Optim Finance

Numerous financial strategy based and smart contract managed pools allow users to optimize their yield potential from whitelisted Cardano defi protocols.

Users of the Optim protocol deposit their assets into pools called vaults. These pools of funds are invested by smart contracts that are coded with one or more investment strategies and designed to allocate and reallocate funds to maximize the assets yield potential. Each vault deals with a different element of yield generating Cardano DeFi.

Finance strategists, purportedly community members, develop the strategies which the vaults work on. Then, pultus developers take these strategies and code them into smart contracts. The idea is that, in the future, this whole process will be decentralized through the community governance of the platform, a DAO. Financial strategists who’s proposals are successfully enacted will be entitled to a portion of the vault fees associated with their strategy.

The strategy smart contracts for each vault are publicly available for viewing on blockchain explorers

Vault Mechanics and Types

Each vault has at least one strategy associated with it, with most having more than one. The reweighing of asset deployment by the vault’s smart contracts will be computed off-chain and informed by oracles.

Upon depositing assets, users are given oVault tokens which represent their contribution to that particular vault and any yields earned. Each specific token deposited has its own representing token i.e. ADA deposited in a vault is represented by a token called oVada. These tokens are returned and burned when users withdraw their funds. These tokens, being Cardano native tokens, are tradable on the open market.

Vault Types

Single Asset Vaults: These deploy funds to multiple pools and yield farms across the ecosystem and only contain on type of asset e.g. ADA.
DEX LP Vaults: Funds are used to create liquidity positions on DEXs to maximize yields. Users can set parameters for their assets to avoid impermanent loss, and can choose between two auto-compounding and governance token withdrawal ratios, 50/50 and 75/25.
LenderOps: Funds deposited here are used on whitelisted lending protocols, optimizing yields in the form of interest paid to the user.
KeeperOps: Uses funds to take advantage of arbitrage and similar opportunities, such as borrower liquidation, across Cardano’s defi ecosystem. When opportunities are low idle assets are staked or lent out on whitelisted lending protocols to accrue interest.
StakerOps: Users can set parameters for their deposited ADA, and funds are then managed to optimize staking yields within the user’s set parameters. Users can diversify their stake into other tokens and even enter yield farming opportunities. The fees for using StakeOps are half of the normal vault fees.

Funds are immediately redeemable at any time if they are not in time-locked vaults. Time-locked vaults are aimed at longer term investors, 6 months, a year or longer, and services fees will be lower for time-locked vaults.

Fees Structure

These are the preliminary fees posted in Optim’s whitepaper V1, and are subject to change before protocol launch.

Deposit Fee: 0.05%
Withdrawal Fee: 0.2%
Performance Fee (unlocked vaults): 5%
Performance Fee (time-locked vaults): 3%
Mangement Fee: 1.5%

Vault Management

Bots will manage the elements of the vaults that aren’t programed into the smart contracts, such as: selling reward tokens, reinvesting rewards, managing collateral, and other vault housekeeping tasks. The management of these bots will be open sourced to community members. In exchange for managing these bots the bot manager will receive the platforms utility token, OTM.

Each vault has two individuals designated to be its overseers who have the authority to make adjustments: a custodian and a strategist. The strategist is the one who created the vault, and the custodian is community selected. They share maintenance privileges, reviewing and conducting the changes recommended by the vault’s bot “housekeeper”. A multisig wallet is used to execute changes to the script that manages the vault's funds.

Contract Audits

All contracts deployed for yield strategies will go through an “extensive audit and review process”. Which goes as follows:

A contract is analyzed by internal smart contract engineers and security experts. Neither of whom contributed to coding said contract.
The contract is then reviewed by the audit team at mLabs.
The contract is then forwarded to unaffiliated third party auditors for review.

Optim is in talks with two audit firms to have them on a retainer. Meaning that future smart contracts can be audited quickly and their implementation can be completed in a timely manner.

