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Research DAOInflation in GameFi and Traditional Game
1. IntroductionWhether it is a traditional game or the current emerging GameFi, as long as there is a monetary mechanism, it will inevitably face the problem of inflation. Inflation is an issue between demand and supply. When there is more currency circulated in the market with demand staying the same, the currency’s purchasing power decreases, meaning that inflation happens.M represents the total supply of money, V is the velocity (i.e. the circulation of money), P is the price level, which ...
Research DAOZero-Knowledge Proof: from Zero to Hero
Author: @CryptoScott_ETH | @RealResearchDAO ZKP(Zero-Knowledge Proof) is currently a popular black technology, but its technical details are more difficult to understand. This article is to sort out the relevant data in the field of zero-knowledge proof and discuss the application in the industry, hoping to provide non-technical researchers with guidance on ZK research and help them understand zero-knowledge proofs from the simple to the deep. Understand ZKP from the story of Alice & Bob This...
Research DAOThe NFT Product Report (Part 2): Utility Maximization & Cross-Chain Adoption
Author：@BriefKandle, ResearchDAO1. IntroductionMultiverse, a concept in quantum physics, has been explored (way too) many times in fantasy, sci-fi novels, TV shows, and movies. The multiverse communicates with itself through the deus ex machina ideology. A few examples of names for this multiverse communication are "rainbow bridge" and "wormhole.” But how does it actually work? Physically, an Einstein-Rosen Bridges folds space-time and opens up another membrane/world/universe that is unreacha...
<100 subscribers
Research DAOInflation in GameFi and Traditional Game
1. IntroductionWhether it is a traditional game or the current emerging GameFi, as long as there is a monetary mechanism, it will inevitably face the problem of inflation. Inflation is an issue between demand and supply. When there is more currency circulated in the market with demand staying the same, the currency’s purchasing power decreases, meaning that inflation happens.M represents the total supply of money, V is the velocity (i.e. the circulation of money), P is the price level, which ...
Research DAOZero-Knowledge Proof: from Zero to Hero
Author: @CryptoScott_ETH | @RealResearchDAO ZKP(Zero-Knowledge Proof) is currently a popular black technology, but its technical details are more difficult to understand. This article is to sort out the relevant data in the field of zero-knowledge proof and discuss the application in the industry, hoping to provide non-technical researchers with guidance on ZK research and help them understand zero-knowledge proofs from the simple to the deep. Understand ZKP from the story of Alice & Bob This...
Research DAOThe NFT Product Report (Part 2): Utility Maximization & Cross-Chain Adoption
Author：@BriefKandle, ResearchDAO1. IntroductionMultiverse, a concept in quantum physics, has been explored (way too) many times in fantasy, sci-fi novels, TV shows, and movies. The multiverse communicates with itself through the deus ex machina ideology. A few examples of names for this multiverse communication are "rainbow bridge" and "wormhole.” But how does it actually work? Physically, an Einstein-Rosen Bridges folds space-time and opens up another membrane/world/universe that is unreacha...
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Author: @!0xWang1| @RealResearchDAO
Foreword
Imagine when you save your money in the bank, the bank will give you half of the income generated from your savings, so that when you borrow money from the bank, the corresponding interest can be waived. Of course, there are few such good things in traditional finance, but in the world of DeFi with many magics, through Alchemix's unique protocol, even as an ordinary user, such "financial magic" is within reach. Giving money and paying it back for you, is the magical financial "magic" created out of thin air? As long as there is borrowing, there must be loans. For such a perfect "pie", what kind of risk do you have to take to eat it?
Alchemix - The “Alchemist”
Alchemix is a decentralized over-collateralized lending platform built on Yearn. Different from other lending platforms, Alchemix says that users' over-collateralized funds are deposited in Yearn to gain profits, and the profits are divided proportionally to borrowing users, which are used to automatically help users repay interest and debts, and users' positions will not be liquidated. Essentially, Alchemix pools users’ deposit collateral, then deposits those funds into other DeFi protocols and then reaps profits over time to pay off everyone’s debt.
