vfat Conversation with Aladdin DAO
Primer: Aladdin DAO invites vfat, the founder of Hundred Finance, to their Boule Research Meeting on 3 February 2022. He provides an update on Risk Harbor, introduces Hundred Finance to listeners, and responds to queries from the floor.
The Solana Bridge Hack
One of the Solana bridges was hacked
There will be a bailout and that user funds are safe
If there are exploits in DeFi, it is expected that funds would not be recoverable
It is good for users that VC chains step in, but this creates a precedent for intervening in the future
Update On Risk Harbor
Version 2 is a massive overhaul of version 1
Main difference is that there’s only 1 vault now. Previously, there was 1 vault for each strategy
The vault is incentivized with 15,000 RHxT. This could be redeemed for the RH token in the future
The strategy is to deposit USDC in their vaults to receive rewards from underwriting. The rewards are not inclusive of RH rewards yet
Hundred Finance
A multi-chain lending platform based on Compound
The main thing they altered is the reward model
They have already launched on Arbitrum, Fantom, Harmony, and Moonriver
They will be focusing on the smaller chains before moving on to the bigger ones
They use Chainlink Oracle price feeds. Hence, they are limited to launching on chains that are integrated with Chainlink
Will be launching cross-chain governance where holders can lock their HND for veHND on one chain and use it on another chain
Changes made to their reward model:
Do not allow recursive borrowing/lending
Only incentivize stablecoins
💡 Example of recursive borrowing/lending: Supplying Asset A —> Borrow Asset B —> Sell Asset B for Asset A —> Supply Asset A again —> Repeat the process
They focus only on stablecoins
Their Staking System
Holders can lock their HND for veHND for up to 4 years — similar to Curve’s system
veHND holders can vote on which stablecoins to receive more rewards. Holders could get a boost of up to 250% compared to non-holders
In the future, veHND will be used to govern the entire protocol
They tried to distribute the token to as many chains and people as possible
Normal tokens are not suitable for cross-chain governance because they are transferable
They have finished the contracts for mirroring. Mirroring works by copying one’s veHND position from every chain to a smart contract
Example:
100,000 veHND on Ethereum
50,000 veHND on Arbitrum
Total of 150,000 veHND on both chains
Future Chains They Will Be Launching On
Optimism and Gnosis (formerly xDai) are coming up next
IoTeX is possible if they use the Chainlink proxy solution
After the launch of mveHND (mirror version of veHND), they will probably launch on Ethereum, followed by Polygon, BSC, and Avalanche
Strategy For Aladdin DAO
Aladdin DAO can act as a Yearn/Convex on top of Hundred Finance’s gauges
They can gather HND, lock it up, and boost their own pools
Users can deposit through Aladdin DAO so that they can get the full boost without locking HND themselves
How Does Their Cross-Chain Governance Work?
Each chain has its own governance that's governed by the veHND on that specific chain
Hence, holders cannot vote on Ethereum to affect something on Polygon
Mirroring works to display the user’s tokens so that they have the same amount on every chain
Mirroring involves using a bridge to do message passing from one chain to another chain (e.g. “I have 50,000 veHND that expires on this date”)
For each chain, the team will be doing the distribution manually (e.g. on a given chain, how much is going to each stablecoin)
Example:
Distribution on Fantom is 100,00 a week
People vote on Fantom as to how much goes to MIM, USDC, etc.
Their Token Breakdown
Total supply of 100 million
20 million to the dev fund, vested for 4 years
20 million to Compound Finance because their code is based on theirs. This is vested over 4 years
20 million to Percent Finance, because Hundred Finance is version 2 of the former. 1 PCT could be swapped for 1 HND, with 10% claimable up front and the remaining 90% vested over 1 year
40% to liquidity mining and partnerships
There are no seed investors at all
How Different Is Hundred Finance Compared To Other Lending Protocols?
They have a unique liquidity mining system
Executing very quickly compared to the larger players
They are serving newer and smaller chains
They will be among the first to implement cross-chain governance
Will be implementing cross-chain lending in a few months. Users could put their collateral on one chain and borrow on another chain
Will They Allow Protocols Like Convex To Lock Up Their HND Tokens?
They don’t have anything against Convex
The problem with Convex is that they grew too big, too quickly and no one can compete with it
They will have multiple “Convexes” doing the same thing so that no one of them will grow too big compared to the others
There are a few projects that are looking to buy HND and to offer vaults
There will be 40 million HND tokens that are available for liquidity mining over 4 years
Currently, they have 30-40% of circulating supply locked up as veHND with an average lock duration of 2.5 years
Which Chain Has The Most Traction Right Now?
Fantom has been growing crazily because of Solidly
Hundred Finance is one of the top 20 projects on Fantom
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.