AMA with Tascha from Alpha Finance

Transcript

discord we'll prioritize those questions you can also ask your question on youtube dave and i will be checking in on youtube getting your questions queued up this is really an opportunity for you guys to ask questions of tasha and uh of the alpha finance project we do this on the youtube and then we also uh put it out on the podcast too so if you prefer listening to it in podcast format you can get it that way too david we should just introduce folks to you to alpha finance and alpha hamara specifically um what do you want to say as an intro to this exciting cool project yeah it's really exploded into the forefront recently which is and it's it's always

pretty cool when a project does that when it just rises out of the the very chaotic world of defy into the forefront of people's minds um the alpha is famous for being able to provide really really really strong yields on ether above and beyond what you would get from eath staking and the way that alpha does that is what we call what they've called leveraged yield farming so i have my questions as to what that entails how risk is controlled what the participants are in the system uh apparently alpha is originating more loans than ave which is pretty insane because obviously it's so crazy it's like the canonical uh lending platform uh so we're gonna get into all these questions uh in just a little bit

but uh before we do we're gonna talk a little bit about these sponsors that make this show possible all right gemini is the world's most trusted cryptocurrency exchange i've been a customer of gemiini since i first got into crypto in 2017 and it's been my main exchange of choice to make my crypto buys and sells gemini is available in all 50 states and in over 50 countries worldwide and on gemini there are markets for over 30 various different crypto assets including many of the hot defy tokens and it's one of the few exchanges that has liquid die markets gemini just launched their earn program where you can earn up to 7.4 interest on 26 various crypto assets if you're tired of paying fees in defy or you don't want to worry about defy

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ethereum and just recently released ave version 2 which has a ton of cool new features that makes using ave even more powerful with ave you can leverage the full power of d5 money legos yield and composability all in one application on ave there are a ton of assets that you can deposit in order to gain yield and all of those same assets can also be borrowed from the protocol if you have deposited collateral here you can see me getting a 200 usdc loan against my portfolio of a number of different defy tokens and eth i'll choose a variable interest rate because it's a lower rate than the stable interest rate option but i could choose the stable interest rate option if i wanted to lock that interest

rate in permanently one of ave's v2 features is the ability to swap collateral without having to withdraw your assets trade them on unit swap and then deposit them back into ave ave does all of this for you all in one seamless transaction so you don't have to repay loans in order to change the collateral you have backing them check out the power of ave at ave dot com that's aave.com all right guys we are back with tasha from alpha finance for this community ask me anything tasha how are you doing today good thanks for having me tasha i want to get into your background actually first and and talk a little bit about where where kind of you came from

so you've got investment banker in your twitter bio so uh maybe you might be the first banker guest we've had on bankless which is kind of fun so tell us how you fell down the d5 rabbit hole and uh found yourself building a defined protocol yeah so you know since when i was studying at uc berkeley um i've always been interested in in crypto and blockchain space and you know berkeley and the bay area are very you know tech savvy and and friendly space right so that's how i first got exposed and then just keep studying learning more about the whole space um and generally i i like finance and i like tech right so you know when i first

started my career i decided to join a tech investment banking role so that means that i'm doing financial services for tech clients um across the u.s and across the the europe as well and then when dfi started to become more you know dominant and also becoming the main use case of blockchain that's when i really got you know very very excited and and trying to learn more about it and pretty much yeah um after finance role i pivoted to more tech to product management at tencent and then pivoted to more blockchain and band protocol and then now um d5 right so it's been a journey but you know it's been quite some time that i've

been interested in studying um the whole space that is super cool so did you come into crypto by way of more defy or did you come more by way of like like the bitcoin sort of path it's uh the bitcoin pens okay gotcha so you started with bitcoin and then and then went into kind of the defy side of things okay well so uh tell us about alpha alpha really alpha finance and why you decided to to focus on the the areas that you're focusing with this d5 protocol yeah so you have to to think alpha finance as a d5 lab and what that means is that we're incubating and innovating a number of d5 products um the goal of each of the products to be different so

the problems we're solving would be particular to a particular area for each product right but then at the end of the day all of these products will work as an ecosystem and the whole ecosystem we're focusing on the main goal instead instead of focusing on one particular area of the file that we want to innovate in so the main goal that all of these products as an ecosystem will work towards is to maximize the returns for users and also minimize the downside risks so um you know once we achieve this goal then of course we would go for the bigger goal and ultimately at the end of the day we are here to hopefully change and pretty much reform traditional finance um but you know given the fight

landscape now given the regulatory landscape it would be some time so so what we're doing now is pretty much trying to make a very useful um and staying at the forefront of d5 and pretty much um grow alpha and d5 to the point where we can make you know more um and bigger impact uh later down the line so this is a theme that we've seen arise out of a number of projects that came out of defy summer and just re the most recent cohort of d5 projects uh notably yam started off as this rebasing thing but then it grew its treasury and now it produced the umbrella protocol and so it's kind of acting like a dow where that just produces products uh we're also seeing the same thing out of a sushi swap which first started with a

clone of uni swap and now has bento box which is something totally different a borrowing lending platform uh would you say alpha is is similar to that or is the the uh product side of alpha and like the dow side of alpha different well how would you compare and contrast these different organizations that are living on chain i think there there are multiple differences right like the first one is um it i think it it like how we progress and how the other progress may be different um the end goal may be the same in which that there are multiple products as an ecosystem but for alpha we created as as the first day knowing that it's going to be an ecosystem so that means that we structure the team the way that we work the way we build