Alchemix's lending mechanism
To borrow money from Alchemix, users first need to over-collateralize their assets. The specified asset mortgage rate is 200%, that is, users stake 100 USD worth of DAI on the platform, allowing them to lend 50 USD worth of alUSD from the platform. The value ratio of DAI to the stablecoin alUSD of the Alchemix platform is 1:1. If the collateralization ratio exceeds 200% due to revenue generation, the user can withdraw the surplus DAI or mint/lend more alUSD until the collateralization ratio of 200% is reached again. For flexibility, users can also settle their crypto loans early by paying off debts with alUSD or DAI. Once users have zero remaining alUSD debt, they can withdraw all deposited collateral.
Many lending platforms will bind the user's staked assets to their respective market prices (USD). Once the extreme market situation occurs and the price of the collateral plummets, the lending protocol will execute the liquidation process in time to liquidate the staked assets. In this case, Alchemix gave a very good solution: directly peg the platform's alUSD (platform’s stablecoin) and the native asset DAI on-chain, and indirectly break free from the shackles of the US dollar. No matter how the USD market price of DAI and other assets changes, alUSD is only pegged 1:1 with DAI. As a result, Alchemix itself has the potential to be one of the DeFi building blocks, truly breaking away from the traditional financial system and relying on the on-chain native assets to maintain its own system stability.
Alchemix's Automatic Debt Repayment System
1. Users deposit DAI in Alchemix, and the platform will issue alUSD, a stablecoin based on liquidity mining, to users as a loan. The loan amount is 50% of the user's deposit amount of DAI (DAI and alUSD are 1:1 pegged), alUSD is used to mark the user's future income.
2. Alchemix invests the DAI deposited by users into Yearn to generate income. 90% of the income will be distributed to users in proportion to repay the loan, and the remaining 10% of the income will be distributed to the Alchemix treasury.
3. The synthetic asset alUSD obtained by the user can also be put into the corresponding Curve pool, which can flow into the wider DeFi field, generate various income, or convert it back to DAI and then convert it into fiat.
What does on-chain alchemy mean? How does Alchemix perform such alchemy?
In Alchemix V1, users are only allowed to stake the stablecoin DAI to lend alUSD. In order to maintain the most fundamental mechanical balance, the ratio between alUSD DAI Dai should be kept stable, and Alchemix began to perform magical alchemy - Transmuter.
The Unique Alchemy Transmuter
Just like the Reactor in Tokemak, what makes Alchemix unique among many DeFi protocols is its original Transmuter module. The reason why Transmuter is called the alchemy of Alchemix is that all assets can be exchanged for 1:1 equivalent assets with 0 slippages through Transmuter. maintain a stable ratio between the two.
Advantages of Stabilizing alUSD and DAI via Transmuter
1. Users do not need to bear the risk of liquidation
Since DAI and alUSD maintain a stable balance ratio of 1:1, and the exchange ratio between DAI and alUSD is also 1:1, the collateral DAI will not depreciate in the Alchemix protocol, which is theoretically no risk of liquidation. Of course, the protocol itself still has a mechanism for handling extreme cases.
2. Free repayment operation
The pegging effect of the collaterals DAI and alUSD makes DAI and alUSD common in Alchemix's loan agreement, so users can choose to repay directly with the collateral, which also means that the collateral has no lock-up time, and can be retrieved at any time. AL assets can also be quickly repegged through arbitrage in the event of de-pegging from collaterals.
Since the utility of alUSD does not only exist in Alchemix, Alchemix also has corresponding preventive mechanisms for the extreme situations that may occur in the value-bound DAI, such as the de-pegging of the price of DAI itself due to extreme market conditions. In order to ensure that the 1:1 exchange of alUSD with DAI will not be dragged down by the de-pegging situation, Alchemix has introduced Chainlink as an oracle. Once the price of DAI is depegged for overall liquidation, the protocol will suspend the minting of alUSD, repayment, and other activities, until the value of DAI returns stable.
The Mechanism of Transmuter
The stable efficacy of Transmuter is critical to the Alchemix protocol, so how does Transmuter work?
