \(including strategies with a borrow step\). However, the Strategy Manager does not execute this code but rather returns this code to the vault, which then executes the strategy. This security feature ensures that, at each strategy step, assets \(input tokens and output tokens of the strategy\) always remain in the vault and are not transferred between OptyFi contracts. -The Strategy Manager does not know how to interact with the various DeFi pools. For this purpose, it calls upon OptyFi's [DeFi Adapters.](strategy-execution.md#defi-adapters) The Strategy Manager also calls upon the [Risk Manager](strategy-execution.md#risk-manager) to enforce risk constraints. +The Strategy Manager does not know how to interact with the various DeFi pools. For this purpose, it calls upon OptyFi's [DeFi Adapters](strategy-execution.md#defi-adapters). The Strategy Manager also calls upon the [Risk Manager](strategy-execution.md#risk-manager) to enforce risk constraints. ## Risk Manager -Prior to returning the strategy execution code to a vault, the [Strategy Manager ](strategy-execution.md#strategy-manager)calls upon the Risk Manager contract to check that the strategy about to be executed: +Prior to returning the strategy execution code to a vault, the [Strategy Manager](strategy-execution.md#strategy-manager) calls upon the Risk Manager contract to check that the strategy about to be executed: * only includes liquidity pools approved by governance. * matches the vault's risk profile. If these checks fail, the strategy will not be executed. -The Risk Manager enables OptyFi to enforce risk constraints in real time. For example, consider the case where pool ratings are being provided by a credit risk oracle service and a given pool is downgraded from T1 to T2. In such a case, the Risk Manager will "block" in real time any strategies that do not allow T2 pools. +The Risk Manager enables OptyFi to enforce risk constraints in real time. Consider the case where pool ratings are being provided by a credit risk oracle service and a given pool is downgraded from T1 to T2. In such a case, the Risk Manager will automatically be updated to "block" any strategies that do not allow T2 pools. ## DeFi Adapters While the Strategy Manager knows how to generate the code for a multi-step strategy, it does not know how to perform deposits, withdrawals or otherwise interact with specific liquidity pools. Protocol-specific DeFi Adapters contain code to interact with liquidity pools. In order to add the liquidity pools of a new protocol to the OptyFi system, a new DeFi adapter must be coded and deployed. -DeFi Adapters are easy to code and deploy. It is expected that a developer with knowledge of a liquidity generating protocol should be able to code the DeFi Adapter for that protocol within a week. - - - - - - - +DeFi Adapters are relatively easy to code and deploy. It is expected that a developer with knowledge of a liquidity generating protocol should be able to code the DeFi Adapter for that protocol within a week. diff --git a/protocol/optyfi-protocol/strategy-types/README.md b/protocol/optyfi-protocol/strategy-types/README.md index 506c0f0..4d69052 100644 --- a/protocol/optyfi-protocol/strategy-types/README.md +++ b/protocol/optyfi-protocol/strategy-types/README.md @@ -4,19 +4,14 @@ The OptyFi Protocol defines two major types of strategies for vaults: [Investmen ## Investment Strategies -OptyFi vault assets are deposited into DeFi liquidity pools to generate yield based on predefined investment strategies. These strategies may be single-step or multi-step and may include a borrow step. +OptyFi vault assets are deposited into DeFi liquidity pools in order to generate yield based on predefined investment strategies. These strategies may be single-step or multi-step and may include a borrow step. Diagrams and examples of Investment Strategies can be found [here](investment-strategies.md). ## Reward Strategies -By undertaking certain investment strategies, OptyFi vaults may earn reward tokens \(such as COMP for Compound or CRV for Curve\). - -The vault reward strategies determine how much of these reward tokens will be converted back to the vault underlying assets after being claimed from the reward protocols, and how much will be held in reward vaults. - -Diagrams and examples of Reward Strategies can be found [here](reward-strategies.md). - - - +By undertaking certain investment strategies, OptyFi's vaults may earn reward tokens \(such as COMP for Compound or CRV for Curve\). +The vault reward strategies determine how much of these reward tokens