OTM: A Utility Token

OTM is the platform’s governance token that is distributed to users of the protocol. Users will receive OTM tokens for:

Creating and using Optim’s vaults
Being bot operators and vault keepers
Participating in staking and governance

Users can stake OTM tokens to vote and simultaneously accumulate more OTM tokens by doing so. Tokens that are staked for longer have a higher weight when it comes to voting. Users who have more OTM tokens will also have a higher voting weight.

A proposal will need to achieve the support of 4% of all the issued OTM tokens to be eligible to be debated by the community. To be approved for adoption on the platform the proposal only needs to get enough “for” votes to outweigh the votes “against” it.

After full decentralization has occurred, i.e. full control of the platform has been handed over to a DAO managed by OTM holders, these holders will also be able to vote to change the dynamics of the protocol’s treasury. These OTM holders will vote to create oTeams, much like a democratic society votes in members of government.

These oTeams will conduct changes and improvements that fulfill the outcome of votes. There are multiple proposed oTeams, each independent and dealing with a different part of the protocol.

Unlike many other projects Optim have gone out of their way to plan an in-depth DAO structure. Helping to stabilize the democratization of improvements to the platform and ensure that the security of the platform is difficult to compromise.

Concurrency?

Concurrency is an issue each and every Cardano defi platform, or any platform that has a busy smart contract, will have to deal with.

Optim’s concurrency solution is yet to be detailed but their whitepaper teases a batching solution that will effectively manage moments when users try and withdraw from a vault simultaneously.

Oracles will either come from Chainlink or be built by the Optim team.

Industry

DeFi

Investment Management

Lending Protocols

Lending protocols in the DeFi world allow people to loan or lend money in a peer-to-peer manner, i.e. without the banking middleman. These loans are secured by the lender over-collateralizing the loan and the terms of the loan being managed in a smart contract. This gives the unbanked or those who have poor credit the ability to take loans, and it gives those with excess capital the opportunity to provide loans in a secure and trustless manner, and to earn income from them.

Over-collateralization means that the person receiving the loan locks up more than the value of the loan to secure it e.g. if they want to loan 100 they must lock up 150. How much they over-collateralize the loan by, and which tokens they use as collateral, depends on the platform. Some platforms only accept stablecoins, and other accept a variety of crypto assets. Typically, an individual uses one asset for collateral and takes a different asset as their loan.

An important factor in all loans is the interest rate and the length of the loan. These vary greatly by lending protocol, and loans can have fixed interest rates and periods, or infinite periods with interest rates that fluctuate throughout the loan period, fluctuating based upon the utilization rate of the pool of funds the loan was drawn from.

Importantly, the receiver of a loan is expected to maintain a certain ratio of collateral to loan, meaning that if the value of their collateral drops below that of their collateral to loan ratio, they need to add more collateral to keep the required balance. If they don’t keep up the collateral ratio they face liquidation and the loss of their collateral.

To "become the bank" those with idle tokens can deposit them into a lending protocol and earn from the interest derived from the loans their tokens are used to facilitate. Usually this deposit requires a lockup period of a certain length of time. Often, the longer the lockup period the higher the percentage return for the depositor.

Explorer

MYTH

Blockchains are a secret way of transacting money and hiding the exchange of funds from others and authorities.

TRUTH

A blockchain is a transparent ledge, meaning that anyone can explore the transactions on it when given the tools. Those tools exist for all blockchains (except the few privacy chains that have been created that do in fact hid the exchange of funds).

Explorers allow anyone to search and explore all the transactions on the blockchain. The blockchain can be searched and explored in numerous ways using: wallet addresses, transaction IDs (TX ID), block numbers, epoch number, slot/epoch number, stake pool ticker, token ticker, staking keys. Users can also search for individual assets and transaction metadata if they have the information. Developers can use APIs to scrape data from the blockchain to inform all sorts of processes, programs, and to create data sets.

