Capital chasing Near Eco, will it be the next Luna?

Capital chasing Near Eco, will it be the next Luna?

Entering April, the public chainNearThe action is increasing, firstly, on April 6, it announced the completion of a new round of financing of $350 million to promote further growth of Near ecology; and then there is the news that Near will launch the native algorithmic stable coin USN.

Near's new funding round was led by Tiger Global, a traditional investment fund, with participation from FTX Ventures, ParaFi Capital and several other crypto investors. Not only has the public chain received funding, but several applications within its ecosystem have also recently received institutional investment, including decentralized trading app Trisolaris, lending app Burrow and Bastion, which shows how attractive the Near ecosystem is to capital.

Near (NEAR) was born to solve the scaling problem of ethereum by launching a high-performance block network built on the basis of sharding technology with infinite scalability, and this public chain is a typical representative of using sharding technology to improve scalability for blockchain.

More concerning to the crypto community than the funding is Near's plans for a stablecoin. This plan was first disclosed by Crypto Insiders, a media outlet in the crypto space, whose founder Zoran Kole wrote that NEAR will launch its native algorithmic stablecoin USN on April 20 and offer about 20% APR as the stablecoin UST of Terra chain (LUNA).

NEAR, the native pass-through of Near chain, has gone up to $20, up 69% in the past 30 days, which is a very bright increase in the overall decline of crypto asset market.

Following NEAR's rise is the value of crypto assets locked up on the Near chain (TVL), which has risen to $1.46 billion, up 1,69% in the last 30 days, ranking first among many Layer1 public chains in terms of TVL increase.

In addition to the rise of Near TVL brought by the news level, more importantly, the public chain broke through the previous development bottleneck at the end of 2021 - Aurora network came online. This scaling network built on Near blockchain changed the limitations brought by Near's incompatibility with ethereum in 2021, such as the difficulty of DApp migration and poor funding portal.

Currently, the Aurora development team is running independently. As it is compatible with EVM, it is convenient for developers to migrate their applications to the Aurora network without changing their code and then join the Near ecology. So far, the technical substrate of Near ecology has formed a parallel pattern of the main chain and the Ether-compatible Aurora network, opening up the interaction between a host of Layer1 networks such as Ether and other EVM-compatible networks and Near ecology, including developers and users of DApps.

What applications are currently available on the Near chain, which has been in development for 2 years? What is the progress of each of them? This issue of DeFi Honeycomb will take a look at them all.

Liquidity Pledge Agreement MetaPool

Metapool (META) is a liquidity pledge agreement (platform) in Near ecosystem, similar to Lido in Ether ecosystem, and its function is to help nodes or users to complete NEAR pledge, and at the same time to enhance asset liquidity and improve users' asset utilization.

Like many public chains, Near chain also adopts the PoS (Proof of Interest) mechanism, and the verifying nodes need to pledge the underlying pass NEAR to obtain the verification qualification to guarantee the stability and security of the network's block out, and the nodes can get the block out reward (NEAR).

In general, the higher the number of pledged passes (Tokens), the higher the trustworthiness of the verification node. Therefore, organizations that operate verification nodes often have the financial and technical strength to do so. When ordinary users take a share from the verification node, they often need to entrust their pass-through holdings to the verification node. This requires users to operate the delegation process on smart contracts by themselves, and also need to judge the reliability of the node by themselves, etc. This process increases the operation and knowledge cost of users.

In addition, users who pledge passes to nodes cannot redeem or circulate them for a given pledge period, and the only revenue they receive is a fixed share of the block reward. Within the larger blockchain financial system of DeFi, this reduces the efficiency of users' asset usage.

Metapool is here to solve the above pain points. Users can get pledge reward by pledging NEAR in this protocol, and the platform will move to match the NEAR pledged by users to the verification nodes. The pledging user gets the pledge certificate stNEAR in 1:1 ratio, and can get the pledge reward for holding stNEAR, and can also participate in the DeFi application on Near chain. To release the pledge, the user only needs to exchange the stNEAR for NEAR in the "stNEAR-NEAR" liquid pool provided by Metapool.

stNEAR and NEAR are released to users at a ratio of 1:1. Since stNEAR can be regarded as NEAR within the ecology and supports DeFi scenarios, such as exchange or lending, this is equivalent to releasing the liquidity of NEAR and improving the asset utilization of NEAR. In addition, the pledged NERA itself can also get the rewards given by Metapool. Currently, the annualized return obtained by users pledging NEAR on the Metapool platform is 11%.