are are a bit different we're always going to be on the lookout of new opportunities trying to see which market is looking for which product perhaps let's say if we come up with a new product tomorrow that we think that you know it really fits with the market landscape right now we might just ship it um before the products that we have announced so so i think it's more of a dynamic uh workflow in that sense um so so that's the the main difference uh in terms of how we work and how we build how we evaluate the products right um the second difference is i think uh it's the goal that we're focusing on or like the area that we're focusing on so let's say if um instead of focusing on all the products that we work on we're

actually focusing on the end goal that i mentioned um so let's say if one particular product allows us to achieve that goal better then you know then that means that we have to focus on that product more right um so i think that that whole thing comes back to to the the fact that we are building an ecosystem since day one so with that under uh as like the kind of the social contract of alpha an ecosystem from day one that means that you need a team that can manage an ecosystem right that's more a more specific skill set so uh and and straight up more of a larger team so how did you how did the alpha team assemble where did all of these people come from and who are they yeah that's that's a question that you

know i got asked a lot um because you know it's been quite a a journey for us from you know end of last year to today right um so right now the team mostly is based in thailand um the talent is is pretty uh top-notch in my opinion i mean others can think differently right um and pretty much the way that we recruit are recruiting from olympics um you know candidates and these are a lot of these are already in thailand so thai people are actually pretty um strong in computer science and quant to begin with and then you know now that we have a core strong team we're going to decentralize the whole team and expand whole team uh going forward so now we're

actually recruiting globally um for various roles for tech for business development for marketing so expanding um not just limiting to thailand so when you were assembling this team of of diverse set of skills um you had this product in mind and so how what are the core competencies of the team like what is the what is the if the team was really good at something uh and how does that relate to that what is that thing and how does that thing relate to the product that you guys are trying to build out at alpha i think there are two main i mean three main things one thing is that the team has to be really strong in math uh and and coding i mean coding is is you know a given right like smart contract solidity and

everything but math is something that we really put emphasis on because in order for us to build a cutting edge and innovative products and still be a safe protocol for people to use math is going to be a really core component let's say if you go on alpha hemorrha v1 or v2 now each of the leverage level is you know thought through nippon who's the co-founder and cto is actually ranked the third in the global mathematics olympiad um so he pretty much has done a number of research on what parameter you should go for purple for you know east sushi pool um so it's not not a random number that we are

putting out to users to use um i think that's the number one core skill that that we look for it is crazy to me i just want to make a comment it's crazy to me that defy is starting to attract this caliber of talent now this certainly was not true in the 2017 you know cycle but now it seems like it is true we're getting top talent into d5 working on this project it's super exciting yeah i think it's it's shown a lot of um you know valuable like reasons why people want to come in right the fact that you are creating a new financial system the fact that you're you know it's in the beginning of the whole new era um you're not late it's the game you're actually creating the

whole um future so i think that's that's how people get you know very excited um and and able to attract these talents in which is helpful for the holy d5 uh ecosystem i believe not just for alpha so i want to ask about what what does math unlock so like you know we you see i said that you know coding is a given right so all of these teams can code right and so all the coding isn't really the competitive advantage it sounds like what you're saying is math is the competitive advantage that the alpha team has what does that enable what kind of products does that enable you guys to access because you guys are good at math um so to speak on alpha homo first right um the way that it can offer high

leverage um and pretty much still uh be on the safe side uh is that everything is processed and and all the loans and all the funds are held on the smart contract um the way that we do it and the way that we make sure that the parameters are still safe allowing for buffer even at liquidation there's still another buffer um to allow for more price swing you know what's that buffer is going to be like how are we going to be comfortable building a leveraged new farming product while still having you know a comfort to ourselves right so i think that's for our fakumora for alpha x it's the fact that we are capable of making in the funding rate payments into the quoted price so when building alpha x which is a

decentralized non-order book um per pressure swap trading product we have in mind since day one that we are targeting anyone in d5 who wants to trade for pressure swap without having to know that they're trading for pressure as well let's say that you want 10x returns if each price goes up and each price goes up by a hundred dollars and now you're getting 1000 right so that's the end goal that you're getting you don't have to understand anything in between you didn't have to understand funding rate or rebalancing or anything that is complicated you know in in professional stop trading right so that's the end goal now it determines on it how do we get there so math is going to be really important how do we

figure out a funding rate mechanism that just simplifies everything and makes it just into the quoted price so when people trade on alpha export stands it will be similar to a trading on spot market in which the only prices that matter are the entry price and the x price so you can just take the two prices and calculate your mid gains and losses without having to um you know taking into the account of finding payments in between as well so that's an example of you know math in alphabets so so tasha let's um let's maybe zoom out for a minute and talk high level about these products right so you mentioned two you mentioned alpha amora and alpha x um and i'm not sure if alpha x is out yet but uh maybe we'll get into

that i i know alpha hamora a bit better and so that that is basically a way to get get like some sort of leverage yield farming uh sort of opportunities could you maybe describe that and before you do i'm going to ask a non-matthew question so alpha hamora what's with the harry potter stuff is are you guys big harry potter fans yeah nippon is a really big harry potter fan um and you know with v2 we're generalizing the theme um a lot more so if you go to alpha homora v2 site you can see that the only harry potter reference is the o with the um the lightning okay okay so it's like bulkiness is more

