Understanding Dolomite
Dolomite is a decentralized finance (DeFi) platform where people can lend, borrow, and trade digital tokens.
It’s not just a simple lending pool — it combines a money market with an exchange and a margin system.
What makes it stand out is scale. Dolomite is designed to support over one thousand tokens — far more than most lending apps, which usually focus on only a few big names like ETH or USDC.
The project is live on chains such as Arbitrum, and its value locked (TVL) has climbed into the hundreds of millions, showing steady adoption.
Why Dolomite Matters
More tokens to use: Unlike most platforms, Dolomite allows niche assets, LP tokens, and staking wrappers.
Keep your benefits: Tokens that earn rewards or carry governance rights can still do so even when they are collateral.
Efficient use of funds: With its margin and exchange features, you can trade or hedge without moving assets to another app.
Partnerships: The system works with projects like GMX, making GLP and GM tokens usable in new ways.
In short: Dolomite expands what your tokens can do.
How Dolomite Operates
Supplying assets — You deposit tokens and start earning yield.
Borrowing funds — You can take a loan against your deposits.
Special adapters — If your token generates rewards (like GLP), Dolomite connects an adapter so those rewards continue while you borrow.
Trading and margin — The built-in margin engine lets you go long or short with leverage.
Price feeds — Chainlink oracles provide prices, and if your position falls below safe levels, liquidation occurs.
Governance token — The native token, DOLO, powers voting and can be locked for deeper participation.
Practical Use Cases
Earn with stablecoins: Deposit USDC to earn interest and withdraw when you want.
Borrow against staked tokens: Add GLP, keep receiving its ETH rewards, and still borrow USDC at the same time.
Leverage trading: Use ETH as collateral to borrow and trade another token with margin.
Liquidity tokens as collateral: Stake GM tokens, borrow against them, and continue collecting their built-in rewards.
Benefits
Massive list of supported assets.
Collateral keeps earning rewards.
Margin trading built into the system.
Works closely with established DeFi projects.
On-chain stats are open and easy to track.
Drawbacks
Advanced features can overwhelm beginners.
Some smaller tokens have thin liquidity and volatile prices.
Competes in a crowded market with Aave and Compound.
The “1,000 assets” claim is more about design capacity than current listings.
Important Risks
Code vulnerabilities: Audits lower the chance of bugs but don’t remove it.
Oracle failures: Wrong price data can cause unfair liquidations.
Liquidation danger: If collateral drops in value, your loan may be closed.
Token-specific risks: Assets like GLP and GM carry their own unique risks.
Changing rules: DeFi is still under evolving regulations.
Getting Started with Dolomite
Download a Web3 wallet such as MetaMask.
Move funds to a supported chain like Arbitrum.
Visit dolomite.io, open the app, and connect your wallet.
Begin with a small deposit.
If you borrow, monitor your safety ratio carefully.
Learn the rules for any special token before using it as collateral.
Watch Dolomite’s growth on DeFi trackers like DeFiLlama.
Closing Thoughts
Dolomite’s promise is simple: turn every token into working capital. Instead of sitting idle, assets can earn yield, back loans, and support trades — all while keeping rewards and rights active.
The platform may take time to learn, but it gives tools that few DeFi projects match. For users who want more flexibility with their tokens, Dolomite is worth paying attention to.
