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A new power of lending: Is Solana's lending project worth waiting for?

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Solana chain itself high performance characteristics, as well as the ability of capital operation, its TVL rapid growth.

原文来源：ViaBTC Capital Insight

新起之秀——Solana

According to the statistics of public information, Solana ecology has covered DeFi, tools, infrastructure, NFT, games, DApp applications and other fields. There are nearly 190 DeFi projects alone (incomplete statistics) : & NBSP;

(photo: Solana Daily, https://twitter.com/solana_daily/status/1475821382432923650)

The rudiment of Solana ecology has been formed, with a hundred flowers blooming and more and more comprehensive subdivisions. According to the figure above, DeFi field is the most developed track in Solana ecology so far. It covers DEX, lending, futures and options, liquidity solutions, aggregators, synthetic assets, prophets and other categories and infrastructure service products.

The importance of lending in a corporate ecosystem

Capital and flow entry: For the new public chain, lending is the bottom source of liquidity in its financial ecosystem, because for the cryptocurrency holders, they can obtain tokens they do not have for liquidity mining. It's all based on the premise that they don't have to sell any crypto assets. At the same time, lending on a new public chain is a big entrance to attract traffic. Many new online lending projects will attract new users to provide liquidity through air drops and other ways, thus attracting a large number of DeFi "Smart Money" to this new public chain. In addition, lock warehouse quantity (TVL) is also one of the key indicators of the major public chain competition.

Polygon's rapid rise is related to the fact that it attracts major lenders to its ecosystem. For example, THE TVL AAVE brings to Polygon accounts for about 45% of its total TVL. The access of AAVE has brought a lot of traffic to Polygon, and the TVL of the entire ecosystem has increased. Benqi is the largest project in the avalanche protocol ecosystem. According to DeFi Llama's data, its TVL has accounted for 13.7% of the total TVL of avalanche protocol. From this, it can be seen that lending is particularly critical for a new public chain to attract attention and capital quickly.

Uniqueness of Solana's public chain: Similarly, how important is the lending sector in Solana's ecosystem? Unlike EVM-compatible chains such as Polygon and Avalanche, Solana is not physically compatible with the Ethereum Virtual Machine (EVM), in the Solana ecosystem that currently cannot easily migrate existing leading lending projects on Ethereum. As a result, Solana's lending programs are almost all native projects. Moreover, Solana claims to be the fastest blockchain in the world, with high throughput as one of its major features, currently up to 50,00tps on the chain. Efficient computing rates directly reduce the cost of on-chain transactions, typically 0.000005SOL, which is negligible. This feature of Solana is ideal for landing high-frequency blockchain applications such as DeFi and chain games.

It is worth mentioning that thanks to the crazy expansion of Solana Ecology, its TVL grew by nearly 300% from April to December this year. Finally, Solana TVL also hit an all-time high, as of today (December 27, 2021), its TVL has reached $12 billion. The top protocol on Solana is Raydium, a decentralized trading platform, with 13.43% TVL share.

Loan program on Solana

1. Port Finance

Port Finance is an unmanaged liquidity agreement on Solana that offers innovative lending and interest rate derivatives. They plan to offer a basic lending agreement that will allow users to take leveraged positions; Then provide the function of fixed interest rate loan, so that users know the interest amount; Then, create an interest rate swap market between fixed and floating rates for users to hedge interest rate risk. As of Dec. 29, its TVL was about $138 million.

High quality Capital endorsement: The seed round was led by Jump Capital, with participation from Rarestone Capital, Raydium, Solanium and others, raising $1.2 million.

Evaluation: The first lending agreement on Solana, offering innovative lending and interest rate derivatives, has won the Solana Season Hackathon Competition Award and has been endorsed by top investment institutions.

2. Oxygen

Oxygen Protocol is an on-chain master broker service Protocol built on the scalable Solana blockchain and added to the rapidly growing Serum ecosystem.

Top investor endorsements: The strategy round was led by Alameda Research, with other well-known Capital and holding companies including Multicoin Capital, Genesis Capital and CMS Holdings participating.

Evaluation: The team has strong comprehensive background and rich experience in traditional brokerage and cryptocurrency industry. Compared with the valuation peak in October (about 22 billion), the total market value of the project is about 10 billion DOLLARS, which has decreased by 50%. The Token circulation is still about 1%.

3. Larix

The lending protocol on Solana's blockchain uses a dynamic interest rate model to create a more capital-efficient risk management pool that safely leverages a wide range of collateral types.

Recently completed private and seed rounds of financing, including Solana Capital, Huobi Ventures, Gate, MXC Global, BitMart, Fenbushi, Polygon, FBG, etc. From the investor lineup, mainly trading platform and public chain ecological fund. As of Dec. 29, its TVL was about $176 million.

Evaluation: Won the first place in Solana Hackathon Asia quadratic vote, is the first to adopt the dynamic interest rate model in Solana ecology, investment institutions are also good.

4. Jet Protocol

Jet Protocol is a lending Protocol built on the Solana blockchain, focusing on innovative lending products and cross-chain interest rate arbitrage.

Good investors: Alamenda Research, SMS Holdings, unknown amount.

Evaluation: Good community popularity: Around 15,000 followers on Twitter; Medium has 15,000 followers; For Solana ecology, the product is somewhat innovative.

Why do these lending programs run on Solana?

This is due to the high performance of Solana chain itself, 65,000 transactions per second, 400ms block time, low transaction costs, strong security and developer-friendly environment, and of course, capital operation ability. Strong capital endorsement also attracts a large amount of capital flow to Solana ecosystem. Make its TVL increase rapidly. In addition, multiple stablesoins help make Solana's lending platform more attractive as a stable store of value, and stablesoins make DeFi lending apps more available to the masses. Mature stablecoins are essential for a strong, sustainable and mature ecosystem, and the number of Solana integrated stablecoin projects continues to grow, such as Tether (USDT), which launched in 2020 as the first stablecoin on Solana, This is a huge boon for the Solana ecosystem, in addition to Circle's USDC, which launched on Solana in January 2021, and many stabecoin projects such as Terra, Parrot, UPFI, and more.

Summary & have spent

Solana is still a very new public chain, and there is still a lot of room for growth. It needs more developers and innovative projects to build on it. For its follow-up development, especially the loan projects as the source of liquidity at the bottom, it is worth looking forward to! However, whether Solana can take off depends on whether Solana ecology can grow in addition to high performance and safety. Ecology cannot grow only with loans, and it needs to grow together with other types of projects.

(The related projects mentioned above do not constitute investment advice)