generalized very cool all right cool um so tell us about the product then what does it do yeah so as a user you can use as a two-way for for you know to maximize your your yields on alpha homora if you are a lender then you can lend your assets and get high yields on alpha homora v1 the lending assets is limited to just e and that's because all the loans that leverage new farmers are taking are based on eve so that's why you know the lending asset is limited to just it and that's why it can generate really high lending apy for ethoders because once you lend these eve it's the leverage you

farmers who are borrowing these e to your farm and get the high apy and hence they are willing to pay the borrowing interest rate because they're gaining a lot higher apy on leverage farming on v2 the difference is that with the lenders you are not limited to just e we're expanding you know the the list of assets uh in lending pool to be a lot larger so right now if you go on v2 you can see that e usdp uscc and die are assets that you can then um and then going forward there will be more assets that you can lend as well like wi-fi snx dpi and the list goes on right so alpha homework v2 will continue to grow from the lending aspects and also

continue to grow from the leveraged new farming pools as we continue to add more pools um aspects to so that's from the the lender's side in a bit more detail on the leveraged eu farmers side so once you come in there are pretty much two main like several three main things that alfa homura simplifies for this the leverage you farmers number one is of course you get to unlock that leverage so that means that you don't have to manually borrow loans from one place and then which is also over collateralized loans um and then put uh compiled at loans with your liquidity to begin with and then you farm right so we simplify that uh by having you to

take on leverage that is under collateralized loans as well so let's say if you take one ease to supply you can borrow like 1.5 east so it's even more than what you supply so that's the the one thing that our farmer does for leveraging farmers the second thing is that when you take your liquidity to supply in the first step you don't have to have equal value of both so let's say you want to provide liquidity or you farm on each sushi you don't need to have eth and sushi you have any proportion we're going to take care of that for you either through stop swapping optimally um or other ways right and then third thing is that we complete the whole you

farming process for you so once you supply liquidity once you determine what assets you want to borrow in what proportion what once you determine the leverage level everything is y'all taking care for you which means that you know taking the lp token to stake collecting the farm token all of those things are pretty much all done by alpha hamora so where i would like to know where the yield actually comes from and so in my mind uh i'm getting an image of like the the urine vaults right where there are different strategies that return different amounts of yield based on what those strategies are uh and you know the if you want to go peek under the hood you can go find out what those strategies are how does where does the yield actually come from with with alpha

like where is that are there vaults are there strategies like what is the the gener the yield generation mechanism so there is one main strategy which is that it's taking the liquidity you supply and the borrowed funds that you determine to enter at so let's say 2x leverage then it's you know half of your position is going to be the debt that you borrow so take all of that and supply to the liquidity providing food that you select let's say you select um eat sushi for instance then it will supply to eat sushi on sushi swap and then it will take the lp token to stake um in the liquidity mining pool uh for you to claim sushi so that's you know the main strategy for for all the pools on alfa

homora the difference would be you know which pool you want to provide liquidity or you farm so let's say the apy on eve sushi will be different from the apy from curve 3 pool which is providing usdp dye usdc on curve farming crv token so so that's you know the high level and then the apy for each of these pool will pretty much be coming from three parts uh with also minus the borrow apy so three minus one right so the first part is the you farming apy which is on leverage so let's say if you were to provide liquidity or you farm on each sushi let's say you would get 15

and if you take 2x uh position on alpha homora then that means that you're getting 30 um because you're providing 2x more liquidity hence you can you farm with 2x more of the liquidity and get more sushi right the second thing is trading fees apy which is also on leverage so let's say if you were to get 10 trading fees api on a pool and you do 2x then it would be 20 the third thing is alpha apy which is the current liquidity mining program that we're running uh making sure that we help migrate b1 to v2 smoothly and then you know those are all the positive api the negative apy is the borrowing interest rates that you have to pay uh based on what assets you borrow and how much you borrow

so the yield comes from uh issuing other protocols issuance of their like equity token right so the so then the the sushi eath pear that comes from sushi being uh distributed from the sushi protocol and then when you talk about curve you're you're talking about yield farming the crv token so my metal my mental model has now gone from just urine and vaults but urine and vaults plus dydx which has margin and leverage right so if you slap these things together do you are we generally pretty close to what alpha is yeah cool or for a home ride is yeah cool and then what are the what are the risks so can we talk about a risk and who's taking risks yeah yeah the the risk for someone who's

doing this kind of you know leverage yield farming so you know smart contract risk is always going to be there we try to mitigate as much as possible doing various audits having other builders in the space reading through the codes so that's by everyone who's using the product bearing that risk right for the leverage you farmers your risks are on um pretty much making sure that you your position will not get liquidated because if your debt is too high comparing to the collateral that you put in then you will reach a liquidation point so you can monitor um with your debt ratio number so if your debt ratio is at

