(Sanskrit: ब्रह्मा, romanized: Brahmā) Means the creator of the universe. BrahmaFi is creating the Investverse for DeFi.
Dev Note: What you’re about to witness in the following stanzas, is your first evolutionary DeFi touchpoint, channeled via the creator of this ecosystem and THE ecosystem, Brahma.
Meanwhile, I urge you to take out time from your schedule to eavesdrop on this conversation between two frens:
Nocoiner: I want to start investing in crypto. Scratch that, let’s get down to earning some yield, but I don't know where to start bro :(
Crypto Bro: <Sips on some Red Bull. Spills on some complicated defi strategy>
Nocoiner: Wait, What? What’s Metamask? What’s Curve? How does this work?
Crypto Bro: Sire, this is the Future of France (Gedid?), You NGMI
Nocoiner: WTF!
Hard time explaining to your Mom what you do, while living rent-free in her house? (and her mind!)
Brahma Crew (in unison): SAME!
Over the last 2 years, we have witnessed projects and protocols building new financial primitives over ETH, that comprise functions including lending, exchanges, perpetual, derivatives, etc. This array of crypto products has enabled anyone with an internet connection to invest, lend and earn in a trust-independent manner. What was to follow was the Cambrian explosion in innovation that made TradeFi bros look like our ancestors a.k.a making it very complex for retail investors to join in, and rightly so.
Let’s take a moment and recapitulate.
Count the steps from getting money off one's bank account to a friendly DeFi app?
<Counts up to a minimum of 9 steps with % of money lost>.
Needless to mention, the UX is broken, devs are focused on abstracting all the complexities involved with DeFi/Crypto protocols and you start counting to light-years until there is finally a product to bring your mom (here, the general population) on top of DeFi.
As the creators of an upcoming big bang in the DeFi realm, Brahma is committed to an open-sourced, experimental, and research-backed product that makes DeFi accessible for all.
In laymen, we mean we help you make money minus the understanding of the code that runs in the background and we do so transparently. Simple!
Current Crypto/Defi Structure
FYI: There are more groups behind DeFi other than just these two guys
As Vadym stated in his blog, Roughly, there are six major user groups in a protocol ecosystem:
- Protocol Politicians
- Keepers And Arbitrageurs
- Protocols, Devs, And Builders
- Liquidity Providers
- Users On The Demand Side (E.G. Borrowers, Traders, Premium Payers)
- Hackers
One central thing that these groups thrive on is...... Monies, yield, efficiency of capital, that's it. Brahma plans to integrate and make DeFi efficient for all of these groups as stated previously.
Yield/returns are what gives crypto the momentum to grow, add to network effects, and reach the masses, but there's a central problem with how this yield is generated currently. The problem is that yield is funded by the inflationary rewards paid either by governance token holders or the money raised by teams to attract users on the platform (a.k.a Liquidity mining). Protocols like Ribbon finance (We love em, please ape there) have initiated a step towards sustainable product creation on DeFi and validated the demand for more sophisticated ways to generate yields. Taking this a notch higher, Brahma is geared to building instruments that not only create structured, and provide sustainable yields but also incorporate more degen-like instruments.
Introducing Brahma V1:
Cue in some techno
Enter Brahma, a set of products making it easy for anyone to interact with DeFi in a safe and transparent manner. Brahma V1 is focusing on yield-generating instruments that allow anyone to put their money into curated strategies built on top of DeFi protocols, that generate yield using market inefficiencies, and research without any dependence on inflationary rewards like hollow governance tokens.
Brahma V1, utilizes the following approach/opportunities and strategies to generate yield:
- Arbitrage: Market neutral strategies to take advantage of price difference between true value and market value (spot-future, perps-spot, between exchanges, options pricing arbitrage etc)
- Staking Rewards: Proof of stake rewards given by assets with high volume and liquidity.
- Capturing Risk Premium:
a) Volatility selling to capture premium between implied and realised vol
b) High yielding currencies funded by low yielding currencies
Aastra is Live on Main-net
Our first set of products is built for
- Users seeking to generate yield and
- Liquidity providers use their assets more efficiently.
Today we are live on the main net with our first product Aastra, a set of yield generating instruments on AMMs. The first instrument focuses on generating yield by creating synthetic short-put options on Uniswap V3, where users can participate with USDC and get exposure to ETH short put options.
The payoff structure for the LP position looks like this:
While in a typical short put option, the premium is paid at the point of sale, in a UNI LP position case the premiums are replicated by the fee compensated to the LPs. As positions are constructed on Uniswap V3, this ensures that the positions always have deep liquidity and Brahma's algorithms find out the most optimal prices and rebalance the positions on-chain, the algorithms can be found here
The put selling strategy is very similar to Ribbon’s vault. Here is how the strategy works:
- Every two weeks we select a price range for the LP position on Uniswap. (here)
- At the end of two weeks i.e., at time of expiry if the price at upper tick < market price at that time. Your option expires out of money.
- If the price at upper tick > market price the lp position is in range causing you to buy some ETH on your position.
- Now the LP position is initiated if the current price < price at upper tick you start earning premium via the swap fee (link to Uniswap fee structure). So higher the volume on Uniswap pair, the higher the premium you earn.
Audits and Security
We've done an extensive self-audit on our contracts. We are not audited by a third party yet, please exercise caution when interacting with our contracts. The self-audit reports are live on our documentation portal, if you'd like to contribute join our Discord. Our contracts can be found here
Looking forward
At its core, Brahma is driven by a long-led mantra to make DeFi accessible to all by creating a robust research-backed protocol that drives the DeFi progression forward. While this is our experimental quest to create a DeFi “investverse” for the masses, we are striving to stack the ecosystem with value-driven and yield generating products by the day.
Legal Disclaimers
The aforementioned contents in this blog are based on numerous assumptions and uncertainties which are subject to change periodically. The effect of such changes may result in alterations in premise, risks and uncertainties and may cause actual results or developments to differ from the results and progressions anticipated by brahma.fi
Even if our anticipated results and progressions are materialised, such results and developments may yet still fail to achieve any or all of the anticipated benefits anticipated by this statement. Brahma reserves the right to alter the plans, and intentions recorded any time and for any reason or no reason, in sole discretion. Brahma undertakes no obligation to update the decision publicly or revise any forward-looking statement as future developments or otherwise.
All contents and graphics used in the material intend no religious impairment and do not superintend its interpretation. This blog is not aiming to provide legal, financial or investment or other advice. We recommend users to stack their information sources basis their own personal research and not draw tangents from the materials or contents mentioned.