APWine: How to Further Unlock the Potential of LP Tokens?
Building Legos on DeFi Legos.As the industry develops, leading DeFi protocols such as Aave, Curve, and yearn.finance (YFI) have somewhat transitioned from "youth to maturity." This is reflected in the fact that the APY (Annual Percentage Rate) of these top DeFi protocols has become the benchmark "bond" of the DeFi industry. Consequently, more new projects are eager to leverage these mature protocols to address the inherent issues of DeFi at this stage and further enhance the industry in niche markets.
Alchemix is a prominent example of this trend. On one hand, Alchemix provides users with a base yield (such as the APY from yearn.finance); on the other hand, it uses this yield as collateral to lend out its own stablecoin as a means of releasing liquidity. The earnings generated by yearn are automatically used to repay the collateralized debt.
After its launch, Alchemix received strong support from the yearn.finance developers and community, and has since garnered a total investment of $8 million from institutions such as CMS Holdings, Alameda Research, Spartan Capital, Delphi Ventures, and Nascent.
At the same time, the rapid development of Alchemix has also contributed to the explosive growth of yearn.finance's TVL. Data source: OKLink
Alchemix went live on February 28, with a current TVL of $420 million. Data source: DeBank
Releasing liquidity from underlying protocols is becoming a new approach within the industry. "Lego on Lego" not only solves the inherent problems of protocols but also deepens the market and enhances user yields.
The APWine introduced in this article chooses to integrate with Harvest, yearn.finance, and Aave to release the earnings of its interest-bearing tokens in advance. Currently, the APWine beta version has been launched, with a locked amount of $4.8 million.
How It Works
APWine is a protocol for trading future yields. DeFi users can deposit interest-bearing LP tokens from other DeFi protocols within a specified future period and trade the future earnings generated in advance. In this process, APWine utilizes two types of tokens:
Future Yield Tokens (FYT) (ERC20): These represent the future earnings generated by an asset on a platform within a specified time. For example, a 30D-AAVE-ADAI-2 represents the earnings generated by 1 ADAI (which is a DAI deposited on AAVE) over 30 days. The "2" represents the future index, as a new cycle begins at the end of each previous period.
APWINE IBT (ERC20): APWine interest-bearing tokens. Holders can withdraw the corresponding deposit funds from the APWine protocol at any time. APWINE IBT holders will receive FYT (future IBT will correspond to it) proportional to their holdings. A 30D-AAVE-ADAI represents an ADAI deposited into the future "30D-AAVE-DAI."
APW (ERC20): APWine governance token. The token can be linked to voting rights obtained in the DAO and protocol fees. Currently, the protocol has not deployed the APW token.
Usage Process
- Deposit funds according to the IBT protocol (for example, deposit DAI in AAVE to obtain ADAI);
Deposit the IBT into APWine within the specified period (for example, 7D-ADAI-AAVE) and receive a proportional APWine IBT;
APWine IBT holders will receive future yield tokens (FYT) at the start of each new period;
Future yield tokens (FYT) can be exchanged/traded like any normal ERC20;
At the expiration of the future period, the earnings generated can be obtained based on these FYT.
Fees
Fees represent a portion of the earnings generated by APWine, with most of the funds being redistributed to APW token holders. Please note that the actual percentage will gradually change to adapt to market demand.
Security
The contracts are being audited by Bramah Systems, and a complete audit report will be released before the mainnet launch.
Project Advisors
APWine's advisors include Julien Bouteloup from the Curve team, Marc Z from Aave, and blockchain research scholar Jiahua Xu from UCL and EPFL.
Developers
The developers of APWine are not well-known figures in the industry. According to their Twitter introduction, most members have experience with the official blockchain student association of EPFL.
According to Baidu, EPFL is the École Polytechnique Fédérale de Lausanne (EPFL), also known as the Swiss Federal Institute of Technology (Lausanne), located in Lausanne, Switzerland. It can trace its origins back to a private school established in 1953 and was officially founded in 1969. Together with its sister school, ETH Zurich, it forms the Swiss Federal Institute of Technology and is part of the Swiss Federal Department of Economic Affairs, Education and Research.
EPFL is a member of the European Consortium of Innovative Universities, focusing on education and research in engineering, natural sciences, and architecture. It is a top research university in Europe and the world, with many notable alumni, including Turing Award winner Joseph Sifakis, Nobel Prize in Chemistry winner Jacques Dubochet, and Scala programming language inventor Martin Odersky, among others.