100 then that is the liquidation risk that you're you're um you're in which means that other liquidators can come in and liquidate your position uh what that means is that liquidators will get five percent of your position value and then 95 depending on how much debt you have right will be used to pay back the debt that you owe and then whatever is left is sent back to you as a user um so that's the risk that users have to be aware especially when prices swing and can make the position be closer to liquidation risk one one thing to note is that for the curve 3 pool because all the components are stable

coins so if you if you supply stable coin and you're also borrowing stable coins um then the risk is actually lower than the other pools let's say eat sushi that you are providing eat or sushi and borrowing ease so you can see here that the stable coin pools assuming that the stable coins are you know to their peg um then the the position is less likely going to be moved towards liquidation because the dead portion doesn't really move that much because of the the peg system of the stablecoin so that's for the you farmers right on the lenders the risk is that you know if if the

positions or you know leverage positions become underwater um then partially you know the the funds in the lending pool may be um used to cover that uh that that loss right but nothing to to be too worried we actually have several mechanisms to prevent that uh the first mechanism is that even when it's at 100 liquidation uh or even when it's at 100 dead ratio which is the liquidation risk we offer another buffer scenario which means that at liquidation risk the positions are actually not underwater yet so that's the the one thing that we do the second thing that we do is that alpha homora b2 also takes 20 percent of

the borrowings borrowers uh interest rate to set aside as the insurance funds so you know if we have to cover the losses on the underwater positions to cover the debt right then um this insurance funds will be tapped first um before tapping into um the the funds in the lending pool and a pile of insurance funds sounds like a fascinating topic that i i think there's probably a rabbit hole there but first before we go there i want to ask about the collateralization ratio did you just imply that there you could actually have an even amount of debt to collateral in the alpha system uh yes

so so the way that alpha homo works it's not similar to the other uh let's say lending profile um and the key difference is that each asset actually has a collateral credit and a borrowing credit so this is different for for the other lending protocol or like the the mechanism that has been used widely in lending protocol because in typically there is no borrowing credit there is only a collateral credit or the collateral loan to value right let's say if you take uh one e you can borrow approximately 70 value of that one ease um and then you can borrow anything within that 70 value of that eve right

what's different with alpha horror v2 and hence it's kind of harder to calculate what's the exact collateral ratio on top of you know anyone's head you need like the excel to do it um because that when you supply let's say e you would get a collateral credit value let's say you get for instance uh one collateral credit value right and then if you're going to borrow die that will consume for instance 0.5 collateral credit so which means that you can actually borrow two die in this case so assuming that the price is one to one for simplicity right but if you collateral with one ease and you get one collateral credit and if

you're actually going to borrow sushi for instance um sushi would actually uh claim and pretty much require 1.5 credit to borrow which means that if you supply one ease and you have one credit you actually cannot borrow sushi because it requires 1.5 so that's the mechanism that we do which means that the collateral ratio depends and pretty much also the leverage ratios depend on two things what assets you bring in as collateral and which assets you're borrowing and not just which asset you're bringing as collateral and how are these parameters determined well new plan

so any nippon is you know pretty much owning the the main mechanism of you know what parameters we offer um to ensure that it's safe and also still able to offer leverage um and we have this huge excel that we also do uh to make sure that we update you know every every week um depending on the price and making sure that the parameters that we set is still within the the range that we are okay with okay would you would you characterize that as a hands-on endeavor is that something that is updated frequently or like what is the the long-term plan for maintaining this this balance it seems like a delicate balance that if someone isn't having like their eyeballs on it all the time could get out of hand

so technically you don't have to look it you know every week we just do so now because we just launched v2 so we want to make sure that everything is fine you know as the migration process has been going right and all the parameters on alpha v1 and v2 actually have taken into account the worst case scenario um so let's say uh if there's a really huge price swing um or or anything in the past that you know can yeah can can cannot lead to a good event that is something that we also have taken into account um and the leverage that we offer um pretty much ensure that you know if that scenario were to happen again it would be mitigated also we

cannot say that it would not happen because we don't know you know what else is going to happen um in d5 right so can we talk a little bit about um lending on alpha hemorrha so you could land your eth at least in version one now in version two you can lend all sorts of other assets what are what are the typical interest rates because it was it was fairly attractive in alpha v one for eth it was something like like i don't know four to eight percent somewhere in that range uh is that about right so typically it stays around eight percent in v1 and then goes up to like in the tens in the 20s sometimes wow when when the the utilization rate goes really high

and and you know i think the key thing with that is the interest rate model that we use is a three slope curve and i think that works really really well um for for high utilization assets so let's say can we define what that is yeah so typically there is only one kink right let's say like it's here and then it's here um given whatever utilization rate you want to to set the interest rate to be higher uh what we do differently in v1 and also going to adjust in v2 as well right now the v2 is not three curve uh three slope curve yet so in v1 is that it's gonna be like this it's gonna stable at around 80 to 90 percent utilization rate so which means

that at 80 to 90 percent utilization rate the borrowers are paying fixed fee i mean fixed borrowing api and it was flat at 10 percent apy 10 borrowing apy which correlates to about eight percent lending interest rates um and the fact that i tell you that you know typically it stays on at eight percent is because we want the borrowers to be at around 80 to 90 um because we think this is the optimal for both borrowers and lenders lenders get high apy without risking the funds locking without having without being able to withdraw and then the borrowers get you know a fixed apy within this range right and then after uh 90 then it would go up

really steeply so this gap is only 10 from 90 to 200 uh so that's why when uh the utilization rate goes beyond ninety percent borrowers typically just close their position because the apy to to borrow the funds are too high now so yeah with this three slope curve um it allows us to generate pretty high api okay so the three slopes are they're a first long slow slope where the the the interest uh increases a little bit but not that much from zero to eighty percent and then from eighty to ninety percent it stays flat at a relatively low but still well not not too low i guess but it