First, Alchemix deposits the user's DAI as collateral into Yearn to gain income. The DAI income earned in the Yearn protocol will be invested in Transmuter according to a certain proportion, which is part of the DAI source in the entire Transmuter mechanism. This part of DAI will automatically repay the depositor's debt in proportion. If a user has deposited DAI but not borrowed alUSD, the yield (DAI) that Transmuter provides to the user will increase the user's alUSD lending limit. As the protocol continues to automatically repay users' debts through the path of Yearn - Transmuter - Lending Protocols, users can withdraw more DAI or continue to lend more alUSD, so that their loan protocol always maintains a 200% collateral rate.
Secondly, another part of DAI comes from the alUSD holders in the platform. Since Transmuter can mint the protocol token ALCX while converting both alUSD and dai smoothly, many alUSD users choose to exchange assets in Transmuter. The alUSD converted to DAI in Transmuter will be burned.
Interestingly, Transmuter's user-friendly mechanism doesn't mean that users can be "hands-off" all the time. If the DAI in the user's position exceeds the alUSD corresponding to the staked amount, the surplus DAI can be "claimed" by other users: the first user who finds out and declares this can quickly exchange the staked part of alUSD for DAI. For example, the alUSD staked by User A corresponds to 1000 DAI. Due to the income provided by Yearn, there are 1050 Dai in A's agreement at this time, so the extra 50 can be declared by other users, when User B first find out and declare the extra 50 DAI, then the 50 alUSD staked by User B can be turned into DAI immediately. If the user declares his own surplus, the excess alUSD - Dai quota will be distributed to stakers around the world. The purpose of this is to speed up the conversion of alUSD and DAI while ensuring that the pegs of alUSD and Dai remain unchanged.
Essentially, Alchemist provides a flexible line of credit for users' future earnings. Users can enter and exit at any time without committing to long-term lock-up periods. The user's collateral is never liquidated unless they do it themselves, as the user's debt just keeps going down.
Alchemix V2, spicing up the alchemy furnace
Alchemix is growing, bringing more opportunities and possibilities to the project. As the first-generation V1 version has undergone continuous updates and iterations of testing and smart contracts, the Alchemix V2 version follows.
In the V2 version, more stablecoins such as USDT and USDC will also be available as collaterals for alUSD, which helps to deepen the liquidity of alUSD. More new synthetic assets were included, including alETH and alBTC. Users can deposit BTC and ETH in Alchemix and use minted synthetic assets alBTC, alETH as leverage in the DeFi ecosystem while guaranteeing that their underlying collateral will not be liquidated. For example, users can go long with less risk by depositing ETH, lending alETH, and exchanging it for an equal amount of ETH, then depositing or staking the ETH into another protocol to earn additional yield ETH.
Spend tomorrow's money today, an interesting and practical "future checkbook"
The stability mechanism brought by Alchemix through delicate alchemy also brings a new meaning to the user's loan method: repaying your current debt with future value.
Alchemix "allows the creation of synthetic assets with the future earnings of deposits", and users can release their future value-added earnings in advance by minting al-token. Twitter user 0xdef1.eth described: “Imagine a bank, you deposit cash, the bank pays you an annualized 15% interest, and attaches you a credit card - the credit card limit is 50% of the amount you deposit, with no monthly repayments, as your interest will pay the bill for you (you can also buy the bill outright at any time). "It's like you keep money in a bank account and pay your bills with the interest it will accrue in the future". Saving current money and spending future earnings is like Doraemon's "future checkbook".
Quoted from "Alchemix: An Advanced Guide to DeFi Alchemy" by the Wizards
The governance token ALCX
In addition to collaterals and synthetic assets alAssets, Alchemix also releases its own governance token, $ALCX. Holders receive a proportional portion of the profits escrowed to the Yearn protocol revenue and Yearn management fees, as well as non-transferable voting rights.
The governance token ALCX was initially pre-mined at 478,612, which is calculated from 15% of the estimated circulating supply (2,393,060) after 3 years. 15% of the pre-mined ALCX goes to the DAO treasury, 5% of which is reserved for the bug bounty program.
The token distribution is divided into two stages. The first stage is to allocate 22344 ALCX in the first week of mining and then reduce it by 130 every week after that. The second phase is three years later, with 2,200 releases per week.