Pledging NEAR earns 11% annual revenue.

META is a native governance pass for the Metapool platform that allows voting on the pledge yield share of the agreement. Earlier, users at Metapool could earn META rewards for the protocol's native passes in addition to the pledge yield. However, in February this year, the META portion of the pledge reward was suspended and META rewards are now only allocated to users who provide liquidity to the underlying asset pool (stNEAR-NEAR) exchanged with stNEAR.

According to Defillama data, the current value of NEAR pledged on the Metapool platform is $126 million.

One-stop DeFi platform Ref.finance

Ref.finance (REF) is the first decentralized AMM (automated market maker) trading application on the Near main chain, first launched in April 2021 and officially supported by the Near Foundation.

Ref.finance aims to build a one-stop DeFi platform that integrates trading, lending and Near eco-asset issuance. The platform went live in December 2021 with a stablecoin exchange pool feature that supports users to quickly exchange stablecoins with minimal slippage and fees.

Ref.finance

Unlike previous DEXs, Ref.finance is optimized for asset redemption paths. It has a built-in "aggregated transaction feature" that integrates transaction data from DEX liquid pools on Near and Aurora. With the smart path feature, the application automatically finds the best redemption path for asset redemption users, including splitting a transaction into multiple pools, or a transaction that contains multiple fulfillment processes, etc.

For example, when converting 100 NEAR to USDC, the transaction may be split into two parts in order to help the user find a low slippage conversion path at times, where 90 NEAR is converted to DAI first and then from DAI to USDC, with a path of NEAR-DAI-USDC, while the other 10 NEAR may be converted to USDT first and then to USDC, with a path of NEAR-USDT-USDC. The path is NEAR-USDT-USDC.

REF is a native pass-through of Ref.finance with a total issuance of 100 million. Currently, users can earn REF rewards by providing liquidity to the platform's liquidity pool.

According to Defillama data, the Ref.finance app currently has a TVL of $208 million and a REF provisionally quoted at $4.

The most traded DEX Trisolaris

Trisolaris, the TVL and most traded decentralized trading application (DEX) in the NEAR ecosystem, runs on the Aurora network and is the first DEX on the network. the DEX primarily supports native asset exchange on the Near and Aurora networks and supports all EVM-compatible Layer1 public chain assets across chains to Aurora network.

Trisolaris page

It is important to note that Trisolaris is built on the Aurora network and the GAS fee paid for its use is ETH, which means that users can enter the Near ecosystem as long as they have ETH, lowering the threshold for participation in the Near ecosystem.

On April 3, Trisolaris received a $4.5 million strategic investment led by Electric Capital, which officials said will be used to expand the team and continue to invest in key products.

According to Defillama data, the current TVL for the Trisolaris application is $289 million.

Pool lending platform Burrow

Burrow (BRRR), which went live on March 29, is a decentralized lending platform on Near's main network where borrowers and lenders transact through a liquidity pool, with the interest rate for each loan and borrowing determined based on changes in the pool's supply and demand, similar to Compound, a lending protocol on Ether.

Burrow aims to improve the utilization of users' funds by unlocking the liquidity of "interest-bearing assets". An "interest-bearing asset" can be simply understood as an income-producing asset, usually obtained by locking in a chain of native assets. You can think of it as a certificate of deposit or receipt obtained from a native asset as a result of a lock-up, or some people refer to it as Tokenization of an "interest-bearing bond".

Burrow allows users to convert their "underlying assets" into interest-bearing assets first and supports interest-bearing assets as "collateral" to lend out other assets, improving the efficiency of capital usage by leveraging interest-bearing assets in a revolving lending process.

If users hold NEAR, they can first pledge it as stNEAR in Metapool platform and earn about 11% interest per year; then deposit stNEAR in Burrow for interest income, or use stNEAR as collateral to lend other assets.

Burrow Savings and Loan Income

Like Aave, a lending application on Ether, Burrow uses "overcollateralization" to maintain the safety margin of assets and keep them in a healthy range. For the collateralization rate of each asset, Burrow introduces the concept of asset volatility, which means that each asset has a range of price fluctuations belonging to its own characteristics, and then calculates the volatility based on the range of price fluctuations. When other factors are stable, the utilization of funds is lower when assets with higher volatility are used as collateral assets.

On March 29, Burrow announced its launch on Near's main website, and the following day announced the completion of a $5 million round of funding from Dragonfly Capital, ParaFi Capital, IOSG Ventures and others.

