Polygon Alpha Podcast - Cross Chain DeFi Borrowing Aggregation | Fuji Protocol | Boyan & Daigaro
Primer: Have assets on one chain and need to borrow on another chain? Fuji Protocol is a cross-chain borrowing aggregator that allows you to do just that. In this episode of Polygon Alpha, host Crypto Texan dives deep into Fuji Protocol with Daigaro and Boyan.
Background
Daigaro
Professional background in aerospace engineering
Knew about crypto since 2014
When he found out about DeFi in 2020, he got hooked
Boyan
Used to be the CTO of a B2B Web2 startup
Had worked in a bank before
Fell in love with DeFi because it’s the intersection of his 2 passions: finance and technology
Meeting Each Other
Met each other through an online hackathon
Looking for teammates and came up with the idea of Fuji
Fuji Protocol
Why Is Fuji Needed?
Enables people to use their assets as collateral for a loan
Longer-term, Fuji provides users with credit line access to whatever they want in real life
Fuji helps to automate the borrowing/lending experience for users
Is It Difficult To Build On DEXes/Lending Protocols?
It has its challenges
It has to be optimized continuously to ensure that users pay the least borrowing cost or have the best APR
Which Protocols Do They Support On Polygon?
Aave V2 and V3
Will be aggregating other types of markets in the future
In the future, users can take out a loan in a particular stablecoin but pay the interest in another stablecoin
Their Architecture
Designed it in pairs of collateral/assets
Uses the ERC-4626 standard
What Does Fuji Do With Farmed Tokens?
They have to account for it when selecting one protocol over another
The farmed token is sold for more collateral and compounded into the pool
Fuji V2
Will be enabling multichain transactions in a single transaction (e.g. lend on chain A, borrow on chain B)
Built a proof of concept for it called the DApp teleporter in the Amsterdam hackathon
Works similarly to a flash loan across different chains
How Are They Leveraging the ERC-4626 Standard?
ERC-4626 uses a shares system
The number of shares in a pool is fixed
Transferring shares between chains is easier than transferring the current debt balance or collateral balance plus interest
The functions are standardized, enabling it to be composable
How Are They Leveraging The EIP-712 Standard?
EIP-712 is a standard that allows signing messages for smart contracts that are readable to the user
When users are sending messages cross-chain, they need to know who is the message sender that they can trust
This enables the receiving chain to do actions on behalf of the user, saving the user additional transactions on the other chain
Thoughts On UI/UX
Their philosophy is to use UI/UX to abstract away as much complexity as they can
The biggest advantage of Fuji V2 is that the bridging logic is baked into the app itself
Their focus is on presenting all the important information to the user
Will They Have A Token?
Focused on their product first
Once their product has traction, then would they consider having a utility token
How Do They Generate Revenue?
Charging 1% on top of their optimization as revenue
Haven’t set anything in stone yet
Planning to add services on the side that adds value
The Roadmap
Their user research revealed that liquidation protection is something that is requested
For their V2, they are partnering with Connext to make cross-chain calls
Where Can People Go To Find Out More?
Follow their Twitter account
Join their community on Discord
All information presented above is for educational purposes only and should not be taken as investment advice. Summaries are prepared by The Reading Ape. While reasonable efforts are made to provide accurate content, any errors in interpreting and summarizing the source material are ours alone. We disclaim any liability associated with the use of our content.