Rift Protocol

From their blog (10-3-2022):

"By rethinking the incentives behind liquidity provisioning, Rift unlocks a new frontier of DAO growth. DAOs can now deploy the governance tokens to significantly deepen their liquidity on DEXs without having to give up ownership of their tokens and mercenary farmers have the opportunity to earn double rewards and reduce their risk of impermanent loss."

Basics

• Based in:
• Started in / Announced on:
• Testnet release:
• Mainnet release:
• Rift is a decentralized protocol that restructures incentives to improve liquidity across DeFi.

Audits & Exploits

• Bug bounty program can be found [insert here].

Token

Launch

• "Rift Finance does not currently have a token." (19-3-2022).

Technology

• Whitepaper or docs can be found [insert here].
• Code can be viewed here.

Implementations

• Built on:
• Programming language used:

Transaction Details

• Capacity (TPS):
• Latency:

How it works

• From their blog (10-3-2022):

"DAOs deposit their tokens into a Rift Vault. These tokens are paired with ETH deposited by liquidity providers and deposited in a DEX to deepen liquidity for the pair. Token pairs remain activated on DEXs until either liquidity providers or DAOs withdraw their tokens and positions are rebalanced. LPs can deposit ETH into any vault containing DAO tokens on Rift. This ETH is paired with governance tokens deposited by the DAOs then activated as liquidity in DEXs. All swap fees from the DEX LP position, in excess of impermanent loss, are shared between the ETH depositors. This allows them to earn 2x rewards while only providing 50% of the capital for the position. The Rift Vaults are perpetual. They operate on an epoch-based system to prevent known DEX attacks like front-running. Upon withdrawal, returns are distributed to both sides according to the rules below. Any deposits that are not withdrawn remain in the DEX as activated liquidity for the pair. Rift Vaults implement an interest rate floor for the ETH side of the Vault, mitigating the risk of impermanent loss for liquidity providers. Additionally, it implements an interest rate ceiling for the DAO side – so that any yield in excess of the ceiling is used to attract LPs. Therefore, if yield exceeds impermanent loss, LPs take on the impermanent loss but still profit. If the impermanent loss exceeds yield, DAOs take on the impermanent loss.

What happens if the DAO token price increases relative to ETH? The ratio of assets in the pool will have been skewed such that there are now fewer DAO tokens and more ETH in the LP position. In this scenario, the excess ETH in the position is swapped for governance tokens to pay back the DAO and make their position whole, never going below the LPs initial deposit.

What happens if the DAO token price decreases relative to ETH? The ratio of assets in the pool will have been skewed such that there are now more DAO tokens and fewer ETH in the LP position. In this scenario, the excess governance tokens are swapped for ETH to make the liquidity providers whole.

If swap fees outweigh IL, excess ETH is retained as profits for Rift LPs."

Upgrades

• V2 has already been released (10-3-2022).

Roadmap

• Can be found [Insert link here].

Usage

Projects that use or built on it

• From their blog (10-3-2022):

"We recently shared how Terra, Fantom, and UniLend took control of their token liquidity by utilizing V1 of the Rift Protocol. This beta allowed our partners to control up to 32% of their liquidity on Ethereum DEXs while still retaining ownership of their governance tokens."

And also according to their website (21-3-2022):

Parsiq, Injective, Marlin, Ramp, Flux, NearPad and Trisolaris

Team, Funding and Partners

Team

• Full team can be found [here].

Funding

• According to their website (21-3-2022):

Pantera, Two Sigma Ventures, Coinbase Ventures, #HASHED, DeFiance Capital, Spartan, Jump and Vessel plus Do Kwon, Sandeep Naiwal, Stani Kulechov and Tascha P.

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