will be converted back to the vault's underlying assets \(after being claimed from the reward protocols\) and how much will be send to the reward vaults. +Diagrams and examples of Reward Strategies can be found [here](reward-strategies.md). diff --git a/protocol/optyfi-protocol/strategy-types/investment-strategies.md b/protocol/optyfi-protocol/strategy-types/investment-strategies.md index c4c7e80..cb963c6 100644 --- a/protocol/optyfi-protocol/strategy-types/investment-strategies.md +++ b/protocol/optyfi-protocol/strategy-types/investment-strategies.md @@ -8,7 +8,7 @@ Zero-Step strategies hold underlying assets in vaults and do not deposit them in ![A Zero-Step Strategy.](../../../.gitbook/assets/zero-step-strategy-1.svg) -For example, simply holding COMP tokens in a reward vault to earn more COMP! +For example, staking pools can earn the user COMP by simply holding COMP tokens in a reward vault! ## One-Step Strategy @@ -18,7 +18,7 @@ One-Step strategies deposit the underlying asset of a vault into a single liquid The following are some examples of One-Step strategies: -| Vault Type | Input Token | Liquidity Pool | Output Token | +| **Vault Type** | **Input Token** | **Liquidity Pool** | **Output Token** | | :--- | :--- | :--- | :--- | | Core Vault | DAI | Compound | cDAI | | LP Vault | cDAI | Cream | crDAI | @@ -34,7 +34,7 @@ One-Step with Borrow strategies deposit the underlying asset of a vault into a c The following is an example of a One-Step with Borrow strategy: -| Vault Type | Input Token | Collateral Pool | Borrow Token | Liquidity Pool | Output Token | +| **Vault Type** | **Input Token** | **Collateral Pool** | **Borrow Token** | **Liquidity Pool** | **Output Token** | | :--- | :--- | :--- | :--- | :--- | :--- | | Core Vault | DAI | Aave | USDC | dFORCE | dUSDC | @@ -62,9 +62,8 @@ Two-Step with Borrow strategies deposit the underlying asset of a vault into a c The following is an example of a Two-Step with Borrow strategy: -| Vault Type | Input Token | Collateral Pool | Borrow Token | Liquidity Pool | LP Token | Liquidity Pool | Output Token | +| **Vault Type** | **Input Token** | **Collateral Pool** | **Borrow Token** | **Liquidity Pool** | **LP Token** | **Liquidity Pool** | **Output Token** | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Core Vault | WETH | Aave | USDC | Curve | 3CRV | Curve | gUSD | In the example above, the vault takes WETH as the underlying asset, deposits WETH into Aave WETH collateral pool, borrows USDC from Aave USDC borrow pool, deposits USDC into Curve USDC pool, gets 3CRV LP token, deposits 3CRV into Curve 3CRV pool, and then gets gUSD as the output token. - diff --git a/protocol/optyfi-protocol/strategy-types/reward-strategies.md b/protocol/optyfi-protocol/strategy-types/reward-strategies.md index 37b4f1e..7ec97a6 100644 --- a/protocol/optyfi-protocol/strategy-types/reward-strategies.md +++ b/protocol/optyfi-protocol/strategy-types/reward-strategies.md @@ -4,14 +4,14 @@ Reward strategies are executed by OptyFi vaults as follows: 1. Vaults execute investment strategies that earn rewards from DeFi protocols. 2. Vaults claim reward tokens from the reward protocols \(for example, BAL from Balancer\). -3. X% of reward tokens are converted to vault underlying assets and deposited back into the vaults. -4. Y% of reward tokens are held in the reward vaults to earn more rewards. +3. X% of the reward tokens are converted to the vault's underlying assets and deposited back into the vaults. +4. Y% of the reward tokens are held in the reward vaults to earn more rewards. ![A Vault Reward Strategy.](../../../.gitbook/assets/reward-strategy.svg) -The following are examples of Vault Reward strategies: +The following table lists several examples of Vault Reward strategies: -| Vault Type | Input Token | Reward Protocol | Reward Token | Harvest To Core Vault | Hold In Reward Vault | +| **Vault Type** | **Input Token** | **Reward Protocol** | **Reward Token** | **Harvest To Core Vault** | **Hold In Reward Vault** | | :--- | :--- | :--- | :--- | :--- | :--- | | Core Vault | DAI | Compound | COMP | 50% | 50% | | Core Vault | DAI | Curve | CRV | 100% | 0% | @@ -19,4 +19,3 @@ The following are examples of Vault Reward strategies: In the first example above, the vault claims COMP rewards from the Compound protocol and converts 50% of the rewards back to DAI to deposit into the DAI core vault. The remaining 50% is held in the COMP reward vault to earn more COMP tokens. On the other hand, in the second example, the vault claims CRV rewards from the Curve protocol and converts 100% of the