stays flat from 80 to 90 utilization of the ether deposited and then once you hit that 90 percent it goes up really really fast because you can't get to 100 because that's bad and so that that plateau that you create offers stability in uh yield for the suppliers and the borrowers uh and and that just makes things more stable which i think that that's pretty clever and so you're both incentivizing uh you're you're incentivizing just capital efficiency i think that's pretty elegant yeah so so you know that's the the math behind um uh the high want on lenders as well um and

your your your second question ryan you're asking you know what's the api on on v2 right there are many assets so right now we're migrating more of if uh and in the pools and also the lenders from v2 so um the apy on eve on v2 right now is about five to six percent and then on stable coins it's about thirty percent um including the alpha apy-two yeah wow okay all right so so uh david he's a bit of a defy d-gen you know not like me so i know he's gonna he's gonna use the borrowing side of alpha hemorrha a whole bunch um but i'm a simple holder and i like yields you know in my stable coins i like yield on my eth so i might be more interested in lending but what i what

i'm having uh what i want to understand if i'm to to lend to something like alpha hemorrha let's say i put my ether in alpha hemorrha is kind of the the risk level right and so um you know something like eth v2 right now uh in in staking uh i can earn about 10 maybe 11 smart amount of course my eth is locked up but it's a different story but at least the risk i have there is kind of hypothetically should be protocol type risk right um or risk that eth2 never never ships what sort of risk am i subjected to when i deposit into um into alpha hemorrha as a as a lender and i know you mentioned some of this i just want to wrap my head around it because i know there's smart contract

risk people are familiar with that with all d5 protocols um what other risks you also mentioned some basically some risk on the on the kind of the borrower side if uh if they go underwater somehow but can you walk me through that one more time to make sure i understand what kind of risk there might be sure so when positions are underwater which means that debt is more than collateral that they input it um then when that case happens then the protocol will need to find the funds from somewhere to cover that debt right the first place that the protocol would find that fun is the insurance pool that we have which is coming from the 20

of the borrowing interest rates that the borrowers are paying and then once the protocol taps into that pool and if there is the need to find more funds then it would tap into the pool of uh the lending assets um that will cover the funds um so i think it's more of you can treat it as the secondary uh place that the protocol will look at um and only at the event in which liquidation in which the positions are underwater so in order to have a position to be underwater that means uh that ratio would have to reach 100 and then when it hits 100 no one is liquidating that position yet

for a long time because we give quite a huge buffer even at liquidation which means that when positions are at liquidation the positions are not underwater yet um it has some room to to allow price to swing uh within that room you know depending on how fast price swing but within that room liquidators should already come to liquidate given the the the incentives that they get right but somehow if they don't come in and price keeps swinging um and position uh becomes under under un underwater um because that keeps rising and collateral remains the same you know then the mechanism would be to tap into the insurance pool and then later on the

landing pool got it okay so there's some backstops there and i'm wondering like what would happen in the case of something like a black thursday that we saw a man it seems like a very distant memory but it was it was less than a year ago when we had sort of a a major almost a black swan event of a pretty large eat drop in in one day and make her you know keeper bots liquidator bots had trouble keeping up um and liquidating sort of at the collateral positions could alpha be subjected to something like that um so that too as a risk and then also are there oracle risks involved here too yeah actually before i jump into into that uh one thing that i forgot to

mention is that um on the landing lending side this is actually similar to the other lending protocols as well uh in which that your funds are pretty much going to be subjected to the risk will be if the borrowers don't pay the debt right because technically your funds are with the borrowers and if the bar is unpaid then that's part of the funds so that's similar to the other lending protocols the difference is that you know utilization uh well not utilization but yeah the difference is that utilization on alpha homo is usually higher um than than than other lending protocol just on the basis of leveraged new farming product itself right so um yeah so that's one thing to know that you know it's similar lending risk

as you were to lend in the other protocols too so now back to your question with um black thursday right yeah so so there are you know several scenarios that we try to to make sure that the parameters take into account including next thursday um however you know we have not simulated that scenario because we cannot simulate that scenario right um so we try to mitigate as much as possible given the parameters uh especially which which means that when it's at liquidation point we set a huge buffer still um so that's one way to mitigate that and another thing that is coming as well

is that we are working with a number of liquidation protocols um to to make sure that we not just limit to the bots or or other liquid data in the space but actually uh working with liquidation protocols um to make sure that we have a strong um backstop uh you know system so one of the pro we're talking to is b protocol so we're trying to see um how we can uh leverage their their technology that they have come up with um as a backstop for the five protocols and see how we can fit with the whole um puzzle here that's crazy b protocol so i've not even explored kind of liquidator protocols

there are entire protocols uh that are to liquidate is that right yeah correct so so that's what they grew uh i i just talked to them last week so um yeah they're pretty new so so um it's it's worth exploring but we're also exploring on the tech side as well um to see if um if it would be you know easy and and good to integrate david the money robots are getting smarter it seems like i've got one question for you then we're gonna pause for breaks and then um we are going to get to all of the community questions that are coming in and and that is like it seems to me tasha that you guys have taken an approach almost like andre from from uh wire and from

wi-fi he came on which is like i'm just going to build the thing that i think the community needs right now right so it seems like you have i'm not sure how your team did this but you've figured something out in d5 that has very strong product market fit and the reason i know this is because alpha hamora is a relatively new protocol is like how many months has it been live at this point in four months four months okay four months and you're already locking i looked uh sometime today close to 700 000 eth right that's like 1.2 billion eth like it's it's a it's an eater it's an eath monster that you've created and that to me screams of of product market fit i'm just curious so

