This proposal aims to bootstrap the lending of the ARCH and sARCH token on Demex, an all-in-one perp DEX, to further increase ARCH utility by allowing ARCH to be used as collateral to borrow other assets for more capital efficiency. The proposal, put forth by the Switcheo Labs team, suggests the use of ARCH incentives to promote this launch and bring awareness to the use of ARCH and sARCH as collateral. This is a signaling proposal to gauge the community’s interest before we can move ahead with an on-chain proposal.
Archway is a popular multi-chain Layer 1 launchpad for dApps within the Cosmos ecosystem. It has become a preferred blockchain for budding developers to deploy their applications. The native token of the Archway Network is ARCH. It also offers a Liquid Staking Derivative (LSD) called sARCH, powered by Liquid Finance, a dedicated Archway Liquid Staking Protocol.
Demex seeks to collaborate and support Archway as its DeFi Partner, aiming to be the go-to platform for yield opportunities on ARCH and sARCH tokens. We envision this partnership by listing ARCH and sARCH as collateral on their in-app money market, Nitron. Nitron has already integrated various Cosmos and LSD tokens, making it the ideal platform for ARCH and sARCH to gain exposure within the existing Cosmos user base.
This forum post aims to discuss the possibility of offering ARCH incentives on the lending pool token for ARCH and sARCH on Demex's money market. This initiative would further enhance the utility of ARCH and sARCH, promote buying pressure, and drive wider adoption of the ARCH token.
Demex (Decentralized Mercantile Exchange) is a cross-chain derivatives DEX designed to support any type of financial asset imaginable. Demex aims to make finance accessible and trust-optional while providing an intuitive and familiar user experience.
Nitron is the name of Demex's lending and borrowing money market. It works similarly to AAVE and supports a wide range of networks and assets. It also has a public liquidation platform, which allows anyone to perform permissionless liquidations on undercollateralized loans via the UI.
Demex exists on Carbon Network, a DeFi-focused L1 Cosmos Network built with Cosmos SDK and is IBC-enabled. The team behind Carbon Network is called Switcheo Labs, a doxxed Singapore Web3 development studio founded in 2018.
Archway's ecosystem has seen impressive growth, fueled by successful developer initiatives. This momentum is crucial to maintain its healthy market capitalization, currently exceeding $55 million. The key to sustaining this growth lies in creating more opportunities within Decentralized Finance (DeFi) and expanding token utility.
Our innovative collaborative initiative empowers users to lend out their ARCH and sARCH tokens on Nitron instead of selling them, directly benefiting Archway's market cap stability and reducing selling pressure. By depositing ARCH and sARCH tokens on Nitron, users unlock borrowing power, enabling them to leverage their holdings for various DeFi activities and amplify potential yield and token holdings. This, in turn, contributes to the continued growth of Archway's Total Value Locked (TVL) and staking rewards.
Additional details:
As both chains are IBC-enabled, ARCH and sARCH deposits to Nitron will be done via Demex’s deposit UI which uses IBC transfers which are a lot more secure.
In collaboration with the Archway team, we propose to distribute $10,000 worth of ARCH tokens to incentivize the ARCH and sARCH lending pools. The incentives will be distributed thoughtfully over time to maximize their impact.
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