rewards back to DAI to deposit into the DAI core vault. - diff --git a/protocol/optyfi-protocol/tokens-and-pools.md b/protocol/optyfi-protocol/tokens-and-pools.md index 9ddc873..5870e43 100644 --- a/protocol/optyfi-protocol/tokens-and-pools.md +++ b/protocol/optyfi-protocol/tokens-and-pools.md @@ -4,21 +4,20 @@ Tokens are blockchain-based digital assets that conform to widely accepted standards such as ERC-20 or ERC-721. Within the OptyFi protocol, a token may be categorized into one or more of the following categories: -* **Core Token:** Refers to fundamental tokens such as DAI, USDC, LINK and WETH. -* **LP Token:** Represents ownership in a [liquidity pool](tokens-and-pools.md#liquidity-pools). Within the OptyFi protocol, pool tokens may be: +* **Core Token:** Fundamental tokens such as DAI, USDC, LINK and WETH. +* **LP Token:** The token holding ownership in a [liquidity pool](tokens-and-pools.md#liquidity-pools). Within the OptyFi protocol, pool tokens may be: * **Single-Asset LP Tokens** such as cDAI or aUSDC. * **Multi-Asset LP Tokens** such as UNI-ETH-USDT. -* **Vault Token:** Represents ownership in an OptyFi vault. It should be noted that vaults are a type of liquidity pool, therefore vault tokens are also LP Tokens. -* **Input Token \(aka Underlying Token\):** The asset deposited into or held by a pool or vault. +* **Vault Token:** The token holding ownership in an OptyFi vault. It should be noted that vaults are a type of liquidity pool, therefore vault tokens are also LP Tokens. +* **Input Token \(aka Underlying Token\):** The token deposited into or held by a pool or vault. * **Output Token \(aka LP Token\):** The token received when depositing into a pool. Output tokens are interchangeably referred to as LP Tokens. -* **Reward Token:** The token distributed by a Protocol to reward its users and/or community. Examples include OPTY, COMP and CRV for the OptyFi, Compound and Curve protocols respectively. +* **Reward Token:** The token distributed by a Protocol to reward its users and/or community. Examples include OPTY, COMP, and CRV for OptyFi, Compound, and Curve protocols, respectively. ## Liquidity Pools -Liquidity pools are smart contracts that collect assets from liquidity providers and generate returns from these assets and then share these returns with liquidity providers. +Liquidity pools are smart contracts that collect assets from liquidity providers and generate returns from these assets. These returns are then distributed among the liquidity providers. Two common types of liquidity pools are: -* **Lending Pools** that generate interest fees from lending out pool assets to borrowers \(e.g. the Compound cDAI pool\). -* **Trading Pools** that generate trading fees by allowing traders to swap assets \(e.g. the Uniswap ETH-USDT pool\). - +* **Lending Pools**: These generate interest fees from lending out pool assets to borrowers \(e.g. the Compound cDAI pool\). +* **Trading Pools**: These generate trading fees by allowing traders to swap assets \(e.g. the Uniswap ETH-USDT pool\). diff --git a/protocol/optyfi-protocol/vaults.md b/protocol/optyfi-protocol/vaults.md index 3a0c4fc..6f2bd38 100644 --- a/protocol/optyfi-protocol/vaults.md +++ b/protocol/optyfi-protocol/vaults.md @@ -1,12 +1,12 @@ # Vaults -Vaults are OptyFi smart contracts into which users deposit assets so that these assets can be deployed into strategies. Vaults enable users to share gas costs and thereby increase user profitability while also enabling more frequent strategy switching. +Vaults are OptyFi smart contracts into which users deposit assets. Vaults automatically manage assets based on the optimal [strategy](strategy-composition.md) available, and enable users to share gas costs and thereby increase user profitability while also enabling more frequent strategy switching. -Each vault has a [vault type](vaults.md#vault-types) determined by its underlying token \(i.e. the token users would deposit into the vault\). Each vault is also associated with a specific [risk profile](risk-framework.md#risk-profiles) which determines which strategies the vault can and cannot deploy assets into. +Each vault has a [vault type](vaults.md#vault-types) determined by its [underlying token](tokens-and-pools.md#tokens) \(i.e. the token users would deposit into the vault\). Each vault is also associated with a specific [risk profile](risk-framework.md#risk-profiles), which determines which strategies the vault is permited to deploy assets into. ## Vault Types -| Type | Underlying Token Example | +| **Type** | **[Underlying Token