DEX

Here is a Cardano DEX list for you to explore all the decentralized exchanges built on Cardano. There are multiple Cardano DEX projects for you to choose from, each with a different take on the DEX concept and the way of managing a decentralized exchange protocol.

Listed here are Cardano DEX projects that are based on both the automated market maker (AMM) and the traditional order book style of exchange. Both types of DEX on Cardano, like any other exchange, require a good amount of liquidity to operate effectively. This leads many to say that the best Cardano DEX is the one with the most liquidity. However, there are many other factors that the users of these DEXes would tell you to take into account before deciding which is the best Cardano DEX, and which one you should interact with (although a high amount of liquidity is a good indicator for users).

Interestingly, many Cardano exchanges, such as Sundaeswap, use the concept of “batchers” to collect, order, and execute transactions. This reliance on a small group of batchers to order and execute user transactions reduces the decentralized nature these exchanges as these entities could easily collude to front run transactions from particular wallets or to censor transactions from other wallets.

DeFi

Here are all the Cardano DeFi projects complete with descriptions and tags. If you’re looking for a Cardano DeFi exchange, a lending protocol, a launchpad, a Cardano stablecoin, or platforms on which to tokenize real world assets then you’ve come to the right place. The Cardano DeFi ecosystem is maturing and, as it does, we will continue to list the new Cardano DeFi projects here. If you look at Cardano in 5 years this list will be substantially different, some projects will have left it, but many many more will have been added.

If you’re looking to simply swap Cardano native tokens then a Cardano DEX is your best choice. If you’re looking to utilize your crypto holdings for a loan then take a look at all the Cardano lending and borrowing platforms on offer and choose which one fits your needs. There is much more utility in the Cardano DeFi world and we invite you to explore it here!

DAO

If a project on Cardano operates with a DAO that you’ll find it tagged and listed on this page. All of these Cardano DAO projects have, in some form or another, incorporated or plan to incorporate a DAO. Not all of them will be full autonomous and this may be for one of many reasons, be it that features are being released gradually, that they will never actually be a full and proper DAO (and this a debate for another time).

There are specific Cardano DAO projects listed here, and these are those that operate as a full DAO, who’s direction is guided by the votes of its members. Others on here are projects and protocols built on Cardano, and these can take various forms, including: DeFi projects, NFT projects, and gaming projects.

Regarding full Cardano DAO projects, these have been created around many different topics, the most popular being Cardano investment DAOs that invest in Cardano NFTs and tokens. However, there are other DAOs focused around things such as the development of open-sourced tooling, the growth of the DAO idea itself, and art.

Blockchain Explorer

Here you’ll find all the Cardano explorers developed by both the community and IOG, the builders of the Cardano blockchain. These Cardano block explorers allow you to view Cardano transactions and search and explore blockchain data using a variety of pieces of information, including: a wallet address, transaction ID, asset ID, and policy ID.

Many of these Cardano blockchain explorers are also Cardano testnet explorers, and allow you to, separately, view the transaction activity for both the Cardano testnet and the Cardano mainnet.

Some of these block explorers offer simple, visual displays of the Cardano blockchain, others are true Cardano block explorers, allowing you dive deep into all the elements of Cardano transactions, others allow you to bring up and view the assets associated with a single blockchain address (i.e. your wallet), whilst others are data rich platforms offering insights into the past and current state of the Cardano blockchain—featuring data points, such as blockchain load, Cardano transactions per second, and the Nakamoto coefficient of Cardano.

Audit

Audits are incredibly important in the decentralized and blockchain world and audits are completed on a platforms code, typically by 3rd parties, to ensure that that code is as watertight as possible. Conducting audits before releasing product is a best practice technique and can expose flaws in a protocol before that protocol is released to the public, allowing developers to fix them so that they cannot be exploited by hackers.

When we run on the mantra that “Code is law” then that code needs to be secure so that everyone can be sure that their tokens are safe in the protocols and platforms they’re using. The projects tagged with audit are those that offer or conduct audits on platforms and projects in this space.