The concept of decentralized finance (DeFi) exploded in 2020, and its long march to prominence shows little sign of slowing down. Since Ethereum-based projects like MakerDAO set the tone for DeFi, blockchains like Solana have emerged and gained traction with developers and users because of the network’s fast speeds and cheap transactions.
Developers most desire speed, scalability, and security when building new protocols, and these are not just buzzwords of the cryptosphere. These three projects emerged in January as DeFi developers begin to flock to Solana in 2022 with their teams.
What is Hubble: Supercharged Makerdao
Hubble Protocol is a stablecoin and DeFi protocol set to launch on Solana at the end of January. Hubble, dubbed a “supercharged MakerDAO” for the Solana blockchain, allows users to mint USDH’s stablecoin at 0% interest against BTC, ETH, and SOL collateral, and users are able to earn interest on their deposits.
For example, when an individual deposits SOL for a USDH loan, he or she can choose to stake the tokens in the Proof-of-Stake (PoS) liquid staking protocol Marinade. When SOL is deposited as collateral for a USDH loan, users have the option to stake their tokens in Marinade, a Proof-of-Stake (PoS) liquid staking protocol.
Stablecoins have become one of the most important parts of DeFi over the last year. In a similar way to DAI on the Ethereum network, it seems that Hubble will fill a void left in the Solana ecosystem for a fully decentralized stable coin that can be redeemed for cryptocurrency, much like MakerDAO, which is the third largest DeFi project overall by total value locked (TVL).
That could explain why Hubble has managed to raise $10 million from the key players in the Solana ecosystem. Hubble Protocol will launch on the Solana mainnet on January 28th with a triple IDO. HBB tokens can be earned by reporting bugs or improving the UX/UI of the protocol’s devnet application.
The Next Generation of Decentralized Applications (dApps).
The HUBLE Protocol’s MakerDAO-inspired platform is one of the many DeFi protocols on the Solana blockchain aiming to become leaders in the next generation of decentralized applications (dApps).
One such exchange is Zeta Markets, a decentralized futures and options exchange (DEX) that offers cryptocurrency derivatives traders a decentralized platform. Currently under development and with a roadmap that extends into mid-2022, Zeta aims to enable speculating, hedging, and futures options on a wide selection of market movements (potentially limitless).
Zeta will offer users one of the first decentralized derivatives trading platforms that aren’t supervised or controlled by anyone, giving the average trader access to sophisticated trading options previously reserved for centralized exchanges. Zeta also offers users the option of trading under-collateralized positions.
Zeta Markets won the Grand Prize at Season, the Solana hackathon held earlier this year. In addition to the prize money from the hackathon, the team raised more than $8 million on the way to launch. Zeta Markets launched on January 17th, and the protocol is now live.
A Decentralized Derivatives Protocol 01
Among Solana’s upcoming DeFi offerings is 01, a decentralized derivatives protocol that lets tokens from different blockchains be collateralized cross-chain using an on-chain orderbook.
The trades made with 01 can be confirmed in seconds, and executed with sub-milli-cent transaction fees. Traditionally, derivatives traders have been restricted to using only fiat currencies or the token native to whatever centralized exchange was used.
This model will be upended by 01 by allowing cross-chain collateralizations from multiple networks. 01 has been live since September of last year, and it will launch on the Solana mainnet on January 27th.
Solana: A Scalable, Composable Network
DeFi has evolved into a multi-chain environment, and Solana focuses on creating a scalable, composable network. As more projects are built on the Solana network, the success of the protocols launching this year might determine the future of DeFi’s composability.
DeFi on Solana’s future will be shaped by three projects mentioned in this article. I will be interested to see how their contribution to the Solana ecosystem will increase traffic to the network that already offers the fastest transactions and lowest fees in the blockchain technology space.
Author
Chris Munch is a professional cryptocurrency and blockchain writer with a background in software businesses, and has been involved in marketing within the cryptocurrency space. With a passion for innovation, Chris brings a unique and insightful perspective to the world of crypto and blockchain. Chris has a deep understanding of the economic, psychological, marketing and financial forces that drive the crypto market, and has made a number of accurate calls of major shifts in market trends. He is constantly researching and studying the latest trends and technologies, ensuring that he is always up-to-date on the latest developments in the industry. Chris’ writing is characterized by his ability to explain complex concepts in a clear and concise manner, making it accessible to a wide audience of readers.
