Multiple Protocol product overview: Decentralized funds based on Uniswap v3
(Translated coverage — https://cointelegraphcn.com/news/multiple-protocol-products)
Multiple Protocol is a decentralized financial platform based on Active Market Making protocol.
Chasing ups and downs seems to have become the norm. Although many people hope to benefit from market volatility, unfortunately, their judgments on the market are often preconceived-they have a good sense of risk control and risk in the market, a sound trading system, and reasonable capital management methods while strictly enforced traders account for only a minority.
This is especially true in the world of DeFi. Although Uniswap v3 hopes to improve capital efficiency by introducing the concept of “centralized liquidity”, it also raises the barriers to participation to a certain extent. Today, many people are still using Uniswap v2. This means that there are still many DeFi users who cannot enjoy the efficient capital efficiency provided by Uniswap v3.
Multiple Protocol is a decentralized financial platform based on active market-making protocols. It aims to provide professional AMM (Uniswap v3) liquidity strategies and operations under the premise of ensuring safety, and enable users (Liquidity Provider) to use it to get the best strategies for LP’s that get the best profit.
The emergence of Multiple Protocol has opened up a new exposure; ordinary users can use Multiple Protocol to capture higher interest rates and capital efficiency. With the expansion of the DeFi world, the attributes of Multiple Protocol as a financial tool will become more and more important and become an indispensable part of the ecology.
Importance of tools
In the barbaric growth of the DeFi world, the lending, trading, options, insurance, liquidity mining and asset management sectors have taken turns and achieved considerable development. But this has also caused the ecology on the chain to become sufficiently complex, and due to the complexity of the chain, the threshold for ordinary people to participate in financial activities on the chain is extremely high.
The emergence of DeFi professional tools has solved this problem to a large extent. For example, our most commonly used tool Metamask wallet can help us easily access the financial protocols on the chain.
It has been 5 months since Uniswap v3 went online. Relying on the concept of centralized liquidity, dozens of agreements have been bred. Most of these agreements belong to the three sectors of liquidity management, trading tools, and liquidity mining. The attributes of financial tools are obvious. And Multiple Protocol is one of them. Multiple Protocol hopes to achieve a win-win situation in the new Uniswap v3 product ecosystem by matching the liquidity of ordinary users and the top investment strategies of professional traders.
In-depth Multiple Protocol products
The Multiple Protocol product mainnet was launched at 16:00 on August 31. At present, the TVL (total lock-in value) of the Multiple Protocol has exceeded 5.35 million U.S. dollars, earning more than 210,000 U.S. dollars in profits for users, and the highest APY exceeds 73%. (As of data before release)
The protocol currently supports the pledge of four tokens, namely USDC, ETH, UNI and DAI. Among them, the total locked value of ETH is the highest, and APY is 76.12%. USDC APY is 53.82%, DAI APY is 69.48%, and UNI APY is 62.06%.
The mainnet participation is subject to application at the moment:
Apply to become an LP on multiple- https://forms.gle/xkjraaQBE7ADvWpcA
Apply to become an GP on multiple- https://forms.gle/bpqvim9wB8MssQEt5
Among them, we can deposit these four tokens to obtain corresponding income. In addition, users who deposit to LP vaults can also see the amount of investment and income through the “My Reward” column. For example, the income after investing 0.5 ETH LP:
The Multiple Protocol also provides detailed and real-time data for ordinary liquidity providers. The data includes three sections, namely “Pair Volatility”, “Vault Pool APY / pledge pool rate of return”, and “Fees received / fee income”.
“Pair Volatility” shows us the volatility of liquidity token pairs:
“Vault Pool APY” shows us the changes of APY in the past:
“Fees received” shows us the fee income of the agreement:
The above are the functions that LP users can use.
If you want to apply to become a professional trader GP who provides strategies for LP, at present we can contact the official application to become a GP. After the application is approved, the GP will be airdropped an NFT work permit (Work Permit NFT).
GP can participate in market making by creating positions: (the function will be opened soon)
For GP, Multiple Protocol has also done professional data analysis on the situation of each position:
And we can also see the current GP ranking: (GP data source Multiple Protocol Playground)
Performance ranking of GP’s and Capital Allocation is based on POP (Proof of Profitability), which is an indicator introduced by Multiple Protocol. POP can distinguish the profitability of different GP teams’ market-making strategies, and determine the use of funds and the setting of stop-profit and stop-loss lines that they enjoy in the agreement.
Profit distribution on Multiple Protocol
For LP users, the profit brought by Multiple Protocol is intuitive, and we can easily see it in our panel. Multiple Protocol further simplifies the complexity of investing in the DeFi world for everyone. LP users can improve capital efficiency and reduce capital risks without actively making markets with the help of GPs.
Therefore, GP’s play an important role with Profit distribution with professional strategies on the Multiple Protocol.
After the LP deposits liquidity, the Multiple Protocol smart contract will allocate their funds to different levels of GP, and the GP will help the LP obtain the maximum capital efficiency through the specific market-making strategy set by them. The security of LP’s funds will be guaranteed by smart contracts.
The equity that GP obtains in Multiple Protocol is determined by the value of PoP. The higher the PoP value, the better the market-making strategy of the GP. This means that the GP can operate more LP funds, and they will get more and more profits from it-which means that they are less likely to do evil. The benefits of their work far outweigh the benefits of doing evil. As the number of GPs increases, the financial losses caused by a single GP’s evil actions cannot affect the overall financial situation of the platform.
It is worth mentioning that Multiple Protocol will issue an NFT work permit for each GP, which will record every profit made by the GP. Once used, it cannot be transferred. This is also an application of Multiple Protocol at the level of NFT identity experience. It is foreseeable that in the future, the NFT will become a well-recognized proof of ability in the DeFi world-the NFT work card represents the market-making ability of a professional trader.
The Multiple Protocol native token $MUL will play a key role in the distribution of benefits.
In the early stage of the project, MUL will be used to set up a fund to incentivize GPs who participate in the early stage. MUL can be used to compensate GP’s gas expenses when making the market. Second, 50% of the MUL will be regularly used to reward outstanding GPs. GPs with high performance and long-term high-quality strategies will be rewarded by $MUL airdrops.
In the middle and late stages of the project, the core value of $MUL lies in sharing profits with ecological participants. 5% of the platform profit will be used to distribute to all token holders who pledge $MUL on the platform, and the other 5% will be used to repurchase and burn $MUL. Users who pledge $MUL on the platform will also enjoy the governance rights of Multiple Protocol.
In addition, as the agreement develops and matures, Multiple Protocol will issue additional GP work permits on a regular basis, and $MUL will be used to participate in the work permit auction. All GP work permit auction proceeds of the agreement will be locked in the Multiple Protocol platform as reserve funds.
Let’s take a real-world analogy. Multiple Protocol is similar to traditional funds-by introducing professional market maker strategies to bring users high returns under low risk. It is a bridge between ordinary investors and professional traders, bringing liquidity funds to professional traders, bringing higher returns to ordinary investors, and achieving a win-win situation. At present, the Multiple Protocol mainnet has been online for nearly a month. The product is stable and has passed code audits by security agencies such as Certik. The TVL (total lock-up value) is still rising steadily and is expected to exceed the 10 million US dollar mark in a short period of time.
For all investors who want to achieve high capital efficiency through Uniswap v3 centralized liquidity, Multiple Protocol is a rare high-quality DeFi tool. I believe that not far in the future, more LPs will enter the Uniswap v3 ecosystem through Multiple Protocol to jointly promote the expansion of the DeFi boundary.