Solace

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Frequently asked questions

What is Solace Protocol?

Solace Protocol is a decentralized finance (DeFi) platform that offers new yield strategies and use cases. It is empowered by the community and operates through Solace DAO, a governance mechanism. Solace DAO enables the addition of incentives to new markets, manages the DAO treasury, and drives the ecosystem forward through grants and bounties. Solace Protocol rewards liquidity for curated lending pools, allowing users to borrow ETH against their LSD or yield-bearing tokens. It is built on top of AJNA, a permissionless and oracle-free 2-token lending pool system. Solace Protocol also offers veSGT governance, which allows users to boost their yield or deepen liquidity for their chosen LSD to borrow at better rates. The platform aims to provide greater yield by delivering additional SGT rewards on top of the returns generated from borrow fees in AJNA markets. Solace Protocol opens up new DeFi strategies by providing lending market liquidity for yield-bearing tokens. It plans to introduce various markets, including stETH, sfrxETH, ankrETH-WETH, StaFirETH-WETH, swETH-bbaWETH, rETH-WETH, SGT, and more. Some of the strategies offered by Solace Protocol include long derivatives and yield on leverage.

How does Solace Protocol reward liquidity?

Solace Protocol rewards liquidity by providing additional SGT rewards on top of the returns generated from borrow fees in the AJNA markets. Liquidity providers in the curated lending pools can borrow ETH against their LSD or yield-bearing tokens, and by boosting their yield or deepening the liquidity, they can borrow at better rates. The veSGT holders play a role in managing the incentives for AJNA's lending liquidity across the markets. Solace Protocol's approach to rewarding liquidity enables the exploration of new DeFi strategies and use cases in the lending market for yield-bearing tokens.

What are the main features of Solace Protocol?

The main features of Solace Protocol include:

1. New DeFi yield strategies and use cases: Solace Protocol offers innovative yield strategies and use cases within the decentralized finance (DeFi) space.

2. Empowered by the community: Solace DAO, a governance mechanism, allows the community to participate in decision-making processes. It enables the addition of incentives to new markets, manages the DAO treasury, and drives the ecosystem forward through grants and bounties.

3. Exotic Lending Markets: Solace rewards liquidity for curated lending pools, allowing users to borrow ETH against their LSD or yield-bearing tokens. These lending markets are built on top of AJNA, a permissionless, governance- and oracle-free 2-token lending pool system.

4. veSGT governance: veSGT holders have the ability to steer AJNA's lending liquidity through SGT incentives across the markets. This governance feature allows users to have a say in the platform's operations.

5. Greater Yield: Solace Protocol provides additional SGT rewards on top of the returns generated from borrow fees in AJNA markets. This feature aims to enhance the yield potential for users.

6. New Strategies: The liquidity provided in Solace's lending markets for yield-bearing tokens opens up a new spectrum of DeFi strategies for users to explore.

7. Coming Markets: Solace Protocol plans to introduce new markets, including stETH, sfrxETH, ankrETH-WETH, StaFirETH-WETH, swETH-bbaWETH, rETH-WETH, SGT, and more. These upcoming markets will offer additional opportunities for users to engage with the protocol.

8. Strategies: Solace Protocol supports long derivatives and yield on leverage strategies, allowing users to optimize their investment strategies within the platform.

Overall, Solace Protocol aims to provide a community-driven, innovative, and rewarding DeFi experience through its unique features and offerings.

Which lending markets are supported by Solace Protocol?

The Solace Protocol supports lending markets for curated lending pools, allowing users to borrow ETH against their LSD or yield-bearing tokens. It is built on top of AJNA and features permissionless, governance- and oracle-free 2-token lending pools. The protocol rewards liquidity providers with SGT tokens and offers greater yield compared to AJNA markets. veSGT holders can manage incentives across the markets, and Solace Protocol enables new DeFi strategies with lending market liquidity for yield-bearing tokens. The protocol currently supports markets such as stETH, sfrxETH, ankrETH-WETH, StaFirETH-WETH, swETH-bbaWETH, rETH-WETH, SGT, and more. Additionally, Solace DAO, a governance mechanism, empowers the community to add incentives to new markets, manage the DAO treasury, and drive the ecosystem forward through grants and bounties.

How can users engage in long derivatives and yield on leverage with Solace Protocol?

Users can engage in long derivatives and yield on leverage with Solace Protocol by borrowing underlying assets against liquid staking tokens, yield-bearing tokens, and other derivative tokens. This allows them to access leveraged yield or long other DeFi products. Solace Protocol also offers a state-of-the-art coverage strategy, allowing users to access liquidity with their yield-bearing tokens and hedge against major DeFi risks without concerns about claims, discretionary voting, conflicts of interest, and other issues associated with DeFi insurance. Additionally, users can supply liquidity to AJNA markets and stake their Liquidity Provider Balance (LPB) on Solace to earn SGT rewards. Solace Protocol utilizes veTokenomics to incentivize liquidity and offers permissionless lending pools for derivatives. By using innovative AJNA's non-custodial lending pools and Pendle's EIP-5115 standard, Solace Protocol unlocks a new range of yield and risk management strategies for DeFi users. The Solace DAO, a governance mechanism, empowers the community by enabling the addition of incentives to new markets, DAO treasury management, and driving the ecosystem forward through grants and bounties.

What is the coverage strategy offered by Solace Protocol?

The coverage strategy offered by Solace Protocol is a state-of-the-art coverage strategy that allows users to access liquidity with their yield-bearing tokens and hedge against major DeFi risks. This coverage strategy eliminates concerns about claims, discretionary voting, conflicts of interest, and other issues associated with traditional DeFi insurance.

How can users earn SGT rewards on Solace Protocol?

Users can earn SGT rewards on Solace Protocol by providing liquidity to curated lending pools and borrowing ETH against their LSD or yield-bearing tokens. Solace rewards liquidity providers with additional SGT rewards on top of the returns generated from borrow fees in AJNA markets. veSGT holders can also steer AJNA's lending liquidity through SGT incentives across the markets. Solace DAO, a governance mechanism, empowers the community to add incentives to new markets, manage the DAO treasury, and drive the ecosystem forward through grants and bounties.