#AnchorProtocol 101: #Terra's stable yield borrowing and lending platform
Here's your intro guide to Anchor, the stable yield borrowing and lending platform on #Terra
A thread👇🧵
Here's your intro guide to Anchor, the stable yield borrowing and lending platform on #Terra
A thread👇🧵
2. #AnchorProtocol is a savings protocol launched by Terraform Labs on #Terra.
It allows instant deposits and withdrawals, with the option to earn low volatility interest rate, which is the highest amongst stablecoins at ~19.5.
It supports $LUNA and $UST tokens.
It allows instant deposits and withdrawals, with the option to earn low volatility interest rate, which is the highest amongst stablecoins at ~19.5.
It supports $LUNA and $UST tokens.
3. Although #DeFi has been popping off, it is not particularly user friendly. Staking is not an option for many because of the volatility.
4. Most #DeFi protocols have diminishing rates. There was a need for a protocol that gave consistent, decently high rates.
Enter @anchor_protocol.
Enter @anchor_protocol.
5. #AnchorProtocol does this in a couple of ways:
bAssets are liquid tokens that can be exchanged for staked assets.
Users transact with bAssets in they same way that they do with their staked asset.
bAssets are liquid tokens that can be exchanged for staked assets.
Users transact with bAssets in they same way that they do with their staked asset.
6. Essentially, users earn rewards on their staked assets, while having liquidity.
The Money market is a mechanism that allows the borrowing and depositing of UST stablecoins.
The Money market is a mechanism that allows the borrowing and depositing of UST stablecoins.
7. Essentially, a pool of $UST is deposited.
Borrowers can borrow easily as long as they put up assets as collateral.
The interest rate is calculated using an algorithm based on borrowing demand and supply
Borrowers can borrow easily as long as they put up assets as collateral.
The interest rate is calculated using an algorithm based on borrowing demand and supply
8. Borrowing money is extremely simple. One just has to put up collateral.
Based on how much collateral is put up, #AnchorProtocol calculates how much the borrower can borrow, which is up to 50% of the value they put of for collateral.
Based on how much collateral is put up, #AnchorProtocol calculates how much the borrower can borrow, which is up to 50% of the value they put of for collateral.
9. Anchor uses a liquidation process to ensure that borrowers don’t run away with the money.
Deposits are secure as long as any obligations secured by them are over-collateralized.
Deposits are secure as long as any obligations secured by them are over-collateralized.
10. Anchor keeps deposits safe by paying off debts that are in danger of failing by converting the put up collateral.
Depositors deposit $UST stablecoin. Given that it is a stablecoin, it avoids the volatility of unpegged currencies.
Depositors deposit $UST stablecoin. Given that it is a stablecoin, it avoids the volatility of unpegged currencies.
11. Those who want high risk and high rewards can join the anchor liquidity pool that funds debt holdings.
$ANC is Anchor’s native token. It has a total supply of 1B.
$ANC is Anchor’s native token. It has a total supply of 1B.
12. #AnchorProtocol has been getting a lot of attention and it’s easy to see why. T
hey are solving one of the biggest problem that plagues #DeFi - unstable, volatile, high risk rates, through its stable interest rate.
hey are solving one of the biggest problem that plagues #DeFi - unstable, volatile, high risk rates, through its stable interest rate.
13. Additionally, in traditional finance, borrowers face super high interest rates and lenders get almost nothing.
Anchor has done away with the bank and instead allows lenders and borrowers to directly interact with each other, providing a better experience for both parties.
Anchor has done away with the bank and instead allows lenders and borrowers to directly interact with each other, providing a better experience for both parties.
14. Anchor's stable interest rates will last a long ass time. Check out @Remi_Tetot's tweet:
https://twitter.com/Remi_Tetot/status/1502832526640832515
15. Accounts to follow for $ANC insights:
@Remi_Tetot @Gojo_Crypto @TerraPico_ust @cryptobcncat @PeterTheTerran @CryptoGanster @DefiMikeSotero @CryptoWizardd @Cephii1 @Shigeo808 @Terrians_ @crypto_pb @jwang815 @ReySantoscrypto @TheRyanLion @WestieCapital
RT would mean a lot!
@Remi_Tetot @Gojo_Crypto @TerraPico_ust @cryptobcncat @PeterTheTerran @CryptoGanster @DefiMikeSotero @CryptoWizardd @Cephii1 @Shigeo808 @Terrians_ @crypto_pb @jwang815 @ReySantoscrypto @TheRyanLion @WestieCapital
RT would mean a lot!
16. Accounts to follow for $ANC insights:
@davey_0602 @ceo100x @krypto_scalper @DetectiveGrover @anchor_protocol @mcantieri @Dan_Nice14 @TerraLUNADaily
An RT would mean a lot!
@davey_0602 @ceo100x @krypto_scalper @DetectiveGrover @anchor_protocol @mcantieri @Dan_Nice14 @TerraLUNADaily
An RT would mean a lot!
17. Hope that was insightful. I regularly post 101s and breakdowns, follow to keep up. An RT would mean a lot!
Here are some of my past 101s:
Here are some of my past 101s:
https://twitter.com/Cov_duk/status/1500714387417436168
Correction: it's 80%**
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