Example](tokens-and-pools.md#tokens)** | | :--- | :--- | | Core Vault | DAI, USDC, USDT, WBTC, WETH | | LP Vault | cDAI, aUSDC, UNI-ETH-USDT, BAL-OPTY-USDC | @@ -20,11 +20,11 @@ LP Vaults can accept Single-Asset LP Tokens like cDAI or aUSDC as well as Multi- There will be a separate vault for each underlying asset and risk profile combination. -Upon launch \(ETA July 2021\), the following vaults will be deployed. +During the Alpha phase, the following vaults will be deployed: -| Underlying Asset | Risk Profile | +| **[Underlying Asset](tokens-and-pools.md#tokens)** | **[Risk Profile](risk-framework.md#risk-profiles)** | | :--- | :--- | -| DAI | RP1, RP2 | +| WETH | RP1, RP2 | | USDC | RP1, RP2 | | USDT | RP1, RP2 | | WETH | RP1, RP2 | @@ -32,5 +32,4 @@ Upon launch \(ETA July 2021\), the following vaults will be deployed. | BAL-OPTY-USDC | RP0 | | BAL-ODEFI-USDC | RP0 | -For example, the DAI-RP1 vault will accept DAI as the input token and then deploy DAI into various strategies that meet the RP1 risk profile. - +For example, the WETH-RP1 vault will accept WETH as the input token and then deploy WETH into various strategies that meet the RP1 risk profile. Progressively, in the Beta and Full launches, more vaults will be deployed incrementally by the OptyFi protocol. diff --git a/protocol/participants.md b/protocol/participants.md index c643744..ed060fc 100644 --- a/protocol/participants.md +++ b/protocol/participants.md @@ -19,7 +19,7 @@ The OptyFi Protocol enables specialization of the strategist's various roles, th ### Integrators -Integrators expand the "reach" of the OptyFi Protocol by adding integrations \([DeFi Adapters](optyfi-protocol/strategy-execution.md#defi-adapters)\) with other protocols. OptyFi’s architecture makes adding new pools and protocols simple: a new pool can be added in minutes, and a new protocol can be added in days. Each time a strategy is executed using a specific adapter, the Integrator who developed the adapter can receive a portion of Protocol fees generated from that strategy. This incentive mechanism enables the OptyFi protocol to grow at a scale that centralized systems cannot compete with, strengthening OptyFi’s network effects. +Integrators expand the "reach" of the OptyFi Protocol by adding integrations \([DeFi Adapters](optyfi-protocol/strategy-execution.md#defi-adapters)\) with other protocols. OptyFi’s architecture makes adding new pools and protocols simple: a new pool can be added within minutes, and a new protocol can be added within days. Each time a strategy is executed using a specific adapter, the Integrator who developed the adapter can receive a portion of Protocol fees generated from that strategy. This incentive mechanism enables the OptyFi protocol to grow at a scale that centralized systems cannot compete with, strengthening OptyFi’s network effects. ### **Strategists** @@ -27,7 +27,7 @@ OptyFi’s architecture lets strategists focus on strategy optimization rather t ### **Risk Analysts** -The OptyFi architecture decouples strategy definition from strategy risk. Risk Analysts can develop risk assessment systems that assign [pool ratings](optyfi-protocol/risk-framework.md#pool-ratings) to liquidity pools or even directly assign [risk profiles](optyfi-protocol/risk-framework.md#risk-profiles) to any given strategy. Vaults may choose to subscribe risk ratings from a specific Risk Analyst in order to filter the strategies that a Vault may execute and to set the vault’s “portfolio risk composition”. In return, Risk Analysts would be paid a portion of vault fees. +The OptyFi architecture decouples strategy definition from strategy risk. Risk Analysts can develop risk assessment systems that assign [pool ratings](optyfi-protocol/risk-framework.md#pool-ratings) to liquidity pools or even directly assign [risk profiles](optyfi-protocol/risk-framework.md#risk-profiles) to any given strategy. Vaults may choose to subscribe risk ratings from a specific Risk Analyst in order to filter the strategies that a vault may execute and to set the vault’s “portfolio risk composition”. In return, Risk Analysts would be paid a portion of vault fees. ### **Data Providers** @@ -49,4 +49,3 @@ Current DeFi users seeking to access optimal yield need to: OptyFi vaults automatically switch to optimal strategies based on changing conditions. OptyFi’s architecture connects fragmented DeFi yield markets so that users do not have to learn various protocols and dApps or monitor changing rates and fees. OptyFi can also provide vaults-as-a-service to project teams, DAOs and on-chain Asset Managers. These