It is worth mentioning that the Alchemix team did not conduct any advance financing round when issuing ALCX, but chose to add an ALCX/ETH SLP pool on SushiSwap to distribute native tokens. Users who want to buy ALCX can only obtain ALCX through secondary market purchases or through Alchemix Farm. This makes the circulation of ALCX very low in the short term, and the mint cap of alUSD and the high APY of the farming pool have brought stronger demand for ALCX. The low circulation and high demand make the token price a short-term increase. The strong buying orders and the soaring currency prices have fed back the staking pool, making the APY of the entire pool more beautiful, and the scenery is unlimited for a while.
Conclusion
With the continuous development of the DeFi industry, in order to solve the pain point of DeFi’s liquidity release, new projects with killer features continue to emerge, dazzling DeFi users. Alchemix brings a brand new narrative to the addition of YFI-based DeFi on Ethereum. At the same time, it provides DeFi users with a variety of choices, distinctive and more secure asset management tools. By combining the excellent and stable asset anchoring mechanism with the unique "Alchemy", Alchemix explores a platform mechanism that allows customers to flexibly manage assets, making itself a part of the DeFi lego layer by layer, serving the complex DeFi Add a touch of mystery and fun to the wizarding world.
Join Us Here:
https://docs.google.com/forms/d/e/1FAIpQLSel53Un2E3WrVPCm5Niq3GpHjaYuZ7LdyJECdx-9qUWMpY-FA/viewform
About Us：
Twitter: @RealResearchDAO
Medium:
https://medium.com/@RealResearchDAO
Discord: discord.gg/ZSdgM7x6pc
Author: @!0xWang1| @RealResearchDAO
Foreword
Imagine when you save your money in the bank, the bank will give you half of the income generated from your savings, so that when you borrow money from the bank, the corresponding interest can be waived. Of course, there are few such good things in traditional finance, but in the world of DeFi with many magics, through Alchemix's unique protocol, even as an ordinary user, such "financial magic" is within reach. Giving money and paying it back for you, is the magical financial "magic" created out of thin air? As long as there is borrowing, there must be loans. For such a perfect "pie", what kind of risk do you have to take to eat it?
Alchemix - The “Alchemist”
Alchemix is a decentralized over-collateralized lending platform built on Yearn. Different from other lending platforms, Alchemix says that users' over-collateralized funds are deposited in Yearn to gain profits, and the profits are divided proportionally to borrowing users, which are used to automatically help users repay interest and debts, and users' positions will not be liquidated. Essentially, Alchemix pools users’ deposit collateral, then deposits those funds into other DeFi protocols and then reaps profits over time to pay off everyone’s debt.
Alchemix's lending mechanism
To borrow money from Alchemix, users first need to over-collateralize their assets. The specified asset mortgage rate is 200%, that is, users stake 100 USD worth of DAI on the platform, allowing them to lend 50 USD worth of alUSD from the platform. The value ratio of DAI to the stablecoin alUSD of the Alchemix platform is 1:1. If the collateralization ratio exceeds 200% due to revenue generation, the user can withdraw the surplus DAI or mint/lend more alUSD until the collateralization ratio of 200% is reached again. For flexibility, users can also settle their crypto loans early by paying off debts with alUSD or DAI. Once users have zero remaining alUSD debt, they can withdraw all deposited collateral.
Many lending platforms will bind the user's staked assets to their respective market prices (USD). Once the extreme market situation occurs and the price of the collateral plummets, the lending protocol will execute the liquidation process in time to liquidate the staked assets. In this case, Alchemix gave a very good solution: directly peg the platform's alUSD (platform’s stablecoin) and the native asset DAI on-chain, and indirectly break free from the shackles of the US dollar. No matter how the USD market price of DAI and other assets changes, alUSD is only pegged 1:1 with DAI. As a result, Alchemix itself has the potential to be one of the DeFi building blocks, truly breaking away from the traditional financial system and relying on the on-chain native assets to maintain its own system stability.
Alchemix's Automatic Debt Repayment System
1. Users deposit DAI in Alchemix, and the platform will issue alUSD, a stablecoin based on liquidity mining, to users as a loan. The loan amount is 50% of the user's deposit amount of DAI (DAI and alUSD are 1:1 pegged), alUSD is used to mark the user's future income.