Currently, Burrow supports users to deposit assets such as NEAR, stNEAR, ETH, USDC, USDT, DAI and wBTC to earn interest, or to lend needed assets as collateral.

As of April 21, there were $432 million in deposits and $281 million in borrowings in Burrow.

Lending application Bastion

Bastion is a lending application built on the Aurora network, where lending rates are determined by the supply and demand of assets in the pool.

It is similar to Compound in that users who deposit crypto assets receive a deposit credential, cToken. cToken is also equivalent to an interest-bearing asset. As the interest income from the underlying asset increases over time, then the higher the value of the cToken. When the user redeems the cToken back into the underlying asset, he or she will receive more of the underlying asset than was initially deposited. When borrowers want to lend other funds, they need to first deposit crypto assets into cToken and then use the cToken as collateral to lend out the required assets.

While Bastion is similar to Compound in terms of lending mechanism, it has again improved the user experience in terms of product features. It has gone live with a stablecoin exchange pool that supports low slippage exchange of stablecoins, cToken, encapsulated assets, and pledged assets. Users can realize the process of lending and trading on one platform, Bastion.

Users can earn interest income by depositing assets on the Bastion platform, or they can combine deposit certificates cToken with similar assets to provide liquidity to earn transaction fees.

For example, Xiao Ming holds NEAR. in the previous lending agreement, Xiao Ming can deposit NEAR to obtain deposit certificate cNEAR. at this time, cNEAR is either used as collateral for lending other assets or can be continuously held to obtain interest income from depositing NEAR. However, in Bastion platform, Xiao Ming can first exchange NEAR into pledge certificate stNEAR, then deposit stNEAR to Bastion to obtain cstNEAR, and the held cstNEAR can be paired with similar asset groups related to NEAR, such as cstNEAR-stNEAR, cstNEAR-cNEAR, cstNEAR- NEAR, etc., and then provide liquidity to these asset pools for a liquidity bonus.

In this way, Xiao Ming's underlying asset, NEAR, is "multi-purpose" and earns triple income from pledge proceeds, deposit interest and transaction fees at the same time, improving the utilization of funds.

Bastion Operating Data

Bastion went live on March 7 and announced on March 23 that it had closed a round of funding led by ParaFi Capital with participation from DCG.

Bastion does not use the usual "airdrop" method of the previous DeFi protocol, but the "Lockdrop airdrop" form, which means that users need to lock assets into Bastion first, and the lockdrop time is 1-12 months. After expiration, you can get BSTN rewards and get back your original assets. The longer the lock-up time, the more BSTN you will get. This kind of airdrop method curbs the wool party and leaves enough time for the platform to accumulate TVL.

The launch of Bastion's lock-in airdrop attracted a large amount of funding, creating a funding 'suck' effect on other lending apps, and at one point propelled it to the top of the Near eco-app in TVL.

The current value of deposits in Bastion is $428 million, and on April 21, the app announced the launch of BSTN and will begin trading on Trisolaris the following day.

Lending platform Aurigami Finance

Aurigami (PLY) is a lending application that runs on the Aurora network and allows users to use it to earn interest on deposits or lend crypto assets, with lending rates that also change at any time based on the supply and demand of assets in the pool.

In the Aurigami app, depositors who deposit crypto assets receive a deposit credential auToken, which is also an interest-bearing asset with which users can withdraw the deposited assets on demand. In addition, the AuToken is tradable and transferable. Borrowers who want to lend assets on Aurigami need to deposit assets backed by the platform as collateral, but of course, it is also over-collateralized lending.

Aurigami Lending Data

Aurigami is an early lending app in the Near ecosystem. On February 6 of this year, the app announced that it had received investment support from crypto-renowned venture capital firms such as PolychainCapital, Alameda Research, and CoinbaseVentures for an undisclosed amount.

In addition, during the period of April 22-May 6, Aurigami will open a NEAR (approximately 145,000) super reward worth $2.5 million, where users can deposit crypto assets on the platform and receive NEAR rewards in addition to interest income, with varying weighting of reward allocations for each lending pool.

This move is more like a counter-measure to Burrow and Bastion, the latecomers in the lending circuit. Thus, the battle for TVL, the lending app on Near chain, will continue.

Aurigami's total deposits are currently valued at $200 million and total borrowings are valued at $97 million.

Article source: Gyrotech Article author: Hive Finance NEWS