Don't sacrifice your DeFi native rights. highlights its main innovation: a decentralized finance (DeFi) platform that lets users use their crypto assets for lending, borrowing, and margin trading while keeping the utility and ownership rights of those tokens. This feature stands in stark contrast to many traditional DeFi platforms, which require users to give up these rights when they deposit collateral.
The problem with traditional DeFi lending is that in most protocols, when you deposit a token to earn interest or borrow, it gets locked into a contract. Consequently, you lose the DeFi-native rights linked to that token.
Staking rewards: You forfeit your right to earn staking rewards or auto-compounding yield from the deposited token.
Governance rights: You miss out on the chance to vote on proposals related to the token's protocol.
Capital efficiency: The token remains inactive while locked reducing its productivity.
How Dolomite preserves DeFi-native rights is through its design, which enables a virtual liquidity system. This system keeps assets productive while being used as collateral. The main features of this approach include:
Virtual balances: Dolomite implments a system of virtual balances that tracks your deposited token while allowing it to earn rewards from outside sources. This means you can still earn yield or staking rewards even with the token collateralized.
Support for complex assets: The platform can manage various assets, including yield-bearing and staked tokens (like LP tokens). Dolomite's setup includes custom adapters to accurately account for reward flows from these assets.
Isolated positions: To control risk, Dolomite uses isolated borrow positions. This prevents a liquidation event in one position from threatening the assets in another, enabling users to pursue advanced strategies confidently.
Multichain strategy: Dolomite functions across several networks, such as Arbitrum, Berachain, and Polygon zkEVM. This improves liquidity and lowers the risk tied to relying on a single blockchain.
Benefits for users include a platform that safeguards these rights, making Dolomite a more efficient and userfriendly DeFi choice.
Maximized earnings: Users can earn returns from lending, borrowing, and margin trading at the same time as rewards from staking or yield bearing tokens.
True ownership: The platform supports the fundamental DeFi principle of non custodial ownership by ensuring users always maintain control of their funds.
Expanded asset utility: Users can utilize over 1,000 different assets as collateral, freeing them from relying on a small number of top tokens and unlocking value from their entire portfolio.