2. Alchemix invests the DAI deposited by users into Yearn to generate income. 90% of the income will be distributed to users in proportion to repay the loan, and the remaining 10% of the income will be distributed to the Alchemix treasury.
3. The synthetic asset alUSD obtained by the user can also be put into the corresponding Curve pool, which can flow into the wider DeFi field, generate various income, or convert it back to DAI and then convert it into fiat.
What does on-chain alchemy mean? How does Alchemix perform such alchemy?
In Alchemix V1, users are only allowed to stake the stablecoin DAI to lend alUSD. In order to maintain the most fundamental mechanical balance, the ratio between alUSD DAI Dai should be kept stable, and Alchemix began to perform magical alchemy - Transmuter.
The Unique Alchemy Transmuter
Just like the Reactor in Tokemak, what makes Alchemix unique among many DeFi protocols is its original Transmuter module. The reason why Transmuter is called the alchemy of Alchemix is that all assets can be exchanged for 1:1 equivalent assets with 0 slippages through Transmuter. maintain a stable ratio between the two.
Advantages of Stabilizing alUSD and DAI via Transmuter
1. Users do not need to bear the risk of liquidation
Since DAI and alUSD maintain a stable balance ratio of 1:1, and the exchange ratio between DAI and alUSD is also 1:1, the collateral DAI will not depreciate in the Alchemix protocol, which is theoretically no risk of liquidation. Of course, the protocol itself still has a mechanism for handling extreme cases.
2. Free repayment operation
The pegging effect of the collaterals DAI and alUSD makes DAI and alUSD common in Alchemix's loan agreement, so users can choose to repay directly with the collateral, which also means that the collateral has no lock-up time, and can be retrieved at any time. AL assets can also be quickly repegged through arbitrage in the event of de-pegging from collaterals.
Since the utility of alUSD does not only exist in Alchemix, Alchemix also has corresponding preventive mechanisms for the extreme situations that may occur in the value-bound DAI, such as the de-pegging of the price of DAI itself due to extreme market conditions. In order to ensure that the 1:1 exchange of alUSD with DAI will not be dragged down by the de-pegging situation, Alchemix has introduced Chainlink as an oracle. Once the price of DAI is depegged for overall liquidation, the protocol will suspend the minting of alUSD, repayment, and other activities, until the value of DAI returns stable.
The Mechanism of Transmuter
The stable efficacy of Transmuter is critical to the Alchemix protocol, so how does Transmuter work?
First, Alchemix deposits the user's DAI as collateral into Yearn to gain income. The DAI income earned in the Yearn protocol will be invested in Transmuter according to a certain proportion, which is part of the DAI source in the entire Transmuter mechanism. This part of DAI will automatically repay the depositor's debt in proportion. If a user has deposited DAI but not borrowed alUSD, the yield (DAI) that Transmuter provides to the user will increase the user's alUSD lending limit. As the protocol continues to automatically repay users' debts through the path of Yearn - Transmuter - Lending Protocols, users can withdraw more DAI or continue to lend more alUSD, so that their loan protocol always maintains a 200% collateral rate.
Secondly, another part of DAI comes from the alUSD holders in the platform. Since Transmuter can mint the protocol token ALCX while converting both alUSD and dai smoothly, many alUSD users choose to exchange assets in Transmuter. The alUSD converted to DAI in Transmuter will be burned.
Interestingly, Transmuter's user-friendly mechanism doesn't mean that users can be "hands-off" all the time. If the DAI in the user's position exceeds the alUSD corresponding to the staked amount, the surplus DAI can be "claimed" by other users: the first user who finds out and declares this can quickly exchange the staked part of alUSD for DAI. For example, the alUSD staked by User A corresponds to 1000 DAI. Due to the income provided by Yearn, there are 1050 Dai in A's agreement at this time, so the extra 50 can be declared by other users, when User B first find out and declare the extra 50 DAI, then the 50 alUSD staked by User B can be turned into DAI immediately. If the user declares his own surplus, the excess alUSD - Dai quota will be distributed to stakers around the world. The purpose of this is to speed up the conversion of alUSD and DAI while ensuring that the pegs of alUSD and Dai remain unchanged.
