GoGoPool Podcast Summary: Savvy DeFi

Breevie, host of the GoGoPool Podcast, interviewed Roman and Akshay, the founders of Savvy Defi, a decentralized lending protocol.

Full GGP Podcast with Savvy DeFi

What is Savvy DeFi?: An Overview

When asked to give an overview of their project, founder Roman replied, “We created a no cost advance on your future yield. In effect, we[‘ve] allow[ed] AVAX users to stake their assets safely and then borrow against them with self-repaying lines of credit that cannot be liquidated, so we’re a really unique project for the avalanche ecosystem.” This lending protocol is indeed unique as it empowers investors already integrated into the Avalanche ecosystem to borrow against their future yield. This approach rebuilds debt as a tool of growth rather than oppression. In essence, it allows AVAX holders to open a line of credit on their AVAX token without loss.

What made Roman and Akshay build the project?

The team highlighted the importance of liquidity and explained that, through their project, they aspire to eliminate liquidity costs for DeFi users. For people like Akshay who described himself as a “perma-bull,” (a crypto user that prefers to hold instead of selling assets even in moments of volatility) this project could offer a greater sense of security. This project could offer a greater sense of security. Instead of selling DeFi assets, AVAXers can instead borrow against them, allowing them to obtain liquidity while maintaining their asset portfolio. Borrowing against future yields allows for immediate liquid assets which can be used to further increase yields.

How did Roman and Akshay get into crypto?

Akshay began his crypto journey in 2013 when he purchased his first Bitcoin. “At first I thought, cool! I can trade this without having to use my actual money,” stated Akshay. In 2017, when the industry became more mainstream, Akshay became curious about Ethereum, fascinated by the idea of building projects as opposed to simply using tokens for currency. Last year, he became heavily involved with the DeFi community. Since then, he has continued his passion for building through his foundership of Savvy DeFi.

During the podcast, Roman also outlined his compelling corporate-to-crypto story. After spending many years working in sales, he was introduced to Bitcoin by his friends. Roman admitted that he was not entirely sold at first. “I was like [this is] magic internet money. I’m not interested in that,” Roman told Breevie, “but fast forward to 2013, I realized I needed to learn more about finances and macroeconomics as a whole, and Bitcoin actually opened up that for me.” After prioritizing this research, Giler landed a job with a prominent bank, working with high net worth individuals and gaining more insight into the world of finance. In 2017, Roman received permission from his bank of employment to build a web3 product with a highly specialized team of crypto industry professionals. The group worked phenomenally, winning a grant from the Stellar Foundation. Last year, Roman decided to devote himself full time to Web3 and begin work on the development of Savvy DeFi.

Why Avalanche?

After researching the tokenomics of Avalanche, both members of the Savvy DeFi team agreed it made sense to build on the blockchain. They were impressed by its price appreciation the positive reception from reputable sources in the community, and the security and centralization of Avalanche’s tech ecosystem. “Generally, there were just no warning signs,” said Roman during the podcast, “just a nice, wholesome new chain that was up and coming and doing a lot of cool stuff.” Akshay also emphasized the beauty of subnets and their ability to remove transactional congestion. Avalanche in particular, he noted, allows for more flexibility as investors can stay in the ecosystem but spin off into other subnets.

User Experience

We asked the founders to give a general walkthrough of the user experience. The first step involves connecting the app to the user’s self-custody wallet and approving the contract. The approval serves as a yield strategy (the act of lending assets in exchange for additional yield) with the user’s base asset. The protocol is currently set up to support Stablecoin, AVAX, Bitcoin, and Ethereum. Once chosen, users will be able to deposit into the yield strategy and receive a line of credit called a “Savvy asset,” which matches the deposit. If a user deposits AVAX, Savvy DeFi can create Savvy Avax for the user, which can then be repurposed to mint users’ deposits so they can move forward with their original strategy in DeFi. The founders explained the many possibilities this affords the Avalanche community. Akshay offered an example involving Avalanche yield optimizers Beefy and Yield Yak:

“Let’s say I can get 5% yield on my stables. Essentially it would take me about seven plus years to pay off my credit line debt. What I would do is basically hedge against crypto and diversify and invest into other angel investments. I know that startups have about a seven year horizon, so I would actually take out a credit line and invest into a different startup–as I say–an angel investor, knowing that in seven years, my investment became essentially free.”

“The ideas are endless,” retorted Roman. “We encourage the community to provide more strategies and kind of help grow with us.”

Roadmap

Savvy DeFi confirmed contracts have been completed, they are present on testnet, and the auditing process has begun. While they are not yet prepared to share official launch dates, we learned they are participating in a “fairlaunch.” After much deliberation, they settled on a two-step process as the most effective way to distribute governance tokens. The first step is called the liquidity generation event. During this time, a certain portion of governance is emitted to a liquidity pool. There is no set price on governance tokens at this time. At the end of the period, all participants subtract the funds divided by the total number of tokens. The resulting number is the amount of governance tokens each participant receives. The overall approach is designed to decentralize the governance of the protocol and provide liquidity to all participants. This ensures the price of the token will be based on its demand after it has been presented to the Avalanche community.

Where to find Savvy DeFi

If you are interested in finding out more about Savvy DeFi, you can find them on Twitter @SavvyDefi. You can also check out the full podcast at GoGoPool TV or by listening in the link above.

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Decentralized staking protocol building for Avalanche Subnets.