As DeFi consumers switch platforms in search of higher returns, 2.0 protocols become increasingly important for long-term value.
In the year 2020, decentralised finance (DeFi) become a global phenomenon. Two years later, the world has learned about a number of successful DeFi projects. Despite these achievements, like with any new subject, a number of issues have arisen.
Consider the difference between Bitcoin (BTC), which introduced the world to cryptocurrencies and blockchain but could only be used for payments, and Ethereum (ETH), which expanded the universe of technology use cases. In the same way that DeFi 1.0 introduced new earning opportunities and liquidity difficulties when users switched platforms in search of better rewards, DeFi 2.0 protocols are attempting to provide more stable value with more advanced principles.
LeoFinance, a team that has been developing and managing applications for the past three years, is helping to usher in this era. LeoFinance and LeoMobile (for iOS and Android), for example, are social apps that serve as the backbone for the team’s bigger ambitions.
LeoFinance spent seven months investigating the next generation of solutions, DeFi 2.0, taking note of the decentralised autonomous application (DAO) revolution and platforms like Olympus, after successfully building applications on Binance Smart Chain (BSC) and other platforms (OHM). They wanted to use their results to help others “the critical ingredients for success,” and apply them to their platform goals, which include “building a sustainable DeFi 2.0 Yield Application on the Polygon blockchain for our community of diamond paws,” according to one of their team members.
“With the LeoFinance Web3 Ecosystem, our ultimate goal is to broaden and deepen our community.” Width refers to attracting more users, while depth refers to creating ever-increasing levels of potential to enhance our users and generate wealth for our community.”
The LeoFinance team has created PolyCUB, a new app, with this objective in mind. PolyCUB aspires to improve tokenomics and mechanics over existing DeFi yield optimisers while also introducing community members to new Polygon blockchain options (MATIC).
PolyCUB ensures long-term viability by utilising Kingdoms, a cross-platform yield farming vault that allows users to earn through both the local platform’s Base APY and POLYCUB APY.
POLYCUB’s underlying scarcity model ensures long-term earning sustainability in this model. The app’s token works in a similar way to Bitcoin in that it isn’t a means of trade. POLYCUB, on the other hand, has value directed at it, ensuring that the required deflationary pressure is applied in distribution. As a result, xPOLYCUB is an excellent choice for investors who intend to store their assets for a long time.
In effect, everyone staking POLYCUB as xPOLYCUB in a single staking pool will have an asset that is constantly deflating. The value of xPOLYCUB against POLYCUB is increasing all the time (10.71 PC per xPC at press time). Early harvesting penalties produced by external capital (TVL) in Kingdoms vaults are claimed by xPOLYCUB.
The platform’s tokenomics redistribution ensures even more value. Kingdoms, as previously noted, allows users to stake various tokens and receive yield via auto-compound returns, letting users to raise their earnings with little work. The rewards are split 90/10, guaranteeing that 10% of the revenues go toward the xPOLYCUB contract.
The platform also employs a harvesting penalty approach based on a curve. Users can choose to wait 90 days for their harvests to “unlock” and become claimable, or they can claim them immediately and pay a 50% early-harvest penalty to xPOLYCUB holders.
This functionality is combined with Protocol Owned Liquidity (POLYCUB Bonding) and a 10% management charge on Kingdoms yield. When these features are combined, they assure that the price will rise in USD terms over time, and that value will be funnelled into the hands of anyone staking xPOLYCUB in a way that DeFi 1.0 systems do not.
Creating the mechanisms for growth
LeoFinance is now focusing its efforts on growing its Web3 ecosystem to new blockchains of opportunity like Polygon, with a community of thousands of monthly active users worldwide, including bloggers, readers, and Web 3.0 users.
PolyCUB, their programme, takes OHM-inspired bonding mechanics and combines them with xPOLYCUB’s Curve-style staking to build a long-term yield optimizer.
The team feels they are ideally positioned to create long-term success in an industry that lacks long-term thinking by leveraging their well developed mechanics.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.