What is Sister in Law Finance (SIL)? To answer that, let’ start with the problem. One of the biggest issues that exist in the DeFi space is impermanent losses. Impermanent losses occur quite often when providing liquidity to any Automated Market Maker (AMM) exchanges. Impermanent losses will eat up all your trading income leaving you with only negative returns.
Read more about impermanent losses here.
Watch a video on impermanent losses here.
The Solution: SIL
In order to solve this issue, SIL.Finance (Sister in Law) is a crypto project that is introducing a smart contract-based pairing engine that will provide two additional revenue streams for liquidity providers. This will effectively bring an end to impermanent losses. Through the use of a single-sided exposure LP vault, it will eliminate the need for users to deposit two coins to provide liquidity. The platform will look to optimize pain points and improve the overall efficiency for DeFi users’ financial needs. The project will act as a strategic financial tool allowing individuals to participate in arbitrage in the DeFi market. It will allow users to utilize the speculative benefits of its financial derivatives and allow users to better diversify planning, investment and financial management.
How exactly does SIL.Finance work?
With this single token approach, DeFi miners can deposit funds in exchange for tokens. They can then stake tokens in an eligible pool and also serve as a one-sided liquidity. A smart contract-powered matching system will then ensure each pool’s liquidity balance is maintained through matching LPs with other users who have the opposite asset. The LPs will then earn a profit from LP transaction fees and LP stakes from mining, swaps, and reforming LPs. Apart from eliminating the issue of impermanent loss, SIL.Finance’s automatic LP grouping will also enable users to claim profits from the smart contract whenever they want. The system will also automatically stake the users’ newly claimed profits which will then compound their interest through converting rewards into new LP assets.
What does SIL.Finance hope to achieve?
The co-founder of SIL.Finance, Vincent Gu, has said that they hope to “simplify liquidity mining”. With SIL.Finance, it will automatically select and configure products that best suit the interests of users depending on factors such as annualized rate of return, safety factor, financial management cycle, etc… SIL.Finance will also take on the risks that usually relate to liquidity mining. LPs will match automatically to create a liquidity pool through a P2P dual-mining model. This would mean that the users do not need to gamble on two speculative assets in order to provide assets.
Last but not least, the team behind SIL.Finance is fair and just. All the revenue of mining will be proportionally distributed to all users since there will be no intermediary or principal commission fees. The platform is created by crypto enthusiasts worldwide and the management of the platform will be entrusted to all SIL holders.
What are some features of SIL?
Dual Currency SIL Vault:
- Users only need to stake currency to join the LP pool. Current dual currency APY is higher than single currency mining
- SIL will bring real liquidity to partnered swaps. Not a simple matryoshka doll mechanism
- No need for exchanging for another coin when mining. Each party of the paired LP will bear one coin’s impermanent loss for free, but will obtain higher annualized earnings
Compound Interest Model:
- Users can deposit tokens into SIL and it will pair into LPs. Users can stake LP to mine contract CLAIM earnings
- CLAIM earnings are exchanged for 2 coins forming a new LP and re-stake. The newly added LP will then distribute to the current LP pool users depending on their share.
Token Automatic Matching LP:
- When a user adds the token to SIL, it will then be automatically paired to LP for mining. Simultaneously, the user that holds half of the LP’s equity (LP gains after the burn), can choose to withdraw the token from the LP at any time
- The matching mechanism will be a three-tier model that ensures that the first entrant has a superior queue position
Token Pairing Earnings: Token Paired as LP (Two levels of earnings)...
- As an LP liquidity provider, they will receive transaction fee earnings of automatic market making
- LP will stake for mining, swap the mined tokens (UNI, SUSHI, etc.), re-form LP and distribute to users, enjoying a passive compound interest growth
SIL Distribution (No-Premining)
- When the user adds a token into the SIL contract, the SIL token will distribute according to the share of the added token. Even if the pairing is not successful, there will still be SIL Token earnings. SIL token earnings will split equally in the LP’s Token0/Token1 deposit queue.
- Initial Roadmap
- SIL.Finance will always support UNI token and SUSHI token
- Midstage Roadmap
- SIL.Finance will be experimenting a batch of pools to reduce impermanent losses
- DeFi loan settlement function integration
- DeFi+CeFi arbitrage strategy product, which will be automatically executed by contracts
- Business model such as “CompDelegator”, which aggregates the participants’ assets into a pool and coordinates the overall strategy.
- The automatic asset management tool/safe is the entry product of the DEFI world, and SIL.Finance hopes to automatically use it as PayPal or MatrixPort.
With the increasing number of DeFi users and the Total Value Locked in DeFi mining solutions, the risk of impermanent loss is inevitable. Many poorly audited AMMs make it much easier for users to be under the risk of impermanent losses. So SIL.Finance hopes to take DeFi mining into the mainstream through fundamentally reforming how it is done. This will make liquidity mining accessible to everyone that wants to earn a passive income!
Check out more on SIL.Finance!
Remember Beeple‘s $69 million NFT sale? Now the same auction house, Christie’s, will auction off a collection of nine CryptoPunks NFTs next month. Released in
The DeFi Market continues to grow, with Alameda Research classifying Southeast Asia as a potential growth hub. Alameda Research, the leading quantitative crypto trading firm
Soon after Morgan Stanley announced it will start offering bitcoin to it’s wealthy clients, Goldman Sachs will reportedly soon offer its private wealth management clients