What is Mellow Protocol? Mellow Protocol is a Yield Farming platform that allows users to provide idle assets into vaults with a clear, transparent strategy to earn profits, or users can create their own vault and become a vault manager.
So what strategies does Mellow Protocol have to differentiate itself from other Yield Farming platforms on the market? Let’s all follow Weakhand in this article!
What is Mellow Protocol?
Define
Mellow Protocol is a Yield Farming platform that allows users to deposit their assets into vaults dedicated to different assets.
Each vault will have many different strategies such as depositing money to AAVE, Yearn Finance, Compound, providing liquidity on Uniswap,… to bring profits to the vault. Each vault will be managed by a person or team and actions will be written on smartcontracts for transparency and clarity.
The project has been audited by ChainSecurity, BlockSec and Cod34r3n4.
Components participating in the Mellow Protocol
- Liquidity Provider: Are people who put their idle assets into vaults to earn more profits. Liquidity providers receive LP Tokens representing the assets in the pool and when they want to get their assets back, they just need to burn the LP Tokens and then the vault will send them back the original assets along with interest.
- Strategist: Are the liquidity managers in the vault that distribute assets to different DeFi protocols. The Strategist will create smart contracts to manage liquidity in a transparent vault.
Mellow Protocol’s Yield Generating Strategies
Currently Mellow Protocol has 2 specific investment strategies for vaults: Fearless Gearbox Strategy and Uni V3 Boosted Strategy. Mellow Protocol has 2 investment strategies, which does not mean it only has 2 vaults, but the project will have many different vaults for different types of assets.
Fearless Gearbox Strategy
The mechanism of action of the Fearless Gearbox strategy is as follows:
- Vaults on Mellow Protocol only accept single assets such as USDC or ETH.
- Vaults will then use their collateral to open a credit account on Gearbox V2 and borrow some tokens.
- After successfully borrowing tokens on Gearbox V2, they will be paired into liquidity pairs and provided for liquidity on Curve Finance. After receiving LP Token from Curve Finance, continue to hold this LP Token to earn more profits on Convex.
Opening a credit account on Gearbox V2 helps vaults borrow more assets, thereby earning more profit than mortgaging on platforms like AAVE or Compound.
Uni V3 Boosted Strategy
The operating mechanism of the Uni V3 Boosted Strategy is as follows:
- The Vault will accept asset pairs such as WBTC – ETH or ETH – USDC.
- Then, the vault will extract a portion of the liquidity to provide liquidity on Uniswap V3 with a specific strategy and always change the strategy to match the price of the token pair. The project’s strategy will also provide within a relatively narrow price range to optimize profits, but because the price range is narrow, the strategy needs to be observed regularly.
- A portion of the liquidity in the vault can be deposited into AAVE or Yearn Finance to earn more profits.
Core Team
Mellow Protocol’s development team includes 12 members and continues to recruit more personnel for necessary positions.
Investor
August 25, 2022: Mellow Protocol announced the successful raising of $2.75M in Seed round led by Arrington Capital, ParaFi and Robot Ventures, with the participation of P2P Capital, Darren Lau, Lemniscap, Principle Ventures,… Mellow also received investment from many direct partners such as Yearn Finance, Gearbox,…
Tokenomics
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Exchanges
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Mellow Protocol Information Channel
- Website: https://mellow.finance/#top
- Twitter: @MellowProtocol
- Discord: discord.gg/w6sJDJrV65
- Documents:
Summary
Mellow Protocol is a new Yield Farming platform in the crypto market. The project has begun to combine with credit projects to borrow more, thereby earning more profits for users. However, Mellow Protocol’s strategies are not too new or too different in the crypto market.