how did you do it how did you was it just like kind of a guess that hey this is something that we think defy needs and then you just you know built built toward toward that or are you d5 users and you just like like felt this case yourself or like how did you find this product market fit so quickly yeah so so i think that's the key with finding and recruiting our team uh we are you know our team are pretty much active d5 users in the space and and also passionate in the space so they they don't just work and encode and pretty much they are active users and reading twitter um pretty much you know very into the the whole ecosystem right um so that means that

all the ideas are actually coming from everyone not just me or nippon and we usually get various ideas from from all the engineers all the time and pretty much once we saw and once we realized that there's a huge you know gap in the east side which means that there are so many eath holders in the space and if you go on um any of the place that you can lend and earn the yields the yields are really really low and i'm sure if you ask anyone who's holding eve if you want high lending interest rate i'm sure they would say yes so so then that you know gives a light bulb moment in which that we just need to find a way to innovate on the borrowing side and create an organic high lending apy on ease and that will give a strong

you know competitive edge and then a good you know product market fit to begin with and then we grow from there um we did not expect that there would be v2 so quickly as well so i think everything is more on adjusting uh to other market needs um like you mentioned yeah super smart because as an eath holder i know and there are many of us like we are strong holders we we've been through a bear market right and uh there's really not much you can do to generate interest on your ether and defy i mean the best you could do is maybe put it in a crypto bank like a celsius or a block fire or something like that but in d5 aside from just staking it in eve too there's really not many places to put it to earn some interest you guys

have created that i think that is a huge part of your success so you know hats off but like were you surprised by the volume of assets under management that you accrued in four months period of time did that even surprise you yeah that surprises me too um and and i think it's it's great to not ignore that lightbulb moment and i think this um gives more clarity that you know light bulb moments are really really important um it may not be that idea that you think at that moment but then if you just stick to it and find an angle that that you know plays with that idea then then that should work um especially if you've been in the space for quite some time i think the value of light

bulb moment will become more and more valuable yeah just to put it into perspective for listeners uh alpha hamora is locking up or alpha at large yeah alpha more is locking up 75 000 ether where ave is only locking up um 420 000 ether which is just crazy it's you almost have them doubled which is pretty cool there are so many more things about alpha that i want to get into including alpha x and this uh this pool of funds that is backstopping alpha alpha hamora and so we're going to get into all of those details right after we get back from a break to talk about some of these fantastic sponsors that make the show possible synthetics is ethereum's decentralized

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wallet has the power of d5 behind it swapping assets on unit swap or earning yield in d5 is at your fingertips but with monolith so are the groceries at your grocery store or the coffee at your coffee shop go to monolith.xyz to sign up and get your monolith visa card today all right guys we are back with tasha from alpha and we have uh talked all about alpha hemorrha and there are a few more things we want to talk about and then we're going to get into some listener questions so if you are watching on the youtube first off thanks for being there and uh now is the time to get your questions in uh while you are doing that don't forget to hit that like button and we'll get to those questions in a little bit but i want to ask about alpha

x because alpha x is a different product than alpha hemorrha so tasha can you tell us about alpha x yeah so it actually came from the market demand again that we saw once we launched our pakomora right that demand is that they want to use leveraging farming product they want to use alpha komora but they don't want to be in a position in which they're shorting ease you know in to give more details on a fakamora v1 in which all the leverage is based on ease um if you supply not in equal amount and and let's say you you're supplying one ease and you're borrowing one more ease to a you farm on eat sushi right then that means that one eat has to be converted to sushi

because you still need both to provide liquidity and you farm so that means that you are in a position of shorting one ease because you're technically selling the ease now uh if the youth price goes up then that means you have to buy at a high price back to pay the loans right so when that's the case then a lot of community members a lot of users uh reached out to us saying that you know is there a way to hedge their positions they don't want to short the ease so you know that gives another light bulb idea that hey we should actually just create another product um that will grow in its own area but still provide this ability to hedge and and provide synergy to al-fakhamura so you know that's how we came across

the idea of of alpha x which is a non-order book decentralized pressure swap trading product um that will grow in this area and still provide um alpha hamara v2 users to be able to hedge their positions um so when we launch alpha x there will be a simple ui for users to just click hedge and then you know take him through the whole process and and open another another long position on alpha x to make sure that they are both in a market neutral leveraged position so that's you know on the high level i can talk more about you know how alpha x is unique from the other um you know protocols in this space and what do we

look to grow our fights into yeah do that and is it out yet or is it when is it coming it's in private testnet right now so we're working on uh adjusting the parameters based on the data that we have got um from the private test nets and then you know depending on how much we have to adjust on the parameters um or on the smart contract um usually not on the on not on the smart contract level but more on the parameters to ensure that it's scales and also safe to use um and then the next step would be to launch public testnet so yeah a bit more about alpha x is that you know the fact that it's non-order book um is already a good thing which means that

you don't have to bootstrap liquidity um to to be able to trade on alpha x right another thing that is you know really unique um about alpha x is that which is what i mentioned earlier is uh we baked in the funding payments or funding rate payments into the price so which means that on alpha ads there is only one price whether you you you open a position whether you close a position that's the price you're you know doing it against right and in order for us to simplify the funding rate payments we bake that concept in into this price so which means for instance if the long were to have to pay the short um then we would shift this price down um