non-individual users can configure and deploy vaults with customized strategies suited to the needs/objectives of their users without the need for custom code development. Investors benefit from the availability of a larger selection of vault investment options specialized to their individual requirements. - diff --git a/protocol/use-cases.md b/protocol/use-cases.md index dff1235..8a481dd 100644 --- a/protocol/use-cases.md +++ b/protocol/use-cases.md @@ -6,7 +6,7 @@ Project teams and DAOs are able to spin-up vaults on demand. The vault owner may ### Long-Tail Asset Optimization -The OptyFi Protocol is well suited for the optimization of long-tail and niche assets. For each such asset it may not be feasible to develop and maintain a custom strategy contract. However, a long-tail asset can be easily added to the OptyFi Strategy Graph, and as long as there is a single liquidity pool \(node\) that accepts it as an underlying asset \(inbound edge\), we are then able to dynamically generate all possible strategies for the asset. This property makes OptyFi suited to the following use cases: +The OptyFi Protocol is well suited for the optimization of long-tail and niche assets. For each such asset it may not be feasible to develop and maintain a custom strategy contract. However, a long-tail asset can be easily added to the OptyFi Strategy Graph, and as long as there is a single liquidity pool \(node\) that accepts it as an underlying asset \(inbound edge\), it will be included in the dynamic generation of strategies for an asset. This property makes OptyFi suited to the following use cases: * DEXes such as Uniswap, Balancer and Sushi Swap that deal in hundreds of currency pairs could invest unused liquidity into niche vaults. * Wallets such as MetaMask could automatically deposit users’ assets into niche vaults to ensure users are obtaining the best returns in DeFi. @@ -20,14 +20,13 @@ This means OptyFi users would have access to yield-generating opportunities acro ### Vault Boosting -OptyFi’s Vault Booster smart contract enables any user/contract to incentivize any ecosystem vault by submitting a transaction that includes the appropriate number of reward tokens along with the rate at which those reward tokens are to be distributed to the target vault. This enables project teams and contracts to influence flow of capital on demand and presents a myriad of possible use cases such as: +OptyFi’s Vault Booster smart contract enables any user/contract to incentivize a vault in any ecosystem by submitting a transaction that includes the appropriate number of reward tokens along with the rate at which those reward tokens are to be distributed to the target vault. This enables project teams and contracts to influence flow of capital on demand and present a myriad of possible use cases such as: * Flexible mechanisms for DAOs to incentivize other DAOs. * Providing “venture capital” to build a target project's liquidity by attracting liquidity providers. ### Factor-Based and Thematic Yield Investing -By explicitly defining the universe of discrete yield strategies, OptyFi enables application of the principles of factor-based investing and thematic investing to yield generation. Thus, instead of only trying to optimize for APY, strategists can optimize strategies based on exposure to various factors and yield portfolios can be developed that specify weight exposures to specific factors. Of course risk could be a primary factor, but almost any factor can be defined such as exposure to pool type \(e.g. DEX, Lending, Derivatives\) or exposure to protocol age. Similarly, vaults can be configured to invest thematically, for example to invest only in liquidity pools related to Ethereum L2 scaling solutions. +By explicitly defining an all-inclusive ensemble of discrete yield strategies, OptyFi enables application of the principles of factor-based investing and thematic investing to yield generation. Thus, instead of only trying to optimize for APY, strategists can develop yield portfolios that specify weight exposures to a variety of curated factors. Theoretically, almost any factors can be utilized to determine a strategy, such as exposure to pool type \(e.g. DEX, Lending, Derivatives\) or exposure to protocol age. Similarly, vaults can be configured to invest thematically, for example, by investing only in liquidity pools related to Ethereum L2 scaling solutions. **The possibilities are endless and we welcome the OptyFi community to propose, vote and implement entirely new ideas.** -
Proposal CategoryIssuesProposal CategoryIssues