Essentially, Alchemist provides a flexible line of credit for users' future earnings. Users can enter and exit at any time without committing to long-term lock-up periods. The user's collateral is never liquidated unless they do it themselves, as the user's debt just keeps going down.
Alchemix V2, spicing up the alchemy furnace
Alchemix is growing, bringing more opportunities and possibilities to the project. As the first-generation V1 version has undergone continuous updates and iterations of testing and smart contracts, the Alchemix V2 version follows.
In the V2 version, more stablecoins such as USDT and USDC will also be available as collaterals for alUSD, which helps to deepen the liquidity of alUSD. More new synthetic assets were included, including alETH and alBTC. Users can deposit BTC and ETH in Alchemix and use minted synthetic assets alBTC, alETH as leverage in the DeFi ecosystem while guaranteeing that their underlying collateral will not be liquidated. For example, users can go long with less risk by depositing ETH, lending alETH, and exchanging it for an equal amount of ETH, then depositing or staking the ETH into another protocol to earn additional yield ETH.
Spend tomorrow's money today, an interesting and practical "future checkbook"
The stability mechanism brought by Alchemix through delicate alchemy also brings a new meaning to the user's loan method: repaying your current debt with future value.
Alchemix "allows the creation of synthetic assets with the future earnings of deposits", and users can release their future value-added earnings in advance by minting al-token. Twitter user 0xdef1.eth described: “Imagine a bank, you deposit cash, the bank pays you an annualized 15% interest, and attaches you a credit card - the credit card limit is 50% of the amount you deposit, with no monthly repayments, as your interest will pay the bill for you (you can also buy the bill outright at any time). "It's like you keep money in a bank account and pay your bills with the interest it will accrue in the future". Saving current money and spending future earnings is like Doraemon's "future checkbook".
Quoted from "Alchemix: An Advanced Guide to DeFi Alchemy" by the Wizards
The governance token ALCX
In addition to collaterals and synthetic assets alAssets, Alchemix also releases its own governance token, $ALCX. Holders receive a proportional portion of the profits escrowed to the Yearn protocol revenue and Yearn management fees, as well as non-transferable voting rights.
The governance token ALCX was initially pre-mined at 478,612, which is calculated from 15% of the estimated circulating supply (2,393,060) after 3 years. 15% of the pre-mined ALCX goes to the DAO treasury, 5% of which is reserved for the bug bounty program.
The token distribution is divided into two stages. The first stage is to allocate 22344 ALCX in the first week of mining and then reduce it by 130 every week after that. The second phase is three years later, with 2,200 releases per week.
It is worth mentioning that the Alchemix team did not conduct any advance financing round when issuing ALCX, but chose to add an ALCX/ETH SLP pool on SushiSwap to distribute native tokens. Users who want to buy ALCX can only obtain ALCX through secondary market purchases or through Alchemix Farm. This makes the circulation of ALCX very low in the short term, and the mint cap of alUSD and the high APY of the farming pool have brought stronger demand for ALCX. The low circulation and high demand make the token price a short-term increase. The strong buying orders and the soaring currency prices have fed back the staking pool, making the APY of the entire pool more beautiful, and the scenery is unlimited for a while.
Conclusion
With the continuous development of the DeFi industry, in order to solve the pain point of DeFi’s liquidity release, new projects with killer features continue to emerge, dazzling DeFi users. Alchemix brings a brand new narrative to the addition of YFI-based DeFi on Ethereum. At the same time, it provides DeFi users with a variety of choices, distinctive and more secure asset management tools. By combining the excellent and stable asset anchoring mechanism with the unique "Alchemy", Alchemix explores a platform mechanism that allows customers to flexibly manage assets, making itself a part of the DeFi lego layer by layer, serving the complex DeFi Add a touch of mystery and fun to the wizarding world.
Join Us Here:
https://docs.google.com/forms/d/e/1FAIpQLSel53Un2E3WrVPCm5Niq3GpHjaYuZ7LdyJECdx-9qUWMpY-FA/viewform
About Us：
Twitter: @RealResearchDAO
Medium:
https://medium.com/@RealResearchDAO
Discord: discord.gg/ZSdgM7x6pc
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