automatically so the long would not have to pay the short but if the long were to close a position they would close at a lower price than if they were to close before the adjustment um so hence they are paying the short indirectly by default so that's the one main thing that's unique about alpha x the second thing that i really like is that the positions the leveraged positions on alpha x are tokenized um it's going to be wrapped into erc20 so which means that you know wherever alpha x is be it on ethereum be it on l2 which we are exploring as well um users can still unlock that interoperability because once you port that your c20 out from you

know l2 to the other protocols in l1 then you would be able to use more benefits and do more things with this tokenized positions very cool all right well um tasha you've teed us up for our first reader question here so this is from someone in the bank list discord asking about your layer 2 strategy so you just mentioned that alpha is exploring it what are you exploring what looks good in layer 2 and what are you planning to implement yeah so um we're actively talking through various uh layer two protocols um looking to deploy you know alpha x on layer two um so so you know this is the the next step for alpha x we're actively um

evaluating various layer two um the fact that the positions are tokenized uh makes it the you know makes it uh still possible to interpret interoperate with the other protocols um so that's why we decided to you know start first with alpha x be on l2 um typically when we when we build the products on alpha finance lab right we don't like to have the product operate as a standalone product we like to have it as an ecosystem even with alpha hamara there's a huge partners and ecosystem that it you know partners with with alpha x we're using the tokenized positions as the the way to create an ecosystem

for alpha x um so yeah depending on which l2 where we're going to choose the public test net should also be on that l2 as well um so so that would be upcoming um in the near-term future natasha do you have any like general directions as far as l2 are you thinking more like optimistic roll-ups or zk roll-ups or something else entirely yeah we're we're thinking more on the optimistic roll-up um so we're actively talking to various protocols in that area very cool thank you so we have a question from carl in the uh bankless youtube about the alpha token um and this is a question that i have as well what role does the alpha token play in

the alpha finance ecosystem so we actually have finalized the alpha tokenomics and we actually have started you know working on the technical details writing the smart contracts adjusting alpha hamora v2 to bake in that alpha tokenomics um so i think that's the high level um that that i wanted to share i think another thing that is good to know now is that there are multiple uh factors in the alpha tokenomics so when we create something we don't just create from from a one layer or one perspective uh we we try to always be more creative and and you know innovate

something uh that we do right so that's the same for our photogenomics so there's you know one component that is um you know similar to two other protocols and then there's another component that is also something new and creative and we're really excited on launching a combination of both so yeah more details to be to be shared i'll make sure to share as fast as possible when we can and making sure that we explain very thoroughly on the new idea that we have come up with are you viewing your token as kind of part of an ecosystem as well so one token across all of the alpha products is that right correct yes okay and then another question that i've

been seeing a lot in the uh bankless youtube comments is about the that insurance fund which i uh promised to come back to towards the end of this podcast so here we are there's an insurance fund that you guys have that is backstopping some of the activity going on in alpha hemorrha but alpha seems to be having a there seems to be a social contract of capital efficiency so what else is this insurance fund going to be used for is this going to be tapped into in any other sorts of ways in the future yeah actually it's going to be related to the alpha tokenomics um so that should be spoiler spoiler alert nice david well done very good um another question came in uh on twitter and this was i think from a

developer so would love to understand alpha's plans to allow developers to build on alpha you've mentioned in the past tasha that um there was this possibility so any thoughts on timing what you'd like people to build and the person is asking because he is one of the people who actually wants to build on alpha so what can you tell developers about building on alpha at this point yeah so i i think at this point um you know myself and the team we have to grow the community initiatives a lot more including you know more grants uh more um growing the developer mindshare for the whole ecosystem so that's uh in

progress um and pretty much you know in the meantime as that's being grown out um if you have any particular idea you want to build on top of alpha homora on top of alpha x or any other any other upcoming alpha products feel free to reach out directly to me on discord also i reply a little bit slow um but you know i reply so so just dm me and with ideas or anything like that for the long-term solution you know we're going to build out more of a decentralized grants than pretty much allowing developers in the space to be able to contribute and be able to have a say on what should be built

on alpha products you guys did get praised so far in these uh youtube comments from someone i remember reading a comment about how attentive and and uh patient some of the explanations out of the your guys's discord was so uh the discord is the community gathering place for so many of these protocols so having a good one is really important so it's a nice job there another question that we have out of the youtube is are there any teasers on what pools they are looking to add to the four that they currently have available in v2 already yeah so more pools are upcoming um a bit teaser just for bangles uh listeners and an audience are you know eat wi-fi is coming

you would also be able to take a leverage on wi-fi so that also means that users can lend wi-fi as well so there will be an ib wi-fi token generating high yields on wi-fi and then the same mindset will grow to you know other assets like dpi snx and so on and so forth ibyfi wow that sound that sounds crazy there you go there's some alpha leaks on our alpha conversation um yeah i had to fit that one in david you know i was going there um another question coming in from uh bankless

bankless discord this time is actually about your partnership with with wiring so what has alpha gained from partnering with wiring up to this point so i think a lot of times you know the gains are more long-term and relationship building and i think we're here for the long term perspective right so sometimes the gains are not quantified to or we get x amount of loans or x amount of you know lending assets on on the product but i think it's the relationship that we have built in a sense that whatever we do we will try to to benefit the partners and same for the partners whatever they do they will try to be wary of us and make sure it's something beneficial to us

