<aside> 🦄 Depositing out-of-range liquidity into lending protocol to earn yield

</aside>

<aside> 🔗 Links

• GitHub: https://github.com/tryouge/idle-liquidity-hook
• Deck: https://docs.google.com/presentation/d/1e-7aLkiQFYKuWm20TIEnOuBBvsctQ6aAkg4tNT7xV2A/edit?usp=sharing </aside>

Demo:

https://www.youtube.com/watch?v=fBcmvwEsRtg&ab_channel=VikramPrabhu

Problem / Background:

We were inspired by the idea because we believe it has a lot of inherent utility and could gain a lot of traction. We are solving capital inefficiencies for inactively managed LP positions which are quite common.

Impact:

The project is a bit unique in the novel approaches it takes to balance liquidity between lending protocol and the pool. The impact is super net positive in the sense - LPs would earn higher fees on their positions without this coming from other parties (swappers etc). This is simply better capital usage resulting in higher yield.

Challenges:

Some of the challenges faced:

1. Ensuring the hook has free access to the liquidity (claim tokens) while still allowing for the user to freely remove their liquidity (user claim tokens)

2. Understanding how liquidity/token amounts are distributed across tick ranges (involves a lot of heavy math - fruitful discussion with Hardik :D)

3. Collaboration (3 people meeting for the first time across 3 different time zones)

Extension:

With more funding/time we would have done the following:

1. Finish the Brevis integration and actually have a few production lending protocols
2. Overall, make the code more production ready with better math/algorithms to dynamically adjust between liquidity between lending protocol and team

Team:

Potatcabbage: regular Web2 Engineer at FAANG, one of the first times working in Web3 space as part of the hackathon

Gulshan: Blockchain developer since 2018, worked on multiple web3 projects

Snowbandit: Web3 dev since 2020