Decentralized finance platform Instadapp introduced a lending protocol called Fluid, which integrates features from Aave, Compound, Uniswap, Maker and Curve.
Fluid was developed over a year and a half with the aim of addressing a recurring problem in the DeFi sector: liquidity fragmentation, the team noted. Traditionally, emerging protocols with advanced features have faced challenges in gathering liquidity.
Fluid is currently in the preliminary testing phase. The team expects to complete the audits by the end of November and is planning a bug bounty event in December. The official release of the protocol is expected in January.
What is liquid?
Fluid’s “Liquidity Layer” design is designed to provide users with a consistent transition between major DeFi protocols, consolidating liquidity and lending services features and ensuring stable lending rates.
The protocol incorporates various methodologies from major DeFi platforms on Ethereum. This includes Uniswap v3’s “slot-based liquidity” feature for enhanced loan liquidations, MakerDAO’s vault protocol for asset security, liquidity pool strategies from Compound and Aave to determine risk and design rate curves based on usage, and Curve-inspired “smart collateral” features.
The protocol will allow users to borrow up to 95% of the value of their ETH, the team claimed, with an emphasis on risk mitigation. For enhanced security measures, Fluid’s loans will adjust in real time, limiting unexpected major transactions and reducing potential risks.
According to DefiLlama, Instadapp has captured $1.8 billion in value in its smart contracts, making it the 10th largest DeFi platform across all blockchains.
In 2021, Instadapp raised $10 million in a funding round led by Standard Crypto and contributions from DeFi Alliance, Longhash Ventures and Andre Cronje.