so so that's on the long term right on the short term um andre and yearn itself actually have been lending through alfajomora uh v2 as well so to give more color on that you know the uh urine v2 die and usdc vaults um these are lending on alpha hamara right now um to to pretty much grow the liquidity pool of uh lending assets for the leveraged farmers to take the leverage on so that's on the short term and you know once we find more angles then we can work together and then it will grow from there and you know we're using cream as the liquidity uh

place that we take the liquidity from to allow their resources to take leverage right so cream is also a part of your ecosystem and integrating with cream also helps grow the urine ecosystem too oh curious so why cream i think because of several things uh i think when we were building alfa roma v2 cream was at the uh injection point in which uh urine just acquired or like you know yeah acquired a cream so they were up for a new change right and i think in order for a lending protocol to to allow alpha homora and pretty much whitelist alpha hallmark contract they themselves have to adjust their

contract too so korean would have to you know adjust on their code saying that they would whitelist alfa homora v2 and allow alpha hammer v2 to borrow in an undercollateralized way and cream is up for that because it's at an injection point and we are also close to andre um to begin with so you know it's kind of uh like pretty easy to talk to um and i think he has a lot of good ideas um to pretty much find a way to grow alpha and urine ecosystem as a whole okay a bankless member is asking about the uh the harvest function on v2 and said that the cost is 500 in gas at 100 at 100 gway why is it not optimized better do you guys have any

plans to continue to optimize gas costs in alpha more v2 yeah i think um several points to that right uh first point is that alpha homora does a number of operations uh for the users um the more complex your strategy is the more gas costs it's gonna cost so what what determines complex strategy right so let's say if you are supplying only die to the curve three pool and you are borrowing you know 75 percent usdp 10 die 10 usdc so it's pretty complex then that means that all of these have to be um gone through a number of operations uh

to make sure that you provide liquidity in uh you know same proportion on curve which already has pretty high gas to begin with um comparing to other amm protocols um to get the crv token so to prevent you know high gas costs uh one way to do it is to simplify the operations um on on the user's end on our end though uh there are several things that we are looking to do as well one thing is you know we understand that claiming the farm token can cost a lot especially now when the gas cost is really really high so and there have been a lot of community members wanting to to put up a proposal um to

to create another option um to reinvest um so that is something that we're into as well for users who who don't want to pay high gas fees and still want to claim the rewards they could be able to choose the reinvest button it's still to be determined the community members would still have to put up the proposal um and and evaluating through the the risk parameters as well another question uh that came in was about so synthetics recently launched synthetic stocks uh starting with tesla so s tesla everyone's favorite crypto these days does alpha plan to incorporate any of these assets the idea of a

trustless decentralized kind of synthetic stock is pretty appealing especially in the us when uh exchanges like robin hood are shutting down our gamestop stocks any plans around this well you're actually leading me into more alpha leagues okay this is what our jobs are for found one yeah so so you know that's something in our radar um and we're working towards it so i would not say it's not gonna happen but also don't want to commit on any timeline would that be like a separate um product in your ecosystem do you think or would that be kind of something

that could be incorporated into the two existing products uh more on the incorporating into the existing very cool very interesting so a lot of what we're talking about is especially with alpha hemorrha alpha x partnership with uh andre and and yearn and all that stuff that's all on chain stuff and so i have a question on the bankless youtube uh about what are you driving doing to drive usage on the social side of things the the human side of things like is there a marketing department is there a business development what's that side of things like um good question i think that's that's very important um and typically you know we just focus you know a lot on the product understand your product and everything yeah we have a marketing and

business development department and pretty much um the way that we work with our partners is even if there's nothing that we can do together yet we still would like to get in touch um early in case there's anything that we can do for other alpha products right because we're always going to be thinking of new products new new solutions to the space so the more uh we know the better so we can see you know oh this product would actually benefit this partner and we can work together on you know this new product um so so that's been uh you know pretty ongoing and actively uh driven by the beauty and marketing team tasha this has been a fantastic conversation i learned so much this has

been an ama that you know i personally probably learned the most out of of any amas that we've done previously so thank you for that you guys have built a phenomenal product with uh some great product market fit uh and you're doing a great job so so well done and thanks for joining us on bankless thank you so much david ryan and everyone in the bangladesh community and and tasha if anyone listening any listeners on the youtube or listeners on the podcast want to go learn more about alpha where should they go how can they join your guys's community yeah so first place is you can go to the website the website has everything linked with discord linked to twitter telegram link to all the blog posts that we write

all the documents so you know everything is aggregated on the website so it's alpha finance dot io and then you can go anywhere in our community from there well fantastic well bankless nation this has been another ama one thing we want to tell you before we let you go there is a consensus conference that is coming may 24th i will be there david will be there we just learned that ray dalia will be there and if you sign up now you can get 20 off that conference definitely check that out if that's something you're interested in way more fun to attend crypto conferences during the bull market and we are definitely in a bull market for the ages uh so so check that out um tasha thanks again for

being with us of course risks and disclaimers everyone eath is risky so is defy so is bitcoin we didn't talk much about bitcoin these days but we did talk about how to put your eth into alpha hemorrha and be careful of course you could lose what you put in none of this has been financial advice but this is the frontier it's not for everyone but we're glad you're with us on bank list today thanks a lot and if you are on the bankless youtube make sure we get tasha and alpha to the front page by liking the video and also subscribing to the channel for future amas and all the future content that comes out of the bankless youtube thanks guys