Debita

Demo

About

The problem it solves Our primary focus is pushing the narrative to collateralise yield-bearing tokens such as LSTs, auto-compounders receipt tokens, GMX-style index tokens, and, most importantly, veNFTs from ve3,3 Solidly style dexes such as Aerodrome, which is our niche target market. With veNFTs, the user can borrow against their position and remain in control of the asset’s main functions while the loan is ongoing, allowing them to vote, claim their rewards, and extend their lock for maximum yield. That feature transforms a simple loan into a self-repaying loan. If the user votes and claims their rewards regularly, depending on the terms set, the yield from the voting rewards will cover part, if not all, of the interest owed to the lender, unlocking liquidity from an otherwise illiquid asset with minimal, if any, out-of-pocket fees. #### Example: #### * User borrows 100 USDbC (50% of the nominal value of their $200 worth veAERO position) for 30 days with 5% interest (~60% APR). * Current average voting rewards APR on veAERO is 60%. * The user will yield a 5% monthly ROI ($10) on their veAERO while paying 5% interest over 50% of their position ($5) for the same period. ## Oracle-less ## Being an oracle-less product means that our contracts do not rely on price feeds, and the terms of the loan are based on the actual number of tokens input at the time the offer was accepted. In other words, there are no liquidations in the usual sense of the word. The only way for a borrower to not recover their collateral asset is if they don’t pay back the owed amount (borrowed amount + interest) by the end of the agreed upon loan’s term. In that case, the borrower effectively defaults on the loan and forfeits 100% of their collateral, which the lender can claim.

How it's made

Challenges we ran into Finding a solution to scale a peer-to-peer lending platform into an easy to use, market fit product was a hard task. The idea of pooled funds was always the go-to, but making the logic behind it work was definitely the biggest challenge we encountered. With every solution, a new issue would surface in an almost never-ending cycle. Once we found the best way to proxy the offers into a pool, the defaulting of non-splittable collateral issue arose, which took hours of brainstorming and decision making before we came to a dutch auction solution for it. While we already have our base contract deployed on Fantom Opera, when we decided to launch our pool features on Base we had to rebuild our database from scratch, taking it to a higher level of user experience, having real time data and sub second updates to the UI. Another issue we encountered was the need for users to constantly monitor their positions due to the oracle-less nature of the system. When prices moved between borrow asset and collateral, the loan-to-value ratio set at offer creation would vary and need to be edited accordingly. We found a solution, after much debate, by going against the nature of the protocol and introducing oracle support at a UI level only. As long as the assets have a Chainlink price feed, the pools will be set with the loan-to-value as dictator of the number of tokens to be borrowed per unit of collateral instead of having static numbers. That, paired with our pre-existing “perpetual” option, where, after a loan is paid out, the lent liquidity + interest go back into the offer vault, helps lower friction and increase the set-and-forget liquidity that will boost our TVL.