dForce <> Arrakis, protocol collaboration

Hello dForce community,

I’m babarossa, from Arrakis Finance.

Arrakis is a liquidity management protocol that leverages the concentrated liquidity nature of Uniswap v3 using our unique strategies / techniques, to help projects bootstrap liquidity and improve capital efficiency, and also LPs manage their positions with minimized impermanent loss and maximized trading fees. At the moment, we have amassed nearly $1billion TVL which accounts for about 16% of the entire Uniswap v3 TVL across all chains.

Another very important aspect of Arrakis is composability. By using our vaults built on top of Uniswap v3 pools, LP positions are now ERC20 instead of NFTs, meaning that they can again become a money lego to be easily integrated into other applications, just like the good old Uni v2.

All the above made us realize that there are lots of synergies between Arrakis and dForce we can collaborate on to benefit both communities.

For one, dForce can utilize Arrakis’ liquidity management expertise to greatly improve the liquidity depth and capital efficiency for USX. At the moment, USX has rather thin and fragmented liquidity across various chains. This has led to some severe de-pegging over the past months. Arrakis can help bring the liquidity for USX to Uniswap v3 and actively manage it to achieve the maximal capital efficiency. Besides, we also offer the option to add customizable liquidity mining programs on top of the vault dedicated to USX if dForce community would like to provide incentives.

Secondly, the composability we made possible for Uniswap v3 LPs also means that they can be used as collaterals in dForce lending services. This can create significant value for dForce, especially considering the possibility of using leverage on USX (or any other stablecoins) LPs via dForce lending.

We think dForce has been a hugely undervalued protocol that’s been consistently providing high quality service to users. Together with Arrakis, we believe that we can help propel dForce even further in the DeFi space.

Please feel free to reach out for more info and further discussion.

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Hi, sounds like great!
You know, dForce protocol has been deployed on mul-chains, so does it support all chains?

And dForce can use Uniswap v3 LPs as collaterals, right? So how to calculate its value, dForce use the Chainlink as the oracle.

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Great questions ser.

So Arrakis is at the moment on ETH mainnet, Polygon and Optimism, and we are going to other chains as soon as Uniswap v3 is there. FYI, one of our specialties that will be released in the future is cross-chain liquidity management as well, therefore all liquidity for USX by that point can be all managed in one place and the LPs don’t even have to decide on which chain they wanna add liquidity anymore.

Regarding the collateral, we have a pretty simple oracle adapter which we use for AAVE markets and has same interfaces as a chainlink feed. It is basically a wrapper around chainlink feed for fair price of both underlying assets.

Could you explain a little bit about how to calculate a V3 position’s value? For example, I have a NFT position of DF/USX pair, the price range is 0.05~0.1 USX per DF, USX is stablecoin and always aims to peg to 1 dollar.
Thank you.

Hi Jack,

Thanks for your question and sorry for getting back to it this late. Been quite busy lately with all the development of Arrakis.

So in the case of using our vaults built on top of Uni v3, you won’t have to hold an NFT. Instead, we tokenize the position of a vault into ERC20, which makes it easily composable with money markets. We use an oracle adapter that’s been used in AAVE markets, with the same interfaces as a chainlink feed. It is basically a wrapper around chainlink feed for fair price of both underlying assets.

Hi Babarossa, this is MGGYY from dForce. Pls